Kansas City TIF Commission approves $484 million redevelopment plan for historic Scarritt Building

Kansas City’s Tax Increment Financing (TIF) Commission has approved backing for a roughly $480 million redevelopment plan that would transform the Scarritt Building, a historic downtown skyscraper, into a mixed-use complex featuring a luxury hotel, apartments, retail, and a music venue.

Under the plan, the Scarritt Building at 818 Grand Boulevard would be adaptively reused as a 167-room destination hotel branded by Universal Music. The broader project, located on the 800 block of Grand Avenue, would also include a residential tower with 319 multi-family units, about 28,000 square feet of ground-floor retail, and a 1,400-seat music and entertainment venue.

Port KC, the public development authority driving the project, approved the resolution to issue up to $480 million in taxable revenue bonds to support the development. Construction is expected to take place in two phases over roughly five years, with work on the Scarritt Building renovation slated to begin in 2026.

The Scarritt Building, completed in 1907, is one of downtown Kansas City’s oldest skyscrapers. It has been largely vacant in recent years but carries historic significance, having been added to historic registers.

The redevelopment effort seeks to pair preservation of the landmark building with catalytic growth for the surrounding Grand Corridor. Officials argue that restoring the Scarritt Building — alongside new housing, retail, and entertainment — aligns with broader goals of revitalizing the city’s core and driving long-term economic vitality.

If all goes according to plan, the development could bring new residents, visitors, and cultural amenities to downtown Kansas City, anchored by the historic Scarritt Building and powered by modern investment.

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Header image: An aerial rendering highlighting the historic Scarritt Building at 818 Grand Blvd. in the Grand Corridor of downtown Kansas City. Image | Hoefer Welker

Developers face post-pandemic challenges

a MWM CRE event recap

Roxsen Koch, shareholder with Polsinelli PC, and Jason Swords, principal with Sunflower Development Group, joined moderator Christine Johnston, CPA, CGMA, CMA, partner with MarksNelson LLC, for a live webinar discussion hosted by CREW KC this Tuesday.

The panelists discussed tax increment financing (TIF) in Kansas City, Mo., economic development incentives and future challenges facing developers in a post-pandemic world.  

Koch began with explaining that TIF is an economic tool enabled through the State of Missouri which allows developers to capture the tax increment that a real estate project generates in order to finance a project which otherwise might not be financially feasible. 

Although TIF has been used by developers on many prominent projects in Kansas City, Mo., its future use may be more limited, especially to finance any hospitality and retail project in the immediate future, according to Swords.

“I think that’s the tool for keeping jobs,” Swords said.

Koch, who was involved with the financing of the Loews Kansas City Hotel project, said TIF financing along with several other economic development tools, were incorporated into the hotel project.  Although its opening was delayed, the hotel recently opened amid the pandemic.

“Obviously, timing is everything. We were very fortunate to obtain the financing when we did. In today’s market, I don’t think you would see the project come forward. Any project of this nature in Kansas City, Missouri really would be substantially on hold until we knew more about what the world in the future would be,” said Koch. 

According to Koch, there are a lot of challenges amongst successfully financing a project today. 

“You need to have investors who want to have a certain return on their investment to be committed to the project. You have to show you have a team that’s knowledgeable in the construction of that particular project and the operation of that particular project,” said Koch. 

Swords predicts that getting a deal financed in the next few years is going to be tough.

“We’re only seeing the beginning of the triage that is out there. Fifty percent of our small business tenants aren’t going to make it. I think there’s a lot of money on the sidelines waiting for distressed assets,” said Swords. 

Both Koch and Swords agreed that TIF will always be a tool for developers in Kansas City. 

“If policymakers do not embrace the use of TIF on projects that the city wants to see developed, then investors will simply take their money someplace else and they won’t invest in Kansas City,” said Koch.

Swords acknowledged that although obtaining incentive tools from Kansas City, Mo. is not an easy process, the city has been a leader in spurring redevelopment. 

The duo agreed that the one market segment where consumer demand remains strong is housing. 

“I think that everything else is too spec, too tough, too difficult. Housing is the only kind of project we’re working on today,” said Swords. 

Koch added that developers still need economic development tools to make housing projects happen. Although TIF is not typically used to finance housing, Koch noted that there are other economic development tools available to developers such as tax abatement.

“I think that the important thing is to sit back and be prepared for what’s to come. None of us really knows what that looks like right now,” Koch said.