Kansas City is experiencing an era of unmatched growth and development, thanks in large part to a number of "supercharger events" identified by industry experts at MetroWire Media’s 2023 Market Forecast Summit panel discussion.
“Chiefs win the Super Bowl twice in four years. We are opening up a $1.5 billion new airport terminal in two weeks… This is absolutely the best time in the history of Kansas City. We’re living it — we’re part of it right now,” said Tim Cowden, president and CEO of the Kansas City Area Development Council.
Cowden, as moderator, was joined by panelists Brandon Buckley, vice president of LANE4 Property Group; Katherine Carttar, executive director of Urban Land Institute Kansas City; Monica Enloe, associate of Clemons Real Estate; Jon Stephens, president and CEO of Port KC; and Erik Wullschleger, partner of 3D Development.
According to Stephens, Kansas City is at the forefront of the industrial and logistics sector with its advanced distribution centers and logistics.
“We’re at the crossroads - the literal crossroads of transportation and access to not just America but to the entire North American market,” he said. However, with this growth comes challenges, Stephens said, including the need for more rail-served access and more workforce.
According to Buckley, the vacancy rate in the industrial market is approximately 3.8 percent. Buckley cited a recent market report by Newmark Zimmer which placed Kansas City as the country’s 31st largest metropolitan statistical area by population, but 15th overall in industrial market size.
Although the unemployment rate in the Kansas City metro is below the national average, Stephens said there are 3.2 million fewer Americans in the workforce today than there were in March 2020.
“We need the equity and agility to bring people back into the workforce in an equitable way because there are neighborhoods in Kansas City that are still in double-digit unemployment, double-digit poverty,” said Stephens.
KC "supercharger events," not only include the upcoming NFL draft, the World Cup and the opening of the new KCI Airport terminal, but also the KC Streetcar expansion.
“Not only will the expanded streetcar line allow tourists to navigate Kansas City’s sprawling geography without the need for a car, but it also will spur a significant amount of redevelopment, said Enloe.
“We’re seeing a lot of projects being announced and shovels in the ground now … And, I think it’s going to really change the landscape up and down Main Street and put us on par with cities that feel more urban than Kansas City in terms of utilizing public transportation and utilizing our vehicles less,” she said.
In the last 20 years, housing in downtown Kansas City, Mo. has more than doubled, according to Carrtar, and demand remains steady. Other downtown areas of the metro also are experiencing slow and steady growth in their multifamily markets, including Overland Park and Kansas City, Kan.
According to Enloe, western Johnson County, Kansas, particularly the De Soto area, presents huge opportunities for multifamily development. Buckley said De Soto remains an area to watch in terms of all development because of the Panasonic Energy of North America battery plant under construction, which will bring 4,000 jobs.
Although there continues to be much talk about moving the baseball stadium downtown, there are a lot of conversations that still must be had, said Carrtar.
“One of the things we’ve learned is that you don’t place a stadium and hope for development around it. You build it as a component of a larger vision and a larger plan and that includes community stakeholders, neighborhoods, residents connected by nonprofits, transportation, all of it. I’m very optimistic that we’re seeing that process play out even though maybe it isn’t always the simplest, cleanest process when it’s of public domain, public conversation,” said Stephens.
In addressing the office market, Wullshleger said offices with smaller footprints and high-end amenities continue to be in high demand.
“And so, you’re seeing us taking a 20,000-SF plate and figuring out how to chop it up creatively into anywhere from 1,000 or smaller up to 5,000-SF plates. We think those are the kinds of businesses that are really coming back in,” said Wullshleger.
Cowden said once the new airport terminal opens, the impact on Kansas City will be huge.
“We are now going to have an asset that truly equals the high experience factor that we all know about Kansas City. It is going to really, really accelerate this place that we all love,” said Cowden.
Kansas City continues to attract increased investments from out-of-region developers. Kansas City is much more affordable in terms of investment returns than on the coasts, said Enloe.
“We were working with a restaurant entertainment consultant out of Chicago. And what he tells us is his friends are tired of hearing about Kansas City now. I think it's one of those things where it's hard to get somebody here to believe and see it, but once they do, they can't shut up about it,” said Wullshleger.
With all the success Kansas City continues to experience, there remain portions of the metro area that are underdeveloped or underserved, including Kansas City’s east side, where job training and transportation issues need to be addressed, said Stephens.
Stephens also said that he is focused on assembling and reclaiming land in the Blue River Corridor, revitalizing it and bringing jobs back to that corridor which once was a manufacturing industrial center.
The panelists also discussed the opportunities for Kansas City that will come with the World Cup, which, according to Cowden, is going to be bigger than we think it is going to be.
“Kansas City has never been an international city, but the World Cup will change that. It has already changed everything as far as opening doors at a global level, Stephens said.
“We’re going to put on a great show. If I know one thing about Kansas City, it’s hospitality —and we’re going to win the hospitality game. We just will. People are going to love our city.”
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FEATURE PHOTO CREDIT: ARCH PHOTO KC