4/01/2007

Owner of former Indian Springs files Chapter 11: Kansas City KS Business Journal, 3/28/07

By Jim Davis

The former Indian Springs Shopping Center's owner on Monday filed for Chapter 11 bankruptcy protection in U.S. Bankruptcy Court in Kansas City, Kan.

The owner's agent said the filing was made to delay a proposed demolition of the long-struggling mall by the Unified Government of Wyandotte County/Kansas City, Kan. The Unified Government declared the area blighted in November.

Joe Vaught, president of the Vaught Group, the owner's commercial real estate agent, said the Unified Government isn't entitled to condemn the property.

"We want to protect the property by slowing down the eminent domain clock," Vaught said.

A new law will take effect in Kansas on July 1 that will require governments to get legislative approval before using eminent domain for economic development.

Vaught, a former county commissioner, said he thought this requirement would provide for "a much more fair" review.

Mike Taylor, a Unified Government spokesman, said the bankruptcy filing will complicate the government's purchase efforts but won't stop them.

"We are going to pursue the redevelopment," Taylor said.

The blight designation has disrupted a proposed conversion of the mall into an office park, Vaught said.

The Kansas Department of Social and Rehabilitation Services was negotiating to lease space for 300 employees, he said. The 10-year lease would have generated $11 million.

A $7 million lot sale was canceled, Vaught said. The buyer intended to employ 120 people on the 6-acre site, he said.

Indian Springs, now called Park West Business Center, is owned by Kansas City Mall Associates Inc. of Panorama City, Calif. The bankruptcy filing lets the company restructure its debt so it can continue operating.


Kansas City KS Business Journal: http://kansascity.bizjournals.com