McKee lays out vision for massive north St. Louis redevelopment

One potential source, McKee said, is the ongoing talks with Chinese officials about an air cargo hub and other investment in St. Louis — talks he helped launch.  Yet he acknowledged that the three companies most interested in moving to NorthSide are already in the St. Louis area. He declined to name the companies.

But right now, funding the project is the biggest hurdle.

McKee said he has spent $46 million of his own money on it so far. And in December he reached a financing agreement with the Bank of Washington for about $165 million, according to mortgage documents filed with the city. Otherwise, there's no private money yet.  "I don't have people standing in line, whether bankers or developers, to help us on this," McKee said.

So while he waits for that, he's pushing for public help.

McEagle wants to use as much as possible of the $95 million in tax credits Missouri legislators created in 2007 for assembling distressed land, he said.  It will apply, likely next week, for tax-increment financing from the city worth "hundreds of millions of dollars." McEagle plans to buy city-owned property and swap land with the Missouri Department of Transportation and other
public agencies. And McKee said he's working with area senators and congressmen to steer stimulus dollars to the project.

Several pieces of the project fit nicely with the priorities President Barack Obama has set for stimulus spending. Among them:

• Completely rebuilt sidewalks and streets, some with medians and bike lanes;
  separation of storm and sanitary sewer systems; new parks and green space; and
  better stormwater collection systems. 
• Plans being discussed with MoDOT to reconfigure the intersection of Highway
  40 (Interstate 64) at 22nd Street to ease access to north St. Louis and to
  rework the off-ramp of the planned Mississippi River Bridge to feed directly
  into Tucker Boulevard.
• Co-generation power plants and renewable energy sources to power neighborhoods across the site.
• New parks, police and fire stations, community centers and an in-ground trolley line to circle the neighborhood and connect it with MetroLink.
• It's a lot of public money, but it's the kind of investment that government should be making, said Richard Ward, a longtime economic development consultant in St. Louis and vice president of Zimmer Real Estate Services.

"There's no reason to think that this kind of endeavor would not involve public money," he said. "If anything should and would require a partnership with the public sector, it's this. It's the fundamental regeneration of an entire sector of the city."

The plan is a huge opportunity for St. Louis, said Jeff Rainford, a top aide to Mayor Francis Slay. It's "like nothing that anybody else has ever come up with," he said, and it's worth a shot. But, Rainford warned, McKee's idea is a long way from a detailed plan. And it will need complete community buy-in if he wants City Hall's support.

State highway officials said they met with McEagle several months ago and that engineers have reviewed the proposed 22nd Street interchange. But nothing has been approved, and there's no money set aside to build it, said MoDOT director Pete Rahn.  "We have not had a formal proposal," Rahn said. "Until we have something like that, it is difficult to respond."  Any land swap would have to be "value for value," Rahn said, and fit within the state's transportation plan.

The energy piece of the plan fits well with AmerenUE's long-term goals for efficiency and use of renewable sources, said Steve Kidwell, the utility's vice president for regulatory affairs, and the company will consider providing financing to help get the projects started.  "We see some really innovative and interesting ideas here," Kidwell said.

Ameren hasn't yet decided if it will apply for stimulus money, which includes billions for energy efficiency programs, or if it will partner with McEagle for those dollars, Kidwell said.

McEagle also must assuage the concerns of neighborhood residents, who have watched with suspicion as the company has bought up more than 900 properties, many of which have fallen into decay. Parts of Old North St. Louis, where some rehabbing has already taken place and where residents were vocal in their concerns about McKee, were left out of the plan.

McKee said he plans to use eminent domain very sparingly — only a handful of homes are in the planned "job-creation areas," and the distressed-area tax credits can't be used on eminent domain property — and will "reuse, retain and maintain every building that can be saved."

McKee also said he's sorry for the secrecy around the project these past five years, as he bought up property without saying what he was doing. He said he was just trying to keep prices in check. "If there's anything to apologize for, it's that," he said. "But I didn't know how else to collect all this land."

McKee has met in small groups with some neighborhood residents, but he plans to attend a community meeting tonight and address them in full for the first time.  He wants their input, he said, and their help, to fill in the crucial details that will make the big vision into a reality.  "This is the beginning of a 15-year process," he said. "It's a vision. Not a plan. We're a long way from the finished product."

Critics, skeptics greet Mckee

May 21, 2009 - By GAppleson@post-dispatch.com">Gail Appleson - ST. LOUIS POST-DISPATCH

A standing-room-only crowd of several hundred people listened intently Thursday night as Paul McKee unveiled his ambitious plan for the transformation of a large swath of north St. Louis.  But there were still plenty of skeptics.

The presentation was interrupted at least twice by distrustful residents who complained that McEagle Properties, McKee's O'Fallon, Mo.-based development company, has failed to maintain its buildings and properties in St. Louis, letting many decay.

One man, spouting expletives, called McKee a liar and portrayed him and his partners as white men taking advantage of the residents of the largely black neighborhoods in the redevelopment area.  McKee responded that while he is white and his company is based in the suburbs, he grew up in St. Louis and cares about the city.  "I really believe in this city," he said. "St. Louis is my home. ... We believe the north side will lead, not follow."  McKee said his company had spent about $1.4 million maintaining properties but conceded that things weren't handled perfectly.  "Could we have done a better job?" McKee said, and some residents yelled "Yes!" as he continued: "We're doing the best we can."

Prior to McKee's remarks, Aldermen Marlene Davis, 19th Ward, and April Ford-Griffin, 5th Ward, acknowledged complaints but urged residents to at least to consider McKee's ideas.  "I simply ask you to open the dialogue," Davis said. "I also ask you to trust me."

While McKee has previously met with some neighborhood leadership groups to discuss his plans, Thursday's meeting at Central Baptist Church at 2842 Washington Boulevard was the largest and most open session for residents. The aldermen had sent some 4,500 invitations to voters in their wards.

Many residents were upset, saying they have watched McEagle buy up more than 900 properties in their neighborhoods and do nothing with them for five years as he developed plans for the project, called NorthSide.

Over the next 15 years, McKee hopes to convert some 500 acres on the city's north side into 4.5 million square feet of new office and retail space, 10,000 new homes, parks and even a trolley line.   The massive plan comes during the deepest recession in decades and will most likely need a huge infusion of government money. In fact, McKee said he and his partners will seek at least $1.1 billion in aid from the city, state and federal governments. As soon as next week, he intends to ask the city to provide "hundreds of millions" of dollars in financing to get the project off the ground.   McKee said he has spent $46 million of his own money on it so far. And in December he reached a financing agreement with the Bank of Washington for about $165 million, according to mortgage documents filed with the city. There's no other private money yet.  The key to it all, McKee said, is bringing in jobs. He envisions 22,000 permanent jobs and 43,000 to build it.

Winning everyone over likely won't be easy for McKee. Barbara Manzara, who lives in the 5th Ward, said before the meeting that she didn't trust McKee because he had let so much property crumble.  "I'm looking for evidence of a plan he'll begin managing property appropriately," she said. "A little honesty would go a long way at this point."

After the presentation, residents were divided into smaller discussion groups, but many remained concerned about the lack of maintenance of existing properties.  Terry Horace said the neighborhood needed help now.   "It looks good on paper, but in reality what are they going to be able to do?" he said. Horace said that he's 57 now and by the time the project is done, he'll be in his 70s. "But hopefully my granddaughter will see something out of it."

Others didn't seem to think their voices mattered much.  "We've been through this before," said one man who interrupted McKee's presentation. "They do what they want."

After the meeting, McKee was asked by a reporter what he would do to overcome so much mistrust from residents.  "It's obvious a lot of people are meeting me for the first time," he said. "We need to get to know each other and build trust. That takes time, and this is the start of that." 

Not everyone was untrusting. Rodney Hubbard Sr., executive director of Carr Square Tenant Mangement Corp., said he was attending the meeting with an open mind to learn more details about the plan.  "Any development right now would be welcome, but we have to make sure it will benefit the community," he said. "I think it's a courageous move."