The firm behind the Kalispell Centers Mall’s impending redevelopment has returned to City Hall with a reduced request for public funding to help finance the project.  

Parkline Partners LP submitted a new request for roughly $13.9 million in tax increment financing funds last month after pulling its $16.9 million application in May.  

The limited partnership shares an address with Texas-based SHOP Companies, whose development arm owns the Kalispell Center Mall property, according to the company’s website.  

SHOP Development founding partner Daniel Fuller and Executive Vice President Buck Wheeler presented the revised project plans to the city’s Urban Renewal Agency on Sept. 17.   

The smaller request reflects a lower-cost plan to rebuild the mall’s west wall following demolition of the former Herberger’s department store. Parkline Partners scaled back the original design after discussions with city staff and the Urban Renewal Agency, according to Fuller.  

“We completely reimagined the west side, and it removed $3 million of cost out of the project,” he said.  

Rebranding the area as the Parkline District, the developer wants to transform the largely vacant, monolithic-looking shopping center into a more attractive, inviting destination featuring an additional hotel, event space and a mix of retails stores that include national brands.  

The property’s west side will be fragmented into five separate buildings to make the storefronts more visible from the outside. The building slated to house a hotel will likely get fitted with an attached multi-level parking structure, according to Fuller.  

Parkline Partners is still considering locating the future Kalispell branch of the Flathead County Library on the northwest corner of the property. Red Lion Hotel is also part of the redevelopment project.  

"We really want this to be a case study for how these older, outmoded malls can be redeveloped into something vibrant and great,” Fuller said. “There are a lot of people that are really, really excited about this — if it can be pulled together.” 

The $13.9 million would be doled out as reimbursements through the Westside Urban Renewal-Core Area Tax Increment Financing District.  

The funds would go toward public infrastructure and shared utilities, which includes demolishing the former Herberger’s and installing a road connecting Third Avenue West in its place. The money would also fund streetscape improvements on Center Street and Fifth Avenue West.  

Tax increment financing allows local governments to fund improvements in designated areas with struggling or undeveloped properties. As the blighted property is improved and property values increase, the additional tax revenue generated is set aside and can be used by private developers to make future upgrades.  

Assuming the entire property remains taxable, the mall is estimated to rake in $22.2 million in property tax increment revenue through 2050. That figure would fall by $1.8 million if the library is included in the project because it would be tax-exempt, according to Wheeler.  

However, those figures could change because they were based on an earlier design that included park space, which has since been replaced by another retail building.  

The property’s assessed value was $15.75 million in 2025 and is projected to grow to $130.4 million by 2050 because of the redevelopment and rising market values, according to an analysis conducted by Economic and Planning Systems, Inc. The firm was recommended by the city to prepare a third-party report.  

An independent analysis of the application and financial report agreed that the project would not be viable without tax increment financing funds. However, it determined that the developer’s financial position was stronger than what was presented.  

The finding led board member Pete Melnick to ask whether Parkline Partners really needed $13.8 million.  

Fuller responded that he hadn’t seen the report but reminded the board that Parkline Partners cut its funding request in half over the past year. It initially planned to request $23 million.  

“It doesn’t make sense for us to just pay for [Third Avenue West] and pay for streetscape, which are truly public infrastructure things,” Fuller said.  

Wheeler added that Parkline Partners will likely experience a significant loss of income during interior renovations. The company is planning to offer tenants three to nine months of free rent while their businesses are closed. 

“Philosophically I think this is an appropriate use of funds. I just want to make sure that the city is getting the return that it’s investing in,” Melnick said. 

Board member Mike Brodie raised the possibility that City Council could approve Kalispell’s separate $10.4 million request from the same pool of money to build a new maintenance garage.  

“Does one kill the other?" he asked.   

Community Development Manager Nelson Loring described the Westside tax increment financing district as healthy, generating about $8 million a year. He said that money for larger projects would be doled out in phases.  

Reporter Jack Underhill can be reached at 406-758-4407 or [email protected]. If you value local journalism, pledge your support at dailyinterlake.com/support.