Muehlebach Hotel / KC Club Project

Issues concerning Downtown as described by the Downtown Council. River to 31st Street, I-35 to Bruce R. Watkins.
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Muehlebach Hotel / KC Club Project

Post by KCDowntown » Thu May 17, 2018 8:58 am

On the just released LCRA agenda there is a project that calls for the renovation of the KC Club building into a 144-room upscale hotel, the Muehlebach into 117 apartments, new construction of a 4-story office building and a 360-stall parking garage.

This work is bounded by 12th to the north, 13th to the south, Baltimore to the esat, and Wyandotte to the west.

There are no specifics on the location of the garage.

To sum up:
Brass on Baltimore / KC Club -> 144 room upscale hotel
Muelhebach Hotel -> 117 apartments (10% affordable)
New 4 story office building replacing a surface parking lot (assume this has to be at NE corner of 13th & Wyandotte as it is the only surface parking lot on this block)
New 360-stall parking garage at an undisclosed location

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Re: Muehlebach Hotel / KC Club Project

Post by KCtoBrooklyn » Thu May 17, 2018 9:43 am

I thought Epoch bought the KC Club, but on the agenda it says the applicant is MFH Properties, LLC. I believe that was the previous owners, so I guess the sale didn't go through?

Also, the garage and office are to be in the same structure at the NE corner of 13th and Wyandotte. More info here:

http://edckc-meetings.s3.amazonaws.com/ ... 821%29.PDF

Here is what the developer is requesting:

Sales tax exemption on construction materials (STECM) for each of the three Project components;
• 100% reimbursement of sales tax revenues from a 1% Community Improvement District (CID) on
the Hotel Component for 20 years;

• Payment of $250,000 annually (over 25 years, with 5% increases every 5 years) through a parking
agreement with the City of Kansas City (the “City”) which would make parking spaces available to
the public after business hours and on weekends at no cost; and

• Abatement of property taxes (above current predevelopment taxes) generated by the Apartment
and Office/Garage Components for 25 years under the Land Clearance for Redevelopment
Authority (LCRA) (75% abatement in Years 1-10; 37.5% abatement in Years 11-25).

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Re: Muehlebach Hotel / KC Club Project

Post by KCDowntown » Thu May 17, 2018 9:54 am

This is a different building than one Epoch owns around 9th & Baltimore(which became the KC Club after it merged with the University Club).

The "KC Club" for this project is the one that housed the club from the 1920's to about 2000, then became the Clubhouse on Baltimore and now the Brass on Baltimore.
KCtoBrooklyn wrote:I thought Epoch bought the KC Club, but on the agenda it says the applicant is MFH Properties, LLC. I believe that was the previous owners, so I guess the sale didn't go through?

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Re: Muehlebach Hotel / KC Club Project

Post by kboish » Thu May 17, 2018 10:04 am

KCtoBrooklyn wrote:I thought Epoch bought the KC Club, but on the agenda it says the applicant is MFH Properties, LLC. I believe that was the previous owners, so I guess the sale didn't go through?

Also, the garage and office are to be in the same structure at the NE corner of 13th and Wyandotte. More info here:

http://edckc-meetings.s3.amazonaws.com/ ... 821%29.PDF

Here is what the developer is requesting:

Sales tax exemption on construction materials (STECM) for each of the three Project components;
• 100% reimbursement of sales tax revenues from a 1% Community Improvement District (CID) on
the Hotel Component for 20 years;

• Payment of $250,000 annually (over 25 years, with 5% increases every 5 years) through a parking
agreement with the City of Kansas City (the “City”) which would make parking spaces available to
the public after business hours and on weekends at no cost; and

• Abatement of property taxes (above current predevelopment taxes) generated by the Apartment
and Office/Garage Components for 25 years under the Land Clearance for Redevelopment
Authority (LCRA) (75% abatement in Years 1-10; 37.5% abatement in Years 11-25).
According to that doc, the project will also include 10% affordable units at 80% AMI

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Re: Muehlebach Hotel / KC Club Project

Post by kboish » Thu May 17, 2018 10:15 am

Here is their conclusion.
The Project, as presented by the Developer and described above, appears to require public assistance to be financially feasible. The need for assistance appears to be driven by high redevelopment costs associated with the Hotel Component and the relatively low potential revenue generation associated with the Office/Garage component, as compared to the costs of constructing structured parking. It appears that the Apartment Component alone would generate above-market returns, which are effectively subsidizing the other Project components.

In the Base Case Scenario, the Project achieves the low-end of market-appropriate rates of return, signifying that the Project would likely be financially feasible if offered just STECM and CID. However, with additional public assistance, including the LCRA abatement and the City parking agreement, the Project would satisfy other downtown public policy goals without over-incentivizing the Project. The requested LCRA abatement, which is beyond the typical 10-year term offered through the LCRA, would result in the reservation of 10% of units in the Apartment Component for households earning 80% or less of area median income over the term of the property tax abatement. The 25-year parking agreement would allow for public use of the parking garage on weekday nights and weekends at no cost to users.

With the full amount of assistance, the Project, as presented by the Developer would achieve the midpoint
of stabilized yield on cost and unleveraged return benchmarks identified through SB Friedman’s
experience and recent Kansas City projects that have moved forward with construction, signifying that
even with the additional assistance, the Project would achieve market-appropriate rates of return. The
resulting assistance package would amount to approximately 10% of total development costs, or $9.5
million (discounted to 2018 at 7%).
It is interesting that even with 10% of units at 80% AMI, the apartment portion of the project is still profitable before the subsidy.
Last edited by kboish on Thu May 17, 2018 10:28 am, edited 1 time in total.

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Re: Muehlebach Hotel / KC Club Project

Post by smh » Thu May 17, 2018 10:17 am

Exciting stuff--need to make sure the ground level of the garage is activated to further support pedestrian traffic along that corridor between convention center and arena.

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Re: Muehlebach Hotel / KC Club Project

Post by TheLastGentleman » Thu May 17, 2018 10:41 am

I'm glad the muehlebach is getting renovated, but I would have liked to see it return to being a hotel. Seems odd.

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Re: Muehlebach Hotel / KC Club Project

Post by scooterj » Thu May 17, 2018 10:46 am

TheLastGentleman wrote:I'm glad the muehlebach is getting renovated, but I would have liked to see it return to being a hotel. Seems odd.
Yeah, it's puzzling to me that they are converting a building already set up as apartments into a hotel, and a building already set up as a hotel into apartments.

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Re: Muehlebach Hotel / KC Club Project

Post by TheLastGentleman » Thu May 17, 2018 11:00 am

And one of the city's most storied hotels too! Lots of famous people stayed there. Seems like that would be a perfect selling point for a new hotel

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Re: Muehlebach Hotel / KC Club Project

Post by flyingember » Thu May 17, 2018 12:18 pm

TheLastGentleman wrote:And one of the city's most storied hotels too! Lots of famous people stayed there. Seems like that would be a perfect selling point for a new hotel
They're planning on converting the original Kansas City Club building. I bet it has had way more famous people visit it.

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Re: Muehlebach Hotel / KC Club Project

Post by TheLastGentleman » Thu May 17, 2018 1:28 pm

flyingember wrote:
TheLastGentleman wrote:And one of the city's most storied hotels too! Lots of famous people stayed there. Seems like that would be a perfect selling point for a new hotel
They're planning on converting the original Kansas City Club building. I bet it has had way more famous people visit it.
The muehlebach had presidents and the Beatles visit. Doesn't get much more famous than that

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Re: Muehlebach Hotel / KC Club Project

Post by moderne » Thu May 17, 2018 2:20 pm

Isn't the Marriott still using the Muehlebach convention center facilities just south of the old hotel? What will happen to that or will connectivity be maintained through the apartment conversion?

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Re: Muehlebach Hotel / KC Club Project

Post by TheLastGentleman » Thu May 17, 2018 2:25 pm

moderne wrote:Isn't the Marriott still using the Muehlebach convention center facilities just south of the old hotel? What will happen to that or will connectivity be maintained through the apartment conversion?
If they keep the connection, the muehlebach lobby could become a sort of ceremonial lobby for the western addition, which I assume will remain part of the marriott. Could be cool to have a space like that shared between two operations.

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Re: Muehlebach Hotel / KC Club Project

Post by FangKC » Thu May 17, 2018 4:54 pm

I am happy to see plans to do something with the old Muehlebach Hotel. I like buildings that contribute to the neighborhood, and not sit mostly empty.

I'm puzzled by the conversion of apartments to hotel, and hotel to apartments as well. I'm just assuming that the math is driving this thinking, and that it make more sense to convert the old Muehlebach into apartments. I am also happy to see that vacant lot getting developed.

It probably won't be a problem having apartments sharing the hotel lobby. They might have keyed elevators to the upper floors to keep hotel guests and strangers from accessing those floors.

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Re: Muehlebach Hotel / KC Club Project

Post by GRID » Thu May 17, 2018 5:02 pm

The old Muehlebach is in bad shape and they are doing more affordable apartments there while the KC Club building is in much better shape. I think it just comes down to numbers. This is a pretty cool project. I wonder if the four floors of office will be on top of a garage or if the four floors includes the garage. It would be nice if they could bump up the office space to 200k or so.

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Re: Muehlebach Hotel / KC Club Project

Post by FangKC » Thu May 17, 2018 5:19 pm

More office space = bigger garage.

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Re: Muehlebach Hotel / KC Club Project

Post by Critical_Mass » Thu May 17, 2018 6:35 pm

GRID wrote:The old Muehlebach is in bad shape and they are doing more affordable apartments there while the KC Club building is in much better shape. I think it just comes down to numbers. This is a pretty cool project. I wonder if the four floors of office will be on top of a garage or if the four floors includes the garage. It would be nice if they could bump up the office space to 200k or so.
From the document linked above:
The Developer is assuming hard construction costs of approximately $26,200 per space for the
garage component. This assumption appears to be slightly above the benchmark range of
$20,000-24,000 per space for above-ground structured parking in Kansas City. The Developer
indicated two factors are driving the somewhat higher parking: 1) the proposed parking garage is
less efficient than a typical garage due to the relatively small size of the site, and 2) the parking
garage costs include foundational work that supports the vertical office development.
looks like office on top of parking if i'm reading that right. 360 spaces on these two lots, minus stairs/elevators and (hopefully) street level retail definitely means 5 or 6 levels for the parking structure alone.

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Re: Muehlebach Hotel / KC Club Project

Post by FangKC » Thu May 17, 2018 7:27 pm

You could have underground parking levels, street -level offices and retail, then more garage levels, and three or four floors of offices.

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Re: Muehlebach Hotel / KC Club Project

Post by missingkc » Thu May 17, 2018 7:53 pm

Too bad the two buildings to the north of the vacant lot couldn't be worked into this project.

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Re: Muehlebach Hotel / KC Club Project

Post by moderne » Thu May 17, 2018 9:18 pm

Too see a complex development bring this entire block to a higher functioning gives me hope for the lot west of the P&L and the vacant buildings south of 14th.

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