Could new exhibit backed by Patrick Mahomes boost debt-laden Johnson County development?

The Museum at Prairiefire in southern Overland Park will be the new home of the College Baseball Hall of Fame, which officials hope will boost visits to the development struggling to meet lofty sales projections in order to make payments on its bond debt.

State and local officials, as well as College Baseball Foundation leaders and players, announced Tuesday morning that Overland Park will be the permanent home of the nonprofit’s first-ever hall of fame. The move, leaders said, was the result of work from Visit Overland Park, state and city officials, and even Kansas City Chiefs quarterback Patrick Mahomes, who was celebrated Tuesday for his support and undisclosed financial contribution.

“Baseball has been a huge part of my life, and I was fortunate to play the game in college,” Mahomes, who played ball at Texas Tech University and is the son of a former MLB pitcher, was quoted saying in a news release. “I’m excited for the College Baseball Hall of Fame to call Overland Park home and join the community that I love so much.”

The hall of fame will become a staple of the Museum at Prairiefire, which opened in 2014 at 135th Street and Nall Avenue. The museum is the centerpiece of the broader, 60-acre Prairiefire development, with restaurants and shopping.

Mayor Curt Skoog told The Star on Tuesday that he anticipates the hall of fame will “drive visitor numbers to the museum, as well as Prairiefire, Overland Park and the state of Kansas significantly over the next decade or so.

“We have lots of visitors in for our sporting activities every weekend, between soccer, baseball, volleyball and all the different youth sports gatherings we have. This will be kind of an automatic destination for those folks.”

The announcement comes after the development last month defaulted on its Kansas Sales Tax and Revenue, or STAR, bonds after not paying off $15 million in debt on time.

That was the first slice of $65 million in STAR bonds issued by the city in 2012. The development has struggled to meet the sales projections set when it gained approval for the state incentives, which are intended for unique tourist attractions. The controversial Kansas tax incentive program has faced scrutiny over the years as various projects have not lived up to expectations. It’s set up to allow cities to issue bonds to pay for construction, which are paid back with future sales tax revenue generated by the projects.

Despite the project defaulting on STAR bonds, on Tuesday Prairiefire developer Fred Merrill Jr. called the development a success, saying it is 100% leased and drawing crowds.

“If something isn’t paid with regard to the bonds, it’s because it didn’t meet the sales taxes that were originally projected 12 years ago,” he said. “We have other financing. We have a lot of cash and other private financing, and the debt service has been paid every single month for 10 years.”

Revival for the museum?

Leaders of the nonprofit Museum at Prairiefire, which has hosted history, science and art exhibitions, have worked to grow visitors and programs over the past several years.

Terri Thompson, executive director of the museum, said in addition to its exhibits, the museum has made an impact through its work with underserved students, including providing science education to 8,000 children from Boys and Girls Club last summer.

She said in an email that the museum funds and operates a program, KC Urban Advantage, which provides “outstanding teaching and learning opportunities in support of STEAM (Science, Technology, Engineering, Arts, and Math) achievement – all FREE of charge – to students, families, and schools from ten Title I KC metro elementary, Boys and Girls Club of Greater Kansas City, Emmanuel Center, and Operation Breakthrough.”

The museum operated more than $2 million in the red in 2015 and 2016, and was down $1.5 million in 2017. That was when the outlook started to turn around, as leaders said they were taking cost cutting measures and implementing a new business strategy. Leaders then reported about 350,000 annual visitors.

In 2019, tax documents show, the museum generated $200,000 in net income. But it took a hit during the COVID-19 pandemic, with the museum once again losing money. The most recent documents show it operated in the red by $689,000 in 2022.

An annual report from January 2023 showed that museum visitors were up 43% over 2021.

Warren Wilkinson, president of Visit OP, said Tuesday that he estimates the College Baseball Hall of Fame will bring 150,000 new visitors in its first year, and 200,000 visitors and a $25 million economic impact after the fifth year.

The hall of fame is expected to open in late 2025, officials said, calling it a “digitally immersive experience for inductees, players and fans to appreciate the history and significance of college baseball.”

“Prairiefire was built for this moment,” Wilkinson said. “Working together, we have not only secured a permanent home for the College Baseball Hall of Fame, we’ve intentionally created a unique place that elevates our destination and supports our tourism strategy.”

Craig Ramsey, chair of the College Baseball Foundation board, said the museum space offers a “blank canvas to custom design” the exhibit. The College Baseball Foundation, established in 2004 in Texas, presents annual awards and has inducted 15 classes into its hall of fame, representing 152 players, coaches and contributors.

Leaders did not disclose the total cost of bringing the hall of fame to Overland Park, but Ramsey said fundraising efforts are underway. On Tuesday, the Kansas City Business Journal reported that Kansas is contributing $500,000 to help remodel the Prairefire space for the installation.

Skoog said because the exhibit will routinely change, he expects the hall of fame to draw visitors back to Prairiefire over time. He said the foundation also aims to connect with area school districts to provide educational activities and K-12 STEAM programs for students.

Prairiefire’s STAR bonds

Leaders hope the new attraction can help change the narrative around Prairiefire, which has struggled to generate enough sales to pay off its STAR bond debt.

The last tranche of Prairiefire’s STAR bonds are scheduled to mature in 2032. But a 2021 audit estimated it could take until 2046, or as late as 2104, to collect enough sales tax revenue to break even.

Last month, bondholders received a notice of default after Prairiefire didn’t pay off the $14.9 million in principal and $1.7 million in unpaid interest due, according to UMB Bank, the trustee. The bank transferred $3.8 million from its debt service reserve fund, essentially a savings account, to help pay for it.

To date, Prairiefire has paid only $130,000 on the principal of the $65 million bonds issued more than a decade ago, Overland Park city spokeswoman Meg Ralph said earlier this month.

About $22 million in bonds helped pay for the construction of the roughly $27 million museum, according to previous Star reporting.

Overland Park did not guarantee the debt on the Prairiefire project, meaning its taxpayers aren’t on the hook. The developer also isn’t responsible for payment of the STAR bonds.

“If the STAR bonds are not able to be repaid, only the bondholders are affected,” Skoog said Tuesday. “Prairiefire is not negatively affected. The city’s not negatively affected. I’m not exactly sure where we are in that process other than the notice that was given out that they’re not likely to be able to repay the bonds.”

Earlier this month, UMB Bank notified bondholders that it plans to file a petition in Minnesota state probate court for instructions regarding administration of a trust and how to use available money to pay off the debt. The petition had yet to be filed on Tuesday, so details remain unknown.

A spokesperson with UMB declined to comment further on Monday. Ralph, with the city of Overland Park, said UMB will “direct all actions related to the defaulted bonds.”

Merrill previously told The Star in an email that business at Prairiefire is “good with record traffic during the holidays.”

Patrick Lowry, a spokesman with the Kansas Department of Commerce, said Monday that the office “has no formal role in the Prairiefire STAR Bond project at this point other than to monitor the ongoing discussions between the city, the bond trustees and the bondholders.”

The development includes an AMC Dine-In theater, shops like REI and Made in KC, and restaurants Pinstripes Bistro, Rock & Brews and Chicken ‘N Pickle.

Kansas Lt. Gov. David Toland, secretary of the commerce department, spoke at Tuesday’s press conference in Overland Park.

“The state already is a committed partner of the wonderful Prairiefire development, in which we’re standing, and I think we can all agree this is the perfect location for this state-of-the-art attraction,” Toland said.