Officials advance Katy Boardwalk
The developer of the hotel, conference center and parking facilities in the Katy Boardwalk faces an October deadline to submit a preliminary two-dimensional site plan, layout concepts and development and construction cost estimates.
The timeline is part of an amendment to a memorandum of understanding with KBH Venture LLC and the Katy Development Authority (KDA) approved by the Katy City Council on Aug. 13 after an executive session.
Katy Mayor Chuck Brawner said the convention center/hotel/parking and 650 loft residences are getting started, though he thinks Sueba USA may be a little ahead of the hotel project with its residences. The city will use funds from the hotel occupancy tax to pay for the hotel/convention center complex.
“We set up time lines when certain things have to be done by certain times this year,” said Jonas W. “Skip” Conner, KDA president. For example. a nonbinding letter of intent from a hotel operator reasonably acceptable to the authority is due by Nov. 30 as is an estimated development and construction schedule.
The amendment to the July 17, 2017, memorandum of understanding reads, in part, “In the event that the developer fails to meet any of the submission deadlines detailed below, this MOU shall terminate automatically according to its terms.”
Conner talked of a Dec. 31 deadline for state funds. “A contract will be signed by the end of the year or we’ll find someone else. We’re looking at probably 2021 before it (The Boardwalk) actually opens.”
The first phase of Katy Boardwalk — including a lake, sidewalks and bridges — is complete, said Conner. The area is not open to the public.
“There’s still a lot of cleanup that needs to be done. It’s not presentable for people to go down there. We don’t want people to go down there without there being some sort of lights on,” he said.
Land and lake improvements were funded by money from the Katy Tax Increment Redevelopment Zone Number One, which was created originally to develop Katy Mills mall and was extended to include the Boardwalk.
The partially built road is being paid for by the city’s metro funding. Katy receives revenue from a half-cent of the 1-cent sales tax collected by the Metropolitan Transit Authority within its boundaries.
But the project ran into issues when it came to providing electricity, said Brawner and Conner.
CenterPoint Energy will serve the area with underground utilities. The multimillion price tag “kind of set everybody back,” said Conner.
According to the memorandum, cost estimates to provide power for the entire Boardwalk District total approximately $6.4 million. That includes $420,000 for engineering and design, $4 million for the construction of an underground duct bank infrastructure and $2.25 million for the primary wire service to be installed in the duct bank with the property connections to such primary wire service.
City officials worked with its partners on how to handle the utility issue. Brawner said that KDA will initially fund the duct bank.
“As each project comes online and ties into the duct bank, it will pay a prorated shared based on square footage,” he said.
“We’re going to become the banker,” said Conner, explaining that it will allow the project go to forward. “The city actually will get its money back over a period of time,” he said. “We’re going to build it (the bank) ourselves. We can have more control of when it can be done.”
Across the street from The Katy Boardwalk, meanwhile, construction continues on the first of two shopping centers called Boardwalk Crossing and developed by Gold Key Partners, said Jeff Goldberg, manager/owner. The first center with 22,000 square feet is 72 percent leased.
“We have some good restaurants coming,” said Goldberg, who said he’s unable to release names of tenants right now.
Construction on the second center of 23,000 square feet is expected to start before the end of the year. Its first lease for 4,500 square feet was just signed, he added.
Reaction from potential tenants has been good, he said, noting the centers are in the shadow anchored by Katy Mills Mall and the Katy Boardwalk/convention center.
“It’s exciting to see all the new projects being built and traffic generated. It’s a good location. We look forward to adding to Katy’s growth and progress and we’re glad to be part of it,” said Goldberg.
Once both centers are placed on the market, he pegged total market value at between $20 million and $25 million.
A 7,900-square-foot shopping center to the east of Boardwalk Crossing is going up and expected to be completed by December, said Chris Mallett, a partner in the project with Corey Bernstein. The center will house Mallett’s State Farm Insurance and Houston Appraisal Group with 4,500 square feet open to rent. Mallett picked the location due to “possible growth and traffic in the area” because it’s adjacent to the Katy Boardwalk.