Title
Public Hearing: Amended & Restated Paragon Star Apartments LCRA Redevelopment Plan; Grayson Capital, applicant.
Body
Issue/Request:
This is a public hearing to consider the merits of the Amended & Restated Paragon Star Apartments LCRA Plan (the “Amended Apartments LCRA Plan”).
Key Issues:
Public hearing to evaluate the proposed Amended & Restated LCRA Plan, proposed by a new apartment developer.
Background:
On June 22, 2022, the original Paragon Star Apartments LCRA Plan (the “Original Apartments LCRA Plan”) was submitted to the LCRA Board of Commissioners for consideration and a recommendation to the City Council. The LCRA Board approved Resolution 2022-2 following that public hearing, recommending approval of the Original Apartments LCRA Plan.
On July 19, 2022, the City Council approved Ordinance No. 9467 which approved the Original Apartments LCRA Plan, made several factual findings in connection with approval, and designated Gold Crown Properties, Inc., as the developer of record for the Original LCRA Plan. The Original LCRA Plan approval was conditioned upon the developer of record entering into a redevelopment agreement to implement the Original Apartments LCRA Plan.
Gold Crown Properties did not proceed with the apartments project as set forth in the Original Apartments LCRA Plan. Grayson Capital made a presentation to the City Council on January 13, 2026, to introduce the company to the City Council and prepare for this public hearing and the request to assign developer rights for the apartment project in the Paragon Star Village to the company from Gold Crown Development.
Grayson Capital has the contractual right to build the apartments using private financing according to the following anticipated schedule and details:
Method of acquisition -
Developer will purchase the property from the current owner. Developer anticipates closing on the Phase 1 property in 2026, and will have a right of first refusal to purchase the Phase 2 and Phase 3 properties.
Estimated Costs -
Phase 1:
Land acquisition: Approximately $1,456,000
Site Preparation and Improvements: Approximately $44,102,051
Phase 2 and Phase 3: The right of first refusal for each of Phase 2 and Phase 3 sets the anticipated land acquisition cost to be fair market value at the time the right of first refusal is exercised. Site Preparation and Improvements are anticipated to be:
Phase 2: $14,274,900
Phase 3: $19,033,200
Proposed Motion:
Impact/Analysis:
The Amended Apartments LCRA Plan would allow Grayson Capital to carry out the apartments project. The purpose of the Amended LCRA Plan remains the same, which is to provide sales tax exemption on construction materials while maintaining property tax benefits for the City and other taxing jurisdictions during the construction period at a level equivalent to what would have been provided under the TIF Plan in the absence of this LCRA Redevelopment Plan. The mechanism to achieve these purposes is to establish public ownership during the construction of improvements on the Property and for Developer to receive and use a sales tax exemption certificate for the purchase of construction materials that are used in the construction of the Project.
The applicant has calculated that the financial benefit from the sales tax exemption is approximately $1.095 million, from which about $212,000 will be savings from Lee’s Summit sales and use taxes applied to the purchase of construction materials. This is about 2.5% of the total project costs of the apartments.
Timeline:
The Project will occur in three phases. Once construction on each phase begins it will take 12-24 months for construction to be completed.
Phase 1 (~225 units): The anticipated commencement date for construction of the project is 2026, with a completion target during 2028.
Phase 2 (~75): The anticipated commencement date for construction of the project is 2028, with a completion target during 2030.
Phase 3 (~100): The anticipated commencement date for construction of the project is 2028, with a completion target during 2030.
Presenters
Andrea Young, Senior Vice President, General Counsel, Grayson Capital, LLC.
Megan Miller, Gilmore & Bell, P.C., economic development legal counsel for the City.