The first question to ask? Is this a good deal for the City of Westwood? FWWP thinks the answer to this question is an emphatic NO. Our belief is the City does a great job comparing apples with hidden elephants by blurring facts, overstating benefits and downplaying (or out-and-out disregarding) the detriments. Detriments, of course, are the easiest to see. By plopping down an oversized office complex into the middle of a neighborhood, Westwood will experience several downsides, including additional traffic congestion, cut through traffic and abundant safety issues.

But it’s much more difficult to capture the overstated benefits, and the very realistic financial strife this project could bring upon the resident taxpayer; those hidden elephants in the room the City never seems to address.

To start, a small measure of control the City has is collecting taxes on the development for the next 20 years through a Tax Increment Financing plan (known as TIF funding). After the passing of this 20 years, Westwood will no longer have any say in what the developer can do with the property. At that time, the developer can easily sell all or part of this Complex (PLEASE NOTE - from this point we will refrain from calling this an office complex, as the developer, at any time, can change this to a residential property should they desire – we will discuss this prospect further below) to a tax-exempt entity, the obvious elephant being KU Med. This is what occurred with two commercial properties in Westwood: the Sleep Disorder property on Rainbow and the sprawling, former-Sprint property at Rainbow and Shawnee Mission Parkway. Once the TIF funding expires in 20 years, interest in the Complex from the ever-growing KU Med is not difficult to picture. 

The result of this circumstance would mean that all or part of the Complex would no longer produce tax revenue, thanks to the tax-exempt status of the new owner. The byproduct would then be that the Complex would not contribute ANY tax dollars to our police, fire department, park maintenance, public services, etc…

Have you heard one word about this possible loss of tax revenue after 20 years? We highly doubt it.

In addition to the good chance of losing this tax base in 20 years, we also find highly doubtful the $7.95 million Tax Increment Financing (TIF) property tax projections and $4.6 million of net proceeds. The City finally produced these projections in January 2025, after continual requests from FWWP and others.

ONE THING IS CERTAIN – the general obligation bonds the City wants to issue are absolutely certain debt that the taxpayers of Westwood will repay, and the TIF revenue is uncertain. Here’s why:

The City has worked with Columbia Capital (Columbia) to publish the potential incremental property tax revenues from this development. As any professional prognostication would include, Columbia covers their bases within the Memorandum:
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Good on them, as there are numerous uncertainties and, we believe, unreasonable assumptions in the Columbia analysis of these potential TIF property tax revenues of $7.95 million and $4.6 million of net proceeds.

Side note before we get into these uncertainties and assumptions: Columbia says there are 6 buildings. The City says there are 4. That’s a bad start on defining numbers and projections when you can’t even match up a fact the eyes can easily see.

Back to the uncertainties and assumptions…

Phased Construction:

Columbia assumes all buildings will be completed by 2028. Moving forward from that year, they project a 10% annual increase in property value between 2029 and 2030. The 10% increment in value is undoubtedly due to the fact that Karbank will not be able to complete and lease up all of the office and retail buildings at the same time. There may be phases of construction. In fact, Karbank has the right under Section 1.1.12.1 of the Development Agreement to build the office buildings in phases at their discretion, IF COMMENCED. Karbank has the flexibility to construct fewer buildings, mixed-use buildings or not construct all of the buildings as set forth in the plans. Bottom line, delays in construction, lease-up or Karbank’s changed plans may result in significant decreases in TIF incremental property tax revenue.


Overstated Initial Valuation:

Hang in with us here. Numbers can make one’s mind spin. To begin, there is an Incremental Asset Value on the Complex that, through the tax assessment formula, gets numbers to an understandable value per square foot. Through this square footage per $$$, you can get a better grasp on the value that should be assessed to a property. Our goal here is to display that we believe the value of this Complex for property tax purposes in 2029 and 2030 (and future years) is overstated.
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This valuation is a comparison of value in the year 2030, the projected year the Complex goes up in value by 10% because of phased completions. We will use rounded numbers to try to keep your eyes from crossing.*   

Here we go:
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*Financial figures from Columbia Capital Municipal Advisors can be found here
**Projected percentage increase

The value per square foot of $157.19 is in sharp contrast to the 5 existing Class A office buildings in Westwood and Mission Woods, which have an average value of $134.23 per square foot. This means even at the 1% valuation increase ($157/sq ft), this proposed Complex is valued at nearly 17% more than the Class A office space here in Westwood and Mission Woods. Using the 10% increase, the premium value jumps to 28%. With the exception of the current $134/sq ft in Westwood and Mission Woods, we believe these figures to be grossly inaccurate when it comes to the Complex valuation and how much TIF revenue will be received by Westwood.

Heck! Before Westwood even gets to any of this, there is the need to demolish the old Westwood View School. Let’s discuss the discrepancies there...
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Questionable Demolition Costs:

In the fall of 2022, Westwood City Council presented scenarios to “Demo school building, parking, etc, finish grade and sod…” at a cost of $1,700,000 to $2,000,000. In their current Q&A, the City shows “demolition and grading” costs to be an estimated $1,000,000. The Council also stated that the developer will pay $1,000,000 of demolition costs. However, demolition costs are contractually to be paid by an affiliate of the developer that has agreed to pay the demolition costs of the old Westwood View School which “will be approximately $350,000.”

Several websites which address national demolition costs suggest commercial demolition typically costs in the range of $4 to $8 a square foot. Given the 30,000 square foot footprint, it is FWWP's view that Karbank's estimate of $350,000 for demolition, rough grading and seeding is much more realistic than the City's estimate.

$650,000 is quite the disparity. A $1.35M to $1.65M discrepancy (read the first two lines of this section again) is QUITE the DISPARITY...and a good example of the City tossing around inconsistent numbers with abandon.

Prospect of Residential Property within the Complex:

We mentioned earlier that should the developer desire, they can change this project to a partial- or full-residential property at any time. How is this possible? It is a most viable option for this project because the property was rezoned in 2023 to Planned Development for the benefit of the developer. This opens the door to possibly receiving a considerable amount less in the way of TIF property tax revenues, as the assessed value percentage on a property converted to residential living would be reduced from the commercial rate of 25%, to the residential rate of 11.5%. This math is much easier to eye up, as we can quickly discern that figure is less than half.

Fire and Police Budget Increases:

Even if there is no shortfall in revenues during the 20-year TIF period, should this property tax revenue be applied only to reimbursing Karbank, interest on bonds and park improvements, there is no material property tax revenue from the Complex to fund increased fire and police department costs for Westwood. And there is certainly no predicting how the City will utilize incoming funds, but were they to set aside a public safety payment out of the TIF revenue each year for fire and police, as our neighbors in Fairway do, TIF revenues for park improvements would be further reduced.

And, finally, there are…

Developer Reimbursable Costs:

Under terms negotiated* in March 2023, developer payments of “redevelopment project costs” would be eligible for reimbursement from the financing bonds sold by the City and/or the TIF revenues the City would use to build a new park. In addition to this, Westwood could be on the hook for planning reimbursements to the developer through an agreement Westwood signed in September 2023. An agreement that backdates by 60 days prior to the passing of an ordinance benefiting the developer**. What those obligations may be, we cannot speculate. We just know that whatever these developer costs amounted to, application of either of these contractual provisions could reduce the TIF property tax revenues available to fund any park improvements. A Kansas Open Records Act request was submitted to Westwood on February 13 to detail exactly who and what will be paid with the $4.89 million of G.O. bonds.

*Terms negotiated by the City of Westwood through a Funding and Exclusive Rights Agreement (FERA). See Sections 3B and 7 of this contract here.
**Pursuant to Westwood Ordinance No. 1037, adopted September 14, 2023.
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Of course, there’s more. But how much of this do you really want (or need) to take in? We will finish with this position…
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Based on the above, FWWP believes the TIF revenues to be made available for payment of park improvements, as set forth in the Columbia Capital cashflow analysis, will amount to much less than set forth in the projections supplied by the City of Westwood.