Availble online now is the 2019 edition of The Real Estate Report, Metropolitan Kansas City. The experts at Block Real Estate Services, LLC (BRES) have assembled the most comprehensive annual evaluation you will find for the commercial real estate market in the Kansas City area. If you are contemplating a real estate transaction in 2019, this report will provide valuable information to assist you in making the best decisions.
In 2018, Kansas City generally experienced a
strengthening across all product types and submarkets.
- Class A Office market vacancy dropped to 8.1% at the end of 2018, down 0.6% from the same time in 2017. This 8.1% vacancy rate represents the lowest rate for the Kansas City market in the past 17 years. During 2018, over 350,000 square feet of new Class A construction was delivered in the area with absorption out pacing delivery by approximately 50,000 square feet. Average rental rates climbed $0.24 to reach $22.58 at year end. BRES is set to deliver it’s first of four office buildings at CityPlace in 2019. The 120,268 square foot, four-story, Class A building is expected to be completed in June 2019 and plans are already underway for the second 120,000 square foot Class A office building.
- Growth in Kansas City’s industrial market is being driven by the brick and mortar retailers rush to cut delivery times and transportation costs, raise their ecommerce capabilities, and compete with a changing landscape driven by Amazon. By the end of 2018, over six million square feet of net absorption had occurred, and the vacancy rate dropped 1.2% from the same time last year to 4.4%. Leasing activity in 2018 included Turn5 Inc., an ecommerce retailer in the aftermarket automotive parts industry, leasing of 363,063 square feet of the 635,834 square foot BRES developed in Lenexa Logistics Centre North Building 1 in August of 2018.
- Retailers continue to embrace omni-channel strategies to reach the consumer on every digital device they touch. While shopping for daily commodities has, and will continue to, become more streamlined with self-pay stations in stores and one-click ecommerce purchases with same-day delivery, the opportunity to find great products while socializing with others at brick and mortar stores won’t be going away anytime soon. Overall, vacancy rates rose across the metro, moving from 5.3% at the end of 2017 to 5.9% at the end of 2018, while average rental rates rose $0.59 to $13.56.
- The Kansas City multifamily market continued to grow with the delivery of 1,935 units in 2018 bringing the total to 144,035 for the market. Average vacancy decreased 1.2% to 6.7% across the market with a 1.6% increase in market rents. BRES continues to be active in the multifamily market with multiple developments in process contributing to the 8,357 units currently under construction, including: Galleria 115, 4400 Washington, The Clearing at Anderson Pointe, and The Apex at CityPlace.
Our
annual market report takes an in-depth look at each of the above sectors and will
provide you with a thorough understanding of the Kansas City commercial real
estate market. If you are considering real estate transactions in other markets,
BRES’s team of experts can connect you with one of our affiliates to seamlessly
incorporate the broadest and most accurate data available into your decision
process. Our entire team stands ready to answer your questions and help you
obtain a clear vision of commercial real estate in Kansas City or anywhere across
the country.
A digital version of this report is also available at: www.blockllc.com/marketreport
