150 Black-Owned Kansas City Businesses To Be Displaced By Omaha Developer
An Omaha developer purchased an office building that serves as an incubator for Black-owned businesses, but no one has told those business owners what to expect.
Willa Robinson will probably need to relocate her store, Willa’s Books and Vinyl, which she’s operated out of the Citadel Office Building at 1734 E. 63rd Street since 2015. She’s heard a rumor that the building will be torn down in the fall.
Neither the new developer, Clarity Development Company of Omaha, Nebraska, or the former local owner, John Barbieri, has mentioned the possibility of dislocation to her or the other 150 mostly Black tenants in the building. However, a recent article in the Kansas City Business Journal says that the six-story building will be razed later this year or early next to make way for a $35 million, 181-unit apartment building.
Barbieri has either managed or owned the building for 26 of its 49 years. He’s currently managing it for Clarity and a related Nebraska business entity which owns the building.
“I called him and left a message, and I said, ‘John, you need to tell me something because we’re hearing all these rumors.’ Robinson said. "He never answered me.”
Barbieri said he thought it would be more appropriate for the new developer to deliver the news, so he’s kept quiet. However, Neeraj Agarwal, Clarity Development's principal operator, said he’s waiting to contact the tenants until he has a firm plan in place, which he expects will happen after the City Plan Commission meets at 9 a.m. Tuesday.
“We want to make sure we’re giving good information rather than just speculating and causing more concern,” Agarwal said.
But tenants said they have been quite concerned and speculating for months, and the silence from stakeholders has made matters worse.
The building, which has a bus stop out front for easy community access, houses hair stylists, a short-order lunch counter, a dermatologist, retail shops, art studios and more. Robinson said it has been a sort of incubator for Black businesses—unlike anything else around.
“I have to give [Barbieri] props, because he did allow people to come in, people that didn’t have a lot of money, and they came in and set up businesses,” Robinson said.
Tenant Sheri Hall agreed. “That’s part of the reason I have a problem with what’s being done to this building," she said. "Because this is probably the only building like this where small, Black businesses and start-ups can come in and really get their grounding with affordable rent.”
Barbieri said the building was about 80% empty when he first started managing it 26 years ago.
“I found over the years that it was just a matter of being able to work with people, and work with people in the community, the African-American community, and I seem to have been able to do that,” he said.
He kept rent inexpensive, under $10 per square foot, utilities included. He was also willing to split suites, like the one Robinson is in, so that two businesses can occupy what was originally a space for one.
In the face of the uncertainty, Hall is trying to centralize communication among the other renters. She’s the CEO of Poetry for Personal Power, an advocacy organization that deals with arts, entrepreneurship, and mental health for area residents.
A while back, she began putting together a tenants’ association to address the many needed repairs in the building. She said the parking is in disrepair and an elevator needs to be replaced, among other things.
“But now that’s turned into: Where are people going to move? What are the resources? How do we stop this? How do we get our voices heard?” Hall said.
She said the lack of communication has left her feeling disrespected, and the little that she knows of Clarity’s plan — to convert the building into 181 single-bedroom apartments and offer free technology courses for area residents — also seems like cause for concern.
“It’s very condescending. That’s one of the things that has me enraged about it,” Hall said.
Barbieri said the repairs became too much for him to handle, and he knew it was time to move on, though when he sold the building, he didn’t know what the developer’s plan was.
Emmet Pierson, President and CEO of Community Builders of Kansas City said the project is still in its early stages. Pierson had also bid on the building and understands that the decision to tear down or rehab isn’t a simple one.
“It is a fine dance between being able to rehab it and pay a mortgage. And most of those folk in there are paying significantly below market rent,” Pierson said. “We wouldn’t have kicked everybody out, but there would have been some displacement.”
The building is in the Swope Park Opportunity Zone. The federal government has designated 8,760 areas in the United States and five territories as Opportunity Zones, meaning they are in economically distressed areas and tax incentives are offered to those who will invest in them.
Pierson said no rules specify that a developer must collaborate with the community.
“It just says, 'Here is what the Opportunity Zone can be used for, this is an eligible use, it’s a real estate endeavor,' so there’s nothing in the legislation that says they have to keep those small businesses,” he said.
Agarwal said his company works closely with local real estate brokers to find comparable situations for displaced tenants. He’s worked with a local market study firm to determine those locations as well as to figure out what sort of resources the area could really use.
His study shows that the area needs affordable single-bedroom housing for service industry workers and first responders. The project, which is called Brookside East, is using the federal low-income housing tax credit program, and its aim is to offer rent between about $850 and $875 per month.
“What we’ll do is look online through resources that are publicly available and will define for Jackson County what are the affordable rents. Affordability is defined as 60% of the area median income,” Agarwal said.
He added that in addition to relocating tenants, Clarity will canvas for tenant interest in returning to the new building, though construction will take about 18 months and no start-date has been set.
“We always like the idea of a mixed-use component, it makes for a more unique project, and perhaps some of these tenants might even have services they can offer to residents. I think it could be a win-win for sure in the end,” Agarwal said.
He also said the project is still in the planning stage, so the types of apartments and how much space is available for business use, is all subject to change.
The only thing that’s certain is that the existing building will be razed at some point between October and the first quarter of 2022, and the 150 current tenants will need to find a new place to set up shop.