Old Kmart to become restaurants, housing and retail space in $130 million JoCo development

Plans to replace the vacant Kmart near Shawnee Mission Parkway with retail space, restaurants and two apartment buildings were approved by the Merriam City Council at their regular meeting Monday.

The council approved several items for the $130 million development, including the rezoning and project plan and the redevelopment agreement.

Matt Pennington, president of Overland Park-based Drake Development, said the property was a difficult site but he felt lucky to be able to present their proposal.

“This has been a long process,” Pennington said.

In February, Drake Development’s plan to build a grocery store on the site was unsuccessful. The city said at the time that the grocery store plan failed because the city was unable to “strike an appropriate balance” and that it was the city’s priority to help businesses thrive, but also protect the financial interests of Merriam taxpayers.

Merriam’s Planning Commission approved the updated rezoning and preliminary plan for the mixed-use development June 1.

The site is located on the south side of Shawnee Mission Parkway between Eby Avenue and Antioch Road. A Freddy’s Frozen Custard, Krispy Kreme and La Petite Academy are already located there and will not be changed, according to city documents.

The proposed development would include a 3,300-square-foot retail building, three 5,600-square-foot restaurants, a 2,100-square-foot restaurant and two apartment buildings with 158 and 204 units. An outdoor space will sit near two restaurants and the apartment buildings, and have amenities for customers and the public, according to city documents.

The eastern apartment building will have 117 one-bedroom units and 41 two-bedroom units. The western building will have 151 one-bedroom units and 153 two-bedroom units, according to the plans.

The apartment buildings would each have parking beneath them and a parking structure between them. Both apartment buildings will have amenities like pools, exercise facilities and dog washing rooms.

Public funding and traffic concerns

According to city documents, the development will be funded in part by a variety of public financing. An estimated $4.5 million will be funded through sales tax industrial revenue bonds for a sales tax exemption on construction supplies.

Up to $400,000 in city development and inspection fees will be waived because the developer will pay all of the third-party inspection fees, according to the plans. An estimated $7.8 million will come from property tax industrial revenue bonds for the apartment buildings and have a 10-year property tax abatement.

The developer can also receive up to $25 million in tax increment financing reimbursement for eligible expenses.

Councilman David Neal said that he is worried about the amount of public funding going into the project and the potential for it to fall back on Merriam residents.

“Looking at the amount of funding for this project, I understand the need for it to a certain extent,” Neal said. “But I also am concerned that the particular mix of commercial properties in this project aren’t going to necessarily cover all the possible additional costs the city is going to incur, which means that the residents will have to make that up at some point.”

There were also some concerns about the additional traffic to the area, but a deceleration lane is planned at the main entrance on Shawnee Mission Parkway. Improvements like an additional turn lane will also be made at the intersection of Eby Avenue and Shawnee Mission Parkway.

The developer also plans to put in a bus stop on northbound Eby Avenue and Shawnee Mission Parkway.

The developer plans to demolish the empty Kmart building by the end of this year and get the site ready for construction by the end of 2023, according to the plans.

The entire project is set to be completed by the end of 2026.