St. Louis developer owes $800K in property taxes. It’s causing problems at City Hall.

ST. LOUIS — One of the region’s most prominent developers owes the city hundreds of thousands of dollars in delinquent taxes across several properties. And it’s causing problems at the Board of Aldermen.

For months, Green Street Real Estate Ventures has been asking for an extension on a tax break on North Riverfront land it wants to turn into industrial space. But aldermen, including President Megan Green, said in recent days they can’t cut Green Street’s taxes when it already owes the treasury more than $20,000 on that property alone, due at the end of last year.

“Other people in our city are required to pay their taxes to access other benefits in our city,” Green said.

The same issue could hold up another, bigger project. Green Street wants to turn a former Famous-Barr warehouse in Midtown into apartments, offices, shops and entertainment space. But it needs the property rezoned, and aldermen on the board’s major development committee have been alarmed to hear it owes more than $600,000 — just on that building — in late taxes, penalties and interest. The rezoning bill hasn’t moved an inch in the five months since it was introduced, and multiple committee members said it shouldn’t.

“I’m one of these people that says you need to do what you’re supposed to do,” said Alderwoman Laura Keys, of the O’Fallon neighborhood, who filed the rezoning bill. “They need to correct any issues with their obligation to the city.”

“Hopefully,” Keys said, “it’s just an oversight.”

But Green Street also owes on at least three other properties in the city, including more than $100,000 on the building housing its McRee Street headquarters in Forest Park Southeast, bringing its tab heading into the 2023 tax season to nearly $800,000. And the stumbles at City Hall follow months of troubling news out of the firm: Its principals have been at odds. It’s been laying off workers. And contractors have been suing Green Street for hundreds of thousands of dollars.

Green Street CEO Phil Hulse did not respond to multiple requests for comment. David Sweeney, the developer’s lobbyist at City Hall, declined comment.

The losing streak marks a notable shift for Green Street, a St. Louis development darling. Founded in 2008, it has spent the intervening years building up a resume stacked with prominent projects.

Contractors file dozens of suits

Green Street did Urban Chestnut’s bierhall in the Grove entertainment district and Rockwell Beer’s shipping container-accented home nearby. It developed Bar K, the dog-friendly restaurant and entertainment concept in the same area. It turned the old, empty Missouri National Guard armory in Midtown into The Armory, a massive entertainment venue featuring live entertainment, six bars, backyard games and a 30-foot TV.

It also built industrial space on the North Side, redid the old Carondelet Coke plant on the far South Side and promised for more affordable housing in the Grove with a development called Unify. City officials, happy to court one of the handful of developers working St. Louis, approved a litany of tax incentives to aid the work.

And in recent years, Green Street executives sought to go even bigger. They acquired architecture and design firms with clients across the country and added a construction arm to build projects for themselves and others. And even as the pandemic hit, supply chains sputtered and interest rates soared, Green Street has continued to propose ambitious projects across the region.

Executives have pitched a $100 million high-rise development in Clayton with 270 apartments, including a rooftop deck and garden. They’ve pitched a $400 million plan to line a half-mile of Manchester Road in Brentwood with apartments, townhomes, offices and, potentially, a hotel or microbrewery. And they’ve had plans for St. Louis, including a new hotel on what used to be the corner of Wells Fargo’s Midtown campus and the redo of the old Famous-Barr warehouse.

But over the past year, cracks have begun to appear in the facade.

In February, Paul Giacoletto, who ran Green Street’s construction arm, sued the firm’s principals — Hulse and Kevin Morrell — for $2.3 million, saying they outsourced building contracts his people could have completed and made his division cover costs on projects when Green Street ran out of money. That lawsuit was eventually dismissed. But then contractors hit Green Street with dozens more, alleging they hadn’t been paid hundreds of thousands of dollars for their work.

Gateway Roofing filed a lien for $139,500 for work on apartment buildings in the Grove, for instance. Alper Audi Inc. filed another for $211,500 for work on an apartment project in the area. And while most of the liens have since been resolved, court records show there are at least a couple still outstanding, including one Budrovich Sewer Co. just filed Wednesday for $8,700.

‘It’s not personal’

And then there are the debts to the city. Officials called out the delinquent taxes at an aldermanic committee meeting this summer on the tax abatement for the north side property, and at a Planning Commission hearing on rezoning the old Famous Barr warehouse in mid-June.

In both meetings, representatives for Green Street said they had payment plans in place with the city to cover what they owed.

But Susan Ryan, a spokeswoman for the Collector of Revenue’s office, said Green Street has no payment plan in place for either property.

In October, Green Street laid off a handful of employees, including a few top development executives. The company called the decisions difficult and blamed them on “current levels of economic activity.”

In November, it became clear that Green Street was backing out of the Wells Fargo project.

And in recent interviews, aldermen indicated the delinquent property taxes are going to be a problem if Green Street wants to continue doing business with the city.

Alderwoman Shameem Clark Hubbard, who chairs the influential Housing, Urban Development and Zoning committee, said it was hard to have sympathy if a developer isn’t making an effort.

“It’s not personal for Green Street,” she said. “It would be the same for any developer. I can’t do anything without paying my taxes.”

And Green, the aldermanic president, said the board will soon consider codifying that sentiment.

A forthcoming bill will require firms to be current on all their property taxes before they can get an abatement.

Steph Kukuljan of the Post-Dispatch contributed to this report.