After more than a year of control by the U.S. Dept. of Housing and Urban Development (HUD), the City of Kansas City took control of the property after an auction sale of the property this morning on Court House stairs.
In an earlier unanimous decision, the City Council of Kansas City voted to move forward with a plan aimed at preserving Parade Park Homes, the nation’s oldest Black-owned housing cooperative.
Under the approved plan which moved forward today, Kansas City acquired Parade Park Homes from HUD, contingent on HUD placing the highest bid at today’s foreclosure sale.
The city will pay a nominal fee of $10 for the properties to HUD and, upon successful acquisition, transfer ownership to city-selected private developer, Indianapolis-based Flaherty & Collins Properties. The city chose Flaherty & Collins from multiple proposals submitted between October and December 2023.
That process was scheduled to take place this morning immediately after the auction.
Redevelopment Details
Flaherty & Collins Properties will have 24 to 36 months to complete the redevelopment project, involving $18.9 million in capital improvements. The specifics of their proposal, including the mix of housing and potential commercial buildings, have not been disclosed. However, when the city asked for proposals, they said they wanted the property to be mixed-income, honor Parade Park’s history, and that they would consider proposals that included ground-level retail.
Per the City release today, “the $275M Parade Park Homes redevelopment plan includes more than 1,000 new, dignified units of housing, with purpose-built affordable senior housing and homeownership opportunities for residents of all income-levels.”
As part of the development agreement, Flaherty & Collins Properties is required to sign a community benefits agreement (CBA). The city wants the CBA – we’re hoping to find out more about the CBA today – to include local hiring and union participation in construction, building with climate resiliency in mind, offering homeownership opportunities, offering low-income housing, and preservation of Parade Park’s historical significance. The exact mix of rental, retail, and homeownership is to be determined. Those details will remain confidential as the city negotiates with the developer.
Next Steps
According to a release from Kansas City Mayor Quinton Lucas, Immediately following today’s closing, HUD’s contractor Leumas Residential turned over property management services to Flaherty & Collins Management, Inc., who will start engaging with residents on behalf of the new ownership to set up new leases.
HUD authorized Tenant Protection Vouchers (TPVs) administered by the Housing Authority of Kansas City for current eligible residents of Parade Park Homes starting March 12, 2024, the day after the sale. Residents who are not income eligible for a TPV will be eligible for an affordable unit after redevelopment.
took control of the Parade Park property, citing financial distress and deteriorating conditions. The council’s decision authorizes City Manager Brian Platt to negotiate an agreement with HUD for the acquisition of Parade Park Homes.
Parade Park History
Spanning 26 acres, Parade Park sits near the heart of 18th & Vine and boasts famous former residents like Bruce R. Watkins, baseball legend Reggie Jackson, and Mayor Quinton Lucas’ mother. When it opened in 1962, Parade Park offered low-cost housing, the ability to gain equity, plus a say in how the co-op was run.
Instead of rent, co-op residents paid carrying charges at a rate set by the co-op board to cover the cost of operating and maintaining the complex.
However, over the years, the co-op board failed to set the monthly carrying charges high enough to adequately fund the maintenance needed on the aging complex. Over the past 15 years, many of the townhomes fell into such a bad state of disrepair that when residents vacated their units, the co-op couldn’t afford to repair them. By 2022, more than half of the co-op’s 510 units were vacant.
In 2019 and 2022, the townhomes scored some of the worst scores possible in their HUD inspections. The death knell came last year when HUD intervened because the co-op was unable to repay a $10 million loan. HUD gave the co-op board a deadline to negotiate a deal with a developer to renovate the project. When that deadline passed without a formal deal, HUD moved to foreclose on the project.
These vouchers will help cover the cost of rent to those who are displaced during redevelopment. The agreement also features a right-to-return policy that ensures residents can return to their units after the redevelopment is completed, and 61 tenants identified as very low-income will be safeguarded from rent increases for two years.
12 Street Heritage 50/50 Partner
12th Street Heritage Development Corp (TSHDC), a community development corporation founded to improve Kansas City’s 12th Street neighborhood, and Flaherty & Collins Properties, a multifamily housing development, construction and property management company based in Indiana are slated to be 50/50 partners on the redevelopment of Parade Park if the project gets a final go ahead in March. (See story on this page for details)
In a partnership well underway in Kansas City, the partnership is renovating The Jazz Hill project, a 100% affordable project located along Paseo Blvd. between 9th and 13th streets in Kansas City. That project is adding nearly 200 units of much-needed affordable housing to the city’s north side. See our Jazz Hill story here: https://bit.ly/424s75Z
