Manhattan developer proposes commercial, residential space on Aggieville parking lot

Aug. 18—A local developer has proposed constructing a mixed-use building at 12th and Laramie streets in Aggieville.

TJ Vilkanskas of Back 9 Development on Tuesday presented a vision to Manhattan city commissioners for the area behind Kite's Bar and Grill now occupied by a parking lot. Commissioners unanimously voted to move forward with negotiations.

The city and Back 9 Development will discuss the project again at the Sept. 7 meeting. If negotiations continue from there, a final development agreement would be presented later this year or early in 2022 with a finalized design, timeline and budget for the project.

Vilkanskas said the estimated $40 million proposed design would feature 21,000 square feet of retail space, 155,000 square feet of office space, 13,000 square feet of public gathering space and 23,000 square feet of residential space. It also would include 74 parking stalls, likely a mix of public and private spots. He said they estimate the building could bring in as many as 700 jobs based on the square footage.

Vilkanskas said they have plans that incorporate the Chipotle on North Manhattan Avenue and others that do not. He said they have discussed the project with property managers of Chipotle but have not finalized any agreements.

Back 9 Development was the only developer to submit a proposal for redeveloping the parking lot after the city government asked for them earlier this year. An unnamed company previously approached the city unsolicited about the idea of redeveloping the 0.87-acre parking lot.

Commissioner Linda Morse expressed concern about the loss of parking in the district. The existing lots have roughly 100 parking spots. Construction would not begin until after the completion of the new parking garage on North Manhattan Avenue next to Rally House. Back 9 Development's proposal would have them purchasing the lots from the city for $1, and Morse said that seemed insufficient to her.

"I think this is a great project, but I'm not willing to sign away the public's interest ... without some direct compensation," Morse said.

According to Riley County appraisal records, the parking lot's total value is $1.46 million in 2021. City administrators estimated the $40 million investment would annually generate $1 million in property taxes.

Commissioner Usha Reddi also wanted to ensure that the loss of parking would not be a problem, although she said it was a good opportunity to bring jobs to Manhattan.

"Parking spaces are so critical for our businesses in Aggieville," Reddi said. "Regardless if it's 500, 700, however many employees you have there, they're going to have to park somewhere and so are the residents that live there, so 75 spaces is not going to be enough."

Commissioner Mark Hatesohl countered that sacrificing the parking lot would be worth the jobs and property tax money the building could bring in.

"I will trade a city parking lot for 700 jobs and a million dollars in property tax a year every day of the week," Hatesohl said. "All these guys are asking for is a parking lot, so that's the cheapest the city will have ever paid to get anything similar to this type of a development."

Vilkanskas said preliminary discussions with investors and tenants have shown an interest in office space near Aggieville. Manhattan Area Chamber of Commerce President and CEO Jason Smith spoke and said being near a walkable district helps businesses attract employees to Manhattan. Deputy City Manager Jason Hilgers said creating existing office space is appealing to businesses who are interested in coming to town.

"We're hearing more and more interest without a desire to build their own buildings," Hilgers said.

Meadowlark, Blue Hills entrance repairs

The commission also unanimously voted to create a benefit district to pay for a portion of the repairs on the frontage road from U.S. Highway 24 to Blue Hills Shopping Center.

The benefit district includes Meadowlark Hills, Dollar General, Dara's and RLD Properties, which manages the Blue Hills Shopping Center. Each entity's portion of the cost will be apportioned based on the square footage of its lot. Meadowlark Hills and RLD Properties will each pay 38.1%, Dollar General will pay 15.7% and Dara's will be 8.2% of the benefit district's share.

The Kansas Department of Transportation will pay 50% of only the construction of a left-hand turn lane off Highway 24.

Officials want to modify the intersection as it prepares to build a primary care clinic for Meadowlark residents.

Overall, the construction of the turn lane and the repairs to the frontage road will cost an estimated $547,543.75. KDOT's share would be $78,950. The city would contribute $134,215 and the benefit district would pay $334,378.75 for the entire project.