For years, Kennedale had a reputation as the home of a half dozen sex shops and strip clubs — even though five of them weren’t actually in the city.
The sexually oriented businesses — huddled at the city’s main entrance, where Interstate 20, Southeast Loop 820 and U.S. Business 287, also known as Kennedale Parkway, come together — weren’t just an embarrassment to city leaders; they also hurt the city’s bottom line by holding back economic development.
“When I first came here and talked about businesses and people investing in the community, nobody wanted to do it because of that front door,” said Bob Hart, who was Kennedale’s city manager for 10 years before leaving in January for the same post in the Denton County city of Corinth. “I can’t tell you how many people told us, ‘When you close the [sexually oriented) businesses, call us.’ ”
After a decade-long legal battle led to a settlement that called for the businesses to close by the end of February 2012, the scene is much different today.
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When I first came here and talked about businesses and people investing in the community, nobody wanted to do it because of that front door.
Bob Hart, former Kennedale city manager
A QuikTrip now occupies the southwest corner of the intersection. To the immediate south is a Popeye’s, and next to it a Burger King. Last fall, a McDonald’s opened across the street. And the city and a developer are about to finalize a deal for a Hilton hotel just west of the QuikTrip along the eastbound service road.
The Kennedale Economic Development Corp. owns 2 acres south of the Burger King that it wants to sell for a sit-down restaurant.
Jack Thompson, executive director of both the Kennedale Chamber of Commerce and — since February — the KEDC, said the redevelopment activity “changes the whole perception of Kennedale” and creates momentum for future development.
According to the state comptroller’s website, city sales tax receipts trended downward from 2010 to 2013, the year after the last adult business closed. They trended upward in 2014 and 2015 but fell again last year.
“I can say overall we’re up from what it was when it was sexually oriented businesses,” said Thompson. “That will bring more development to the city.”
The adult businesses were fixtures for many years: Log Cabin Adult Theater, Dreamers Video, Christal’s lingerie and novelties, Show Time Cabaret, New Video and Fantasy Foxx, which featured nude dancing.
“We had depressed property values, we had crime calls up, we had indecent exposures,” Kennedale Mayor Brian Johnson said.
But there was little the city could do because five of the businesses weren’t in the city limits. They were in an unincorporated area of Tarrant County that was part of Forest Hill’s extraterritorial jurisdiction.
Since many believed the businesses to be in Kennedale, Forest Hill had little incentive to get involved. So in March 1999, Kennedale got creative and offered its neighbor a 20-year-old brush-fire truck in exchange for the 58 acres on which sat five of the businesses. (Show Time, on the southeast corner of Kennedale Parkway and the South Loop 820 access road, was already in the city limits.)
“Forest Hill was in need for one,” former Mayor Robert Mundy, who now serves on the KEDC, said of the brush truck. “It didn’t have much value to us.”
The deal brought the adult businesses under the authority of the city of Kennedale, which then adopted regulations that targeted the businesses and put them in conflict with city zoning ordinances.
The city gave the businesses three years to recoup as much of their investment as they could before they would have to close. When the deadline expired in May 2002, the businesses filed federal lawsuits to block the city’s enforcement of its regulations.
After several years of court battles, the city reached settlements with the businesses, which agreed to close no later than Feb. 29, 2012. Estimates of the cost of the legal battle range from $500,000 to $1 million.
Not everyone wanted to see the businesses shut down. Steve Radakovich, who served a combined 20 years as a council member and mayor through the early 1990s, looked at the issue from a business owner’s perspective.
“They didn’t bother us. They didn’t do anything that wasn’t legal,” said Radakovich, who has operated Hi Way Plumbing in Kennedale for 50 years. But later he had a change of heart. “I thought [redevelopment] was good for future investment.”
Fantasy Foxx was the first of the properties to change hands and uses. In 2008, Sundance Fence & Iron purchased and repurposed the club, which was vacant.
The big redevelopment generator was QuikTrip, which bought the three properties of Chrystal’s, Dreamers and Log Cabin in 2010 to build a convenience store, said Jake Petras, real estate manager for the chain, which he said tries to avoid locating near adult businesses.
“It depends on, can we build and operate a QuikTrip where our customers and employees feel safe?” Petras said. “Out of 130 stores in North Texas that we operate, I can’t think of one that is close to that type of establishment.”
The closest might be the QuikTrip at Everman Parkway and Interstate 35W in south Fort Worth, which is near BT Cabaret. But Petras noted that the interstate separates them.
The Kennedale store, which opened in November 2012, is “one of our better stores in the Fort Worth side of the market,” Petras said. He attributed its performance to Kennedale’s blue-color demographic — “right in our sweet spot” — and its location on heavily traveled South Loop 820.
Next came the Burger King and Popeye’s, immediately south on Kennedale Parkway. The Show Time building across the street was purchased by two doctors who planned to open an emergency care clinic, but they decided to sell it to McDonald’s, which demolished the building early last year and opened its new restaurant in the fall.
“I can tell you that just in the short time I’ve been here, I’ve seen a good bit of interest expressed” about other possible projects, new City Manager George Campbell said. “And I can’t imagine there won’t be a lot more interest if and when and assuming the hotel project is announced.”
‘Bring added value’
The hotel is the next big thing for the city.
Al Karmali of Karmali Holdings said he expects to have a deal finalized in the next few weeks to purchase land from the KEDC and build a 98-unit hotel with room access from an interior corridor. He’s not ready to announce which Hilton brand would be built, but he said the hotel would open in late 2018 or early 2019.
Karmali said he was well aware of the previous occupants of that corner.
“There’s no way we would have done anything there if those adult businesses were there,” he said. “We don’t want to be around that stuff.”
Karmali Holdings is a partner in a 127-unit Hilton Home2 Suites project under construction in Fort Worth, and a partner in a recently announced hotel and 17,000-square-foot retail development in the city of Hudson Oaks, about 25 miles west of downtown Fort Worth
Karmali said he could see adding retail or a fast food eatery in front of the planned Kennedale hotel.
“We want to renovate and revitalize the neighborhood, and bring added value,” Karmali said, adding that the burgeoning development is creating a “gateway to the city.” “If we build a Class A property, hopefully the future development will be Class A.”