Cordish plans to start $25M Midland affordable housing project this year
Work is progressing in preparation for the next Cordish Cos. apartment development in Downtown, but it may not be Three Light.
The Baltimore-based developer is aiming to start construction in the fall on its $25 million redevelopment of the former Midland office building — next to Arvest Bank Theatre at the Midland in the Kansas City Power & Light District — said Nick Benjamin, the district's executive director and Cordish's managing director of multifamily development.
Work will start, he said, after Cordish finishes undergoing the state's historic tax credit process. The developer seeks approximately $3 million for the Saxon at Midland, which will create 117 apartments in the 12-story building at 1221 Baltimore Ave.
With an average unit size of 447 square feet, the majority of apartments will be 518-square-foot, one-bedroom units. The apartments will range from $700 to $1,100 per month, and 50% of the units will be available for less than $950.
The complex also will include resident lounges, a conference room and fitness center.
The more modest apartment pricing is the product of a deal struck in 2018 between Cordish Cos. and city officials, as the developer sought approval on incentives for its $150 million, 322-unit Three Light apartment tower.
The city's Planned Industrial Expansion Authority in May 2019 approved a 25-year property tax abatement worth as much as $1 million, plus an exemption for sales tax on construction materials.
Cordish will pay approximately $3.3 million in payments in lieu of taxes (PILOTs) to the affected taxing jurisdictions, which Benjamin said represents close to 100% of the property taxes owed.
Those payments will start around $103,000 per year and increase 4.5% every other year for the 25-year duration of the incentives, he said.
Despite the ongoing coronavirus pandemic, Benjamin said Cordish has been leasing units above budget for its One Light and Two Light towers, and expects demand for downtown apartments to continue to grow for the foreseeable future.
"There continues to be, even in the worst moments of this (pandemic), very strong demand for downtown living," he told the Kansas City Business Journal on Friday. "We remain bullish about the desire of many people to live Downtown and continue growth in the downtown apartment space."
Cordish has "momentarily paused" the start of construction for Three Light, but Benjamin said he anticipates work will begin in the third or fourth quarters of 2020, overlapping with progress on the Midland project.
Originally built in 1927, the Midland building previously served as headquarters for the National Collegiate Athletic Association (NCAA) and AMC Theatres. It now is listed on the National Register of Historic Places.
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