Olathe OKs incentives for rundown shopping complex — Here’s the plan

The vacant and dilapidated Rosebud Plaza Shopping Center at the northeast corner of Santa Fe Street and Mur-Len Road could soon see some reinvestment to the tune of $26 million.

On Tuesday, the Olathe City Council voted 6-0 to start the process of establishing a Tax Increment Financing, or TIF, district for the shopping center’s redevelopment, now dubbed Indian Creek Crossing.

Mayor John Bacon said he was starting to “feel a little bit old and dilapidated” recalling clearly when the building was first constructed and how it was “a gorgeous corner.”

“It’ll be new once again, so that’s exciting,” he said.

The incentive application seeking to remake the site comes from David Christie, who recently acquired the bulk of the property — about 115,000 square feet once anchored by a Hobby Lobby that left in 2018 — from an out-of-state owner that city officials have said was hard to work with.

Crunch Fitness also recently bought about 40,000 square feet of space in the shopping center previously occupied by Goodwill for a new gym facility.

Councilmember Matt Schoonover was absent from the meeting.

What is a TIF district?

• TIF districts work by turning over tax revenues earned from increased property value — called increments — to a third party to cover or reimburse costs incurred in the development of a specific project or wider area.
• The vote this week freezes the assessment level for the base year used in determining the increment used for reimbursement.
• TIFs usually come with 20-year terms and have a max reimbursement amount, usually detailed in advance.
• In this case, the developer is proposing a maximum of $7 million in reimbursement from the proposed TIF and other incentives to be requested later.

$26M in new investment planned at Rosebud

Today, the site has some code violations, and there have been some environmental concerns stemming from it, said Sandra Watts, an attorney for the developer.

All told, the cost of renovation, new construction, infrastructure improvements on the site and other investments from new users at the shopping center is expected to cost about $26.4 million.

QuikTrip and a new pickleball-focused entertainment venue are some of the potential users who have already signed on to move to the shopping center. Christie also said Westlake Ace Hardware could move to the site when construction planned in the next few years in the Interstate 35 and Santa Fe corridor likely forces them out of their current home on Claiborne Road.

In addition to redeveloping the shopping center, Watts said the developer will convey some peripheral property to the city of Olathe for future expansion of Firehouse No. 4 located nearby.

Next steps:

• In the future, possibly as soon as this year, the city council will consider a 20-year project plan for the site and vote on a development agreement.
• Later, the developer intends to request the formation of the 1% Community Improvement District as well, which will require an additional public hearing and other steps.

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