Baldwin board selects Kansas City, Mo., developer's proposal to purchase, redevelop Chapel Street properties

The for sale sign in front of the old middle school on Chapel Street can come down after the Baldwin school board voted 6-1 Monday to enter into negotiations with a Kansas City developer to purchase and redevelop it and the neighboring South Gym. Enlarge photo

September 23, 2013, 11:38 p.m. Updated: 24 September 2013, 1:14 p.m.

Unable to decide on the merits of two rival proposals to purchase and redevelop its surplus Chapel Street properties, the Baldwin school board chose Monday to sell them to the highest bidder.

The board voted 6-1 to have Superintendent Paul Dorathy enter into negotiations with Kansas City, Mo., developer Tony Krsnich and Landmark Development for the purchase and redevelopment of the old middle school, South Gymnasium and surrounding campus in the 700 block of Chapel Street.

Board member Sandy Chapman voted against the motion. The vote disappointed the 30-some supporters of a rival proposal from Free State Broadband who attended the meeting. CEO Mike Bosch submitted the proposal last week and pitched it to the board Monday.

The two proposals were the only ones submitted in response to seven letters the school district mailed earlier this month to those who had previously expressed interest in the buildings.

All seven board members praised both proposals. They agreed Krsnich had the advantage of experience in redeveloping historic buildings and more clearly defined financing, while Bosch and his companies, Free State Broadband and Reflective Group, had the edge of local ties and a track record of creating jobs in the community.

The six board members voting for Krsnich’s proposal said they couldn’t predict which of the two proposals would benefit the district and community more, so their decision came down to the one thing they could measure: the bids. Krsnich offered $90,000, or $20,000 more than the Free State Broadband.

The board emphasized in its request for proposals that while money was important, other factors would be considered. Those included a demonstrated ability to pay for and develop the properties, the redevelopment plan’s benefit to the community and a schedule to redevelop the properties.

Krsnich told the board Bosch approached him about partnering the the development but that Bosch’s plan wouldn’t fit with his financing package.

In his address to the board on Monday, Krsnich stressed his record of renovating historic buildings and financing the projects. His projects include the redevelopment of two warehouses in east Lawrence slated for demolition, which helped rejuvenate the surrounding neighborhood as an arts district.

Krsnich made available to the board signed commitments from investors to purchase $614,000 in federal historic preservation tax credits and $763,000 in state historic preservation tax credits. That would be part of the estimated $5 million package it would take to renovate the two buildings, he said.

Both responses proposed using part of the old school building for an entrepreneur incubator, which would make communal office space and offices available to small and start-up businesses while providing them with conference rooms and basic business necessities such as Internet, copier, printer and scanner as part of their rent.

The reuse proposals differed in how they would use the building’s remaining space.

Krsnich’s plan would convert much of the old school into living quarters.

In his written proposal, Krsnich suggested the South Gym be reused as a community center in conjunction with art studios and that both uses would involve Baker University. His proposal did not anticipate that the old gym would generate revenue, he told the board.

The surrounding property is an ideal site for an organic garden, such as those on his east Lawrence development, Krsnich wrote. The renovations would include solar panels and electric car recharge stations, he wrote.

With his selection, Krsnich said he would meet with the Baldwin City Economic Development Corporation and schedule meetings with community groups to help determine the mix of housing to build in the old school.

Because of the property’s proximity to Baker, his proposal assumed the apartments would be market-driven rentals, Krsnich said Tuesday. He said he was open to including rent restricted units if that was the need in the community.

If all goes well, construction could begin shortly after the first of the year and the project could be completed in about six months, Krsnich said. He said he would take the time to do the project right.

“The important thing is not that we complete this in June or July of next year, but that we work well with the community to have a project everybody can be proud of in 15 or 20 years,” he said.

The Free State plan would have used the old school’s bottom floor as the home of Free State Broadband and expanded Reflective Group operations. In addition to the incubator, the two top floors would be home for companies and non-profits associated with the Reflective Group and an all-day day care center.

The Free State proposal said the company would partner with the Baldwin Athletic Club and owner George McCrary to establish a “community center” in the South Gym. In his address to the board Monday, Bosch said he had also talked with The Baldwin Academy and Voice about the gym.

The money from the sale of the property will be deposited in the district’s capital outlay fund.

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