Riverside apartment project in doubt after commissioners hear criticism from St. Louis developer | KCUR 89.3
After weeks of criticism, a deal between the Kansas City Port Authority and a St. Louis developer seeking to build a $55 million riverfront apartment project took a hit Monday.
Port Authority commissioners couldn’t get a second on a motion to take a final vote that could have granted tax breaks to the 251-unit apartment project proposed by Lux Living.
This is after some commissioners, as well as representatives of housing advocacy group KC Tenants and the tax courts criticized the deal at Monday’s meeting of Port Authority commissioners.
They have raised questions about the degree of due diligence the Port Authority, or Port KC, has performed on Lux Living. The developer has been the subject of recent media reports about its previous development work in St. Louis and the past of its chief executive, Victor Alston.
“Given their background, I don’t even know how you would consider them in the first place,” said KC Tenants member Ruby Watson. “Before you start distributing bonds, you really should do a thorough analysis of these companies.”
Lux Living did not immediately respond to a request for comment on the board’s decision.
In a statement, Port Authority chief executive Jon Stephens said the future of the project would be discussed in the coming weeks with the commissioners of Lux Living and Port KC.
Last week, the Midwest Newsroom published a report detailing how Lux Living failed to disclose Alston’s 2017 settlement with the Securities and Exchange Commission in response to a question in Port KC’s application.
The settlement resolved allegations of accounting issues while working for Ixia, a California network company. Alston did not admit or deny the allegations; the SEC ordered him to pay a $100,000 fine and banned him from being a director or director of a public company for five years.
A Port Authority official said the developer was not technically required to disclose the matter to the SEC under the version of the disclosure form in effect at the time, but acknowledged that it should have. be disclosed “out of an abundance of caution”. The current version of the disclosure form would have required its disclosure.
The report also revealed that the developer did not disclose any recent lawsuits in response to another question on Port KC’s application form. Alston’s attorney, Ira Berkowitz, argued that the lawsuits need not be disclosed because they “won’t affect anyone”.
The St. Louis Post-Dispatch recently published an article describing tenants of Lux Living’s St. Louis apartment building, The Hudson, complaining about living in unfinished apartments and maintenance and security issues. .
During the meeting, several committee members said they had concerns about the developer. Commissioner Henok Tekeste said he was “struggling” with a yes vote.
“The school district is not happy, the tenants association is not happy,” he said. “What are we really doing? Isn’t that what we should be doing so that the tenants, the school district, and the community benefit from this thing? »
Commissioner Kevin O’Neill, who criticized Lux Living at a meeting last week, made his reservations clear.
“They have a sketchy history,” O’Neill said. “For an entrepreneur from out of town to come in – and have that kind of experience and [want] this 25-year abatement period – I’m going to find it hard to bear.
At a development committee meeting last week, Port KC’s senior development manager Krishan Purvis said he was confident Lux Living was a developer the agency could trust after a trip to visit its developments in Saint-Louis.
However, the agency added rules to the proposed development deal with Lux Living in an attempt to “protect itself”. Port Authority General Counsel Brian Rabineau said the rules would allow the agency to intervene if complaints and issues arise during development.
But Lux Living’s past wasn’t the only concern at the meeting.
Kansas City Public School District political strategist Kathleen Pointer and several members of the KC Tenants organization have criticized the development’s affordable housing. They said the units weren’t exactly affordable, even though they followed the city’s affordable housing rules.
“We support adding truly affordable housing,” Pointer said. “We don’t think the burden should fall entirely on the tax jurisdictions.”