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Target, Kohl's coming to Kingsport Pavilion
BLOUNTVILLE - Target and Kohl's are among retailers coming to a planned development in Kingsport, Sullivan County Mayor Steve Godsey said Thursday.
Godsey made a preliminary presentation to the County Commission's Budget Committee seeking about $1.5 million from the county to help the developers offset costs associated with the project.
Kingsport Pavilion is a 78-acre development expected to contain more than 30 stores and restaurants, along with two major retail tenants. Once complete, the shopping center will be the second-largest retail development in the Model City, coming in behind the Fort Henry Mall at 630,000 square feet.
Godsey agreed with Commissioner Ralph Harr that the new development could mean a downturn for the mall.
"This'll close down Fort Henry Mall," Harr said.
"It probably will," Godsey said.
Last week, the Kingsport Economic Development Board approved a contract with Merchants Holding Co. (MHC) of Austin, Texas, for the construction of Kingsport Pavilion - a 425,000-square-foot shopping center on East Stone Drive at the old Mason Dixon property.
As part of the contract, the KEDB will pay the developer $2.5 million up front to help fund construction. On Tuesday, the Kingsport Board of Mayor and Aldermen agreed to repay that debt - at $500,000 a year for five years beginning in July 2008, when new sales tax collections from the development should be flowing into city and county coffers.
City officials estimate Kingsport Pavilion will generate $1.3 million a year in sales taxes, another $432,000 a year in sales taxes for Sullivan County, and create as many as 1,000 new jobs.
Godsey said KEDB officials now are asking for the county to become a partner in the payback of the $2.5 million.
The BMA's $2.5 million payback to the KEDB, Godsey said, wasn't just for the Kingsport Pavilion project - but for some other projects as well.
When completed, the new development will be valued at an estimated $46 million by the county property assessor's office, Godsey said - meaning about $432,000 per year in new property tax revenue to the county, based on the current property tax rate.
KEDB is asking the county to contribute about $297,000 per year, for five years, to help repay the $2.5 million, Godsey said.
"We have a huge, big development," Godsey said. "It's going to be a big development. Kohl's is coming in there. Target is coming in there. There are ... 35 or 40 big-name outfits coming in. It's going to be huge."
Budget Committee Chairman Eddie Williams said the development is good news for Sullivan County - that it could have been on the other end of Kingsport, in Hawkins County, instead.
Godsey's information wasn't in the format to seek a vote from the Budget Committee, but the proposal got favorable comments from Williams, Harr and other members. Godsey said it won't come for a vote by the commission for at least another month - it won't be on the agenda at the group's Oct. 16 meeting - and the amount the commission is willing to fund is yet to be decided.
Godsey said it was his understanding that the $2.5 million was required to help get Target going in the development.
The BMA, prior to the board's vote on Tuesday, was told that in order for the major anchor to come to Kingsport, MHC had to agree to give the tenant free land.
Matt Lukas, vice president of MHC, said they would be giving the major anchor 10 acres of land, adding that the tenant makes requests such as this on a case-by-case, city-by-city, basis.
"For most anchor tenants, their deals are very specific on how they think they're going to do in the city. It drives the request from developers," Lukas said. "Every deal, different tenants require different financial considerations, from how you build out the store to a tenant allowance."
Lukas said he expects to make an announcement on the tenants in mid-October.
"The major anchor does not pay for land, so the land has to be given to them in order to incent them to come to a development," Assistant City Manager Jeff Fleming said. "It's a slippery slope, but it's the risk/reward proposition that you have to get involved with if you want to compete at that level with those type of tenants."
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Retail does not come to a city first and foremost to attract others to move to a city. Major retailers will not come here because it thinks it can attract professionals. They will sign a lease because it feels it can do business in this town and be profitable. The reason the mall has 4 jewelry stores is simple, people like to comparison shop, each offers something different and they each are successful. If they weren't they would not be here. When Kingsport was in-between movie houses, there were many businesses contacting us because they were having trouble recruiting due to no movie theater in town. So, having retail does matter. It is as much a part of the infastructure of a city as the sewer system and roads. As far as jobs are concerned, there are many well paying jobs in retail. Working with the public is a great skill and any person needing to hone their public speaking skills or conflict management skills should work retail. It is a great training ground for later on in life along with providing scheduling flexibility for those who need it.I truly believe Mr. Godsey or Mr. Harr did not realize the impact of their comments. Both are community oriented and want to see all business do well. I talked with Mr. Godsey and left convinced he was very sorry for all the negative feedback. We need to give them a break.
Mr. Williams and Ms. Lawson are perfectly correct - as a young Kingsportian who has studied and is now pursuing a career in community/economic development, it pains me to read of the city's increased reliance upon retail; it particularly amazes me how much a collective hatred of Johnson City has fueled its growth.
I know everything about this new development is not bad, but yet slightly increased taxes and many, very-low paying jobs (retail pays even lower than the service industry - and mind you, one of the TOP objectives of the current city administration was to increase average income) do not make up for the further loss of a unique community (cough cough..this has been on the ropes for years - decades likely), unchecked sprawl, and lost resources and time (just think of all the time put forth to drawing another S and K in or making sure we have a Maggie Moo's to counter the Marble Slab - only a few mere miles away).
The city has much going for it - I just have a feeling by pursuing this development, they are clearly missing the Target.
At least my tax dollars will not be funding Johnson City students, anymore.
I have been waiting for a target for years. Now if we could just get a Gap and an Old Navy, I would never have to go to Johnson City again.
Are we joining the ranks of Anytown USA? I can stop at towns all along I-75, I-40 I-wherever and it begins to all look the same.
This is great news for the city of Kingsport to continue to attract new retail development into our area. However, I do not think it is in good taste that two of our local leaders would make comments related to possible closing of an already established retail facility. I think this is an opportunity for the Fort Henry Mall to step up and attract new stores as well. Let's not write them off just yet, I for one am hoping all the retail areas will be very successful.
I'm glad to see Kingsport getting a new shopping center with all the new and popular stores in it. A few things worries me though. A lot of the stores are going to be just like the ones in Johnson City. Will the people used to going to Johnson City to shop and then going to the various restauants and bars there later, change their old shopping habits and start going to the newer development? Also Commissoner Ralph Harr brought up another point. He said this development will close the Ft. Henry Mall. Will the Ft. Henry Mall then become an example of urban blight as the old Kingsport Mall did? It's great to have new development but if you build it will the people come? Plus what about stores that do not copy cat what Johnson City has? It would be nice to have something uniquely Kingsport's own. Again I say that having new stores coming into the area is great but I hope that the consequences of their arrival have been considered.