Belk, Inc. named as second Branson Landing anchor
Belk, Inc., along with previously announced Bass Pro Shops, has agreed to be an anchor tenant for Branson Landing, but the developer will have to form a transportation development district (TDD) to raise funds to pay for incentives used to entice both retailers.
Belk, the largest privately-owned department store in the United States, is similar to Nordstrom or Dillards. Belk officials have not signed the final lease.
HCW Development Company’s Rick Huffman plans to impose a new one-percent sales tax in a yet-to-be-determined TDD area. “The developer and the city will cooperate to form the TDD and impose a one-percent sales tax and that one-percent sales tax will essentially be used to pay for subordinate lien tax increment financing (TIF) bonds,” said David Queen of Gilmore and Bell, the city’s special legal counsel.
Queen released some details of the incentive package at a special meeting Monday, March 15. Queen said by contract HCW asked Branson for $33 million in subordinate lien TIF bonds for retail incentives. Currently HCW is projecting that no more than $20 million will be used, but Queen said right now the number is at $15-$16 million.
“We are peeling off these TDD sales taxes and we are doing this dollar for dollar exchange,” Queen said. “This dollar for dollar exchange is because the types of costs you can reimburse with TIF dollars is broader than the types of costs you can reimburse with transportation dollars.” By state law, TDD monies collected can only be used for transportation purposes. Retail incentives do not fall under that category. Every time HCW gives the city a dollar from the TDD revenues, the city will give HCW a TIF dollar to pay the store’s their incentives.
There is also a subordinate lien on excess revenues from the entire TIF area. If all of the debt is paid and the $37 million associated with land costs, the city would be reimbursed for both of those pieces to the project. Queen said any additional money left over could be used to make up any shortfalls not covered by TDD sales tax revenues.
Queen said the incentives are self-policing. “I can tell by the amount of debt that he (Huffman) is willing to buy on the TDD/subordinate TIF bonds what he thinks the sales tax revenues are going to be,” he said. Queen said the TDD boundaries have not been drawn up yet and additional business owners around the area could choose to be part of the district. City Administrator Terry Dody said the city would benefit from Huffman’s ability to tax his leasees.
Belk will occupy a 66,000-square-foot space in the development. Belk offers fashion apparel, accessories, shoes, cosmetics and home merchandise. “The store’s layout, décor and merchandise selections will be designed especially to meet the shopping needs of customers in this area,” said Linda Zwern, chairman of Belk’s Western Division based in Greenville, S.C.
Huffman said Belk is a well-respected department store that will add to the overall project. “Belk has an incredible history, combined with a successful track record, and the Branson community is eager for this store to open,” he said. “This quality first-class shopping addition will reinforce our appeal to Branson’s newer demographic of younger and more affluent customers.”
Paul Motta from Urban Retail Properties, HCW’s leasing management firm, said the two anchors will make Branson Landing a successful project. “Bass Pro is not duplicating another store here,” he said. “They are creating a crown jewel.”
Motta said the Branson Landing Belk store will be its first in Missouri. With only one tenant actually signed on to the project, Motta said more leases will have to get off the ground soon. “Can we make a 2006 opening date?,” he asked. “Yes we can. The next six months are critical for the project.”
David Livingstone with Citigroup said there are currently 37 non-binding letters of intent from companies willing to locate in Branson Landing and eight that are in the final stages of negotiations.