Perceptive Software Moving from Shawnee to Lenexa

The Kansas City Star

June 1, 2012

Perceptive will leave Shawnee, move a few miles southeast to struggling development.

Perceptive Software is planning to leave Shawnee for new headquarters in the Lenexa City Center, breathing life into that struggling development but sparking tension between neighboring Johnson County suburbs.

The Lenexa Planning Commission is scheduled to review a proposal next week that calls for a four-story office building, a 540-stall parking garage and a 921-space surface lot at the southwest corner of 87th Street Parkway and Renner Boulevard in the City Center development.

The deal would be subsidized by $15.1 million in tax increment financing help from Lenexa that would be reimbursed by a portion of the additional taxes the new project is expected to generate. The 120,000-square-foot project would be completed in 2013, according to the application.

Perceptive Software and its more than 600 local employees are at Shawnee Mission Parkway and Kansas 7 in Shawnee. Its three-story, 100,000-square-foot headquarters building, built with the help of tax abatements, was completed for the firm in 2005.

Shawnee officials were unhappy Friday about the prospect of Perceptive leaving one subsidized project for another incentive-driven deal a few miles away in Lenexa.

“I’m very troubled by it,” Shawnee Councilman Jeff Vaught said. “We aggressively went after them, offering abatements and cash. We used every tool we had in the box.

“I’m pro economic development and I support incentives if they’re used properly, but the city of Lenexa is giving away city land and taxpayer money to move a company four miles within the county. It’s such an abuse of incentives.”

Lenexa officials were unavailable for comment, but Copaken Brooks, the developer hired by Lenexa in 2005 to try to get the 200-acre City Center development moving forward, was elated.

“We are pleased to have the opportunity to bring Perceptive Software, a leading global technology company, to Lenexa and City Center,” said Keith Copaken, a principal at Copaken Brooks, in a statement.

“We believe the City Center development is an ideal location for Perceptive Software and will provide an outstanding work environment for the company and its associates, now and into the future.”

Lenexa has been pursuing the City Center project since 2002. The ambitious development calls for a pedestrian-friendly development with offices, retail and residences. Though the city has spent $55 million on roads and other infrastructure, the endeavor has struggled to take off.

Should the Perceptive Software project move forward, it would bring a fast-growing business to the development that should boost its prospects. Plans submitted by Copaken Brooks to Lenexa indicate a second-phase, 120,000-square-foot office building also is planned for the future for Perceptive Software.

Sherlyn Manson, a spokeswoman for the firm, confirmed that plans to move to Lenexa had been submitted, but she declined further comment.

“It’s early in the process,” she said. “The city is reviewing the proposal.”

Vaught said using incentives to assist a suburban project such as Lenexa City Center goes against the intent of such programs.

“Incentives originally were intended for troubled areas where the demographics are horrible and nobody wanted to go there,” he said.

“For Lenexa to aggressively go after this project to correct their mistake … you don’t give away that much to move a company four miles. There’s no gain to the community or the county.”

The latest inter-suburban flap is reminiscent of the situation in 2007 when Lenexa offered a property tax abatement to lure the headquarters of Applebee’s International from Overland Park. Applebee’s stayed in its new building at 11201 Renner Road until last year when it moved to Kansas City, aided by a $12.9 million incentive package.

Perceptive Software was founded as Perceptive Vision in 1988 in Missouri, and it moved to Lenexa in 1994. The company moved to Shawnee in 1999. Its software helps businesses computerize and manage their documents and manage workflow and other business processes.

In 2010, Lexmark International of Lexington, Ky., acquired Perceptive for $280 million, although the firm remains a stand-alone business.

Besides Shawnee, it has offices in Europe, Asia, the Middle East and South Africa.

The building now housing Perceptive Software at 22701 W. 68th Terrace was built by Tom Zarda with the help of tax abatements. It was bought in 2007 by David Harvey of Overland Park-based StoneCreek Properties. Harvey said Perceptive’s lease runs through October 2015.

“We did everything in our power to keep them, and the city of Shawnee did everything as well,” he said. “The decision went well beyond economics.”

Though he’s disappointed, Harvey said he’s confident a new tenant will be found for the 7-year-old building.

“We still have a contract with Perceptive for an extended period of time, and it’s a spectacular building that will be an opportunity for another company to move in,” he said.

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