MIDDLE MARKET HIGHLIGHT, AUGUST 2006

Wichita, Kansas
Dan Marcec

Throughout Wichita, commercial real estate development has been dynamic. Retail development is booming, and the manufacturing industry continues to maintain its stronghold. With the residential markets growing out both to the east and to the northwest suburbs, the outside areas of Wichita are seeing a much higher concentration of development that has been uncharacteristically successful.

“Wichita really has two relatively distinct areas, whereas the suburbs originally spread to the east, the affluent population also has cropped up in the northwest quadrant of the city,” says Allen Bell, economic development director for the city of Wichita. “This dynamic has given retailers options in several submarkets, thus strengthening their presence across the city and sparking interest with companies that had not previously seen Wichita as an option.”

To that end, three major lifestyle centers are in the process of building out, each consistent with the residential growth in their respective areas. The first of these lifestyle centers to come online was Bradley Fair, located on the east side of Wichita. This project is significant to the local market because it was able to draw high-end retailers that traditionally had overlooked the city. Second, NewMarket Square was constructed in the northwest quadrant of the city, giving these higher-end retailers a home for a second location. Bradley Fair is relatively close to being completely built out, while NewMarket Square continues to add to its land holdings and expand the shopping center. The third lifestyle center, The Waterfront, is just coming online. This property is further east than Bradley Fair, in an area that is just developing in terms of residential growth. In the meantime, three or four areas in town are still developing big box centers, which have been thriving as well.

Aside from the retail projects flourishing on the outside of Wichita, development is ramping up in the downtown area as well. The downtown sector has been undergoing a slow revitalization during the past 15 years, and a major redevelopment project called WaterWalk currently is underway. When all is said and done, the $120 million project along the Arkansas River will include residential, office and retail space, in addition to public venues, an amphitheater and other water features. Gander Mountain, a big box outdoor retailer, already has opened anchoring the project. In addition, development of a 15,000-seat indoor event center is underway, with construction beginning in early 2007 and completion expected by the end of 2008.

“Our economic development strategy over the last years has been diversification of our economy,” Bell says. “While we want to diversify within the manufacturing industry, we also want to spread to other sectors, targeting high-tech businesses, corporate headquarters and professional service offices.”

In particular, the aviation industry is a huge draw in Wichita. Boeing recently sold one of its larger plants in the city, which manufactured components for almost all of its commercial aircraft as well as for military aircraft. A Canadian investment group purchased the plant, utilizing it for Boeing commercial operations as well as providing parts for other aircraft manufacturers. Coleman, the outdoor company, has its headquarters in Wichita and also maintains a major manufacturing plant. York Air Conditioning employs approximately 1,500 people in the area as well.

“The aviation industry will continue to grow naturally because of the manpower and infrastructure we already have — 50,000 to 60,000 people in Wichita have jobs that relate directly to aviation,” Bell explains. “We’re hoping to branch into new types of composite and advanced materials in aviation, and the professional service industry looks to move forward as well.”

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