By Ben McCarthy
Rain and a gloomy forecast couldn’t stop a coterie of local officials and dignitaries from gathering May 28 at the corner of College Boulevard and State Line Road in Leawood to witness the groundbreaking ceremony for the future global headquarters of Lockton.
Lockton, the world’s largest insurance brokerage, will be leaving its current location at the Country Club Plaza, where it has been since 2000, and becoming the anchor tenant for the Hallbrook North Development in Leawood. The company expects to move into a 176 foot-tall building (Leawood’s tallest) when the development’s initial phase is complete in 2030.
Hallbrook North is the brainchild of VanTrust Real Estate, who had several officials on hand for the ceremony. Company officials could be overheard describing their relief that the day was finally here while describing to other attendees as “years in the marking.”
Once official remarks began, VanTrust President and CEO Dave Harrison appeared to confirm what his leadership team was saying in a more unofficial capacity.
“We’ve spent a lot of time working with the Lockton family, and company,” Harrison said. “This project is a result of that strong partnership.”
Lockton’s move across State Line Road was only officially announced a week before last Christmas, but rumblings of the relocation began growing louder last summer, as company officials confirmed they had been considering the possibility for at least a year (their Plaza lease also expires in 2030).
Last October, the Leawood Governing Body unanimously approved passage of the mixed-use rezoning for Hallbrook North, a $765 million development, with a strong suggestion from VanTrust, that a high profile Kansas City company could be looking to make the site their future home and agree to become the anchor tenant. Lockton confirmed that same week that they were interested in the site, and indicated their current Plaza location was no longer viable as their growth was outpacing the physical limits of its current space.
Kansas Governor Laura Kelly followed Harrison and outlined her vision for the 34-acre development.
“By 2030, this open field will be transformed into a modern, cutting-edge business environment,” Kelly said.
The Governor also promised the development will not only be a “world-class work environment” for its 1500 local employees, but also touted its other elements, including: a childcare center, a 145-room hotel with a 10,000 square-foot event center, shopping and dining options, and 400 apartments. Lockton’s 12-story, 450,000 square-foot office tower (with ground-floor retail) will be the first completed phase of Hallbrook North.
Kelly said the new headquarters would allow Lockton to hire 250 new employees, and the company would be investing over $300 million into the site over the next five years.
Hallbrook North is the largest development to date for Leawood, and city officials touted the project’s projected generation of about $25 million in new revenue over 25 years (as opposed to the $613 they would collect in property taxes if nothing was built there over the next 25 years).
Despite no mention of it at the ceremony, the City of Leawood is also set to help finance about 16% of the project’s total cost. Just prior to Lockton’s December announcement of their move out of the Plaza, VanTrust was able to secure an incentive package from the Leawood Governing Body that could be worth $146 million.
That package includes:
- Over $103 million from the creation of a tax increment financing (TIF) district: The TIF district is projected to generate over $108 million in incremental property tax revenue, with VanTrust set to receive 95% of that for the life of the district.
- Almost $19 million in transient guest tax (TGT) collections over 22 years: This is the 8% hotel tax paid on a hotel room in Leawood, which would typically go to the City’s Transient Guest Tax Fund and then be used toward economic development.
- $14.6 million in sales tax exemptions on construction materials: Leawood would issue as much as $766 million in industrial revenue bonds.
- Nearly $10 million from the creation of a 1.5% community improvement district (CID): an extra 1–2% sales tax would be added to purchases made within the new CID, lasting up to 22 years (Leawood typically caps CIDs at 1%).
Leawood Mayor Marc Elkins chose not to dwell on those or any other figures during his ceremonial remarks, instead pointing to both Lockton and VanTrust as having stellar reputations.
“These are exactly the group of people we want to partner with here in Leawood,” Elkins said.
“Thank you for choosing us.”
Construction is set to begin next spring.