“Speculative development of office space in the Kansas City metropolitan area is, for the most part, on hold as vacancies reach double digits,” says Joyce Murray, a sales associate for The Zimmer Companies. Especially hard hit are southern Johnson County, Kansas, and the central business district (CBD) of Kansas City, Missouri.

The development and completion of the 4 million-square-foot Sprint World Headquarters Campus has unloaded over 300,000 square feet of sublease space onto the Kansas City market, of which approximately 100,000 square feet have been absorbed.
The development of the 600,000-square-foot building for Shook Hardy Bacon Law Firm at Crown Center will be taking more than 400,000 square feet out of an already moribund CBD.

Recent major lease signings include 600,000 square feet for Shook Hardy & Bacon, LLP on Grand; 133,000 square feet for Midland Loan Services in Corporate Woods on Mastin Boulevard; 125,000 square feet for Blackwell Sanders Peper Martin on Main; and 75,000 square feet for Aquila on Walnut.

Class A rental rates range between $24 and $28 per square foot with vacancy rates at 15 to 20 percent without subleases and 20 to 25 percent including subleases.

Areas to watch are Northland, north of the Missouri River, Lee’s Summit in southeastern Jackson County, Missouri, and Southern Johnson County in Kansas.

“As vacancies hover in the double digits, Kansas City is a tenant’s market,” Murray says, “with outstanding values in A and B spaces over the entire metropolitan area.” Retail and housing starts are at a feverish pitch. Prospective tenants can find excellent incentives available in both Missouri and Kansas for businesses relocating to those states.

Joyce Murray serves as a sales associate – office with The Zimmer Companies.


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