Topeka, Kansas, is experiencing dramatic growth because it is America's most centrally located market and the state capital. “With a population of 170,000, Topeka offers a cost of living that falls 7 percent below the national average,” says Douglas Kinsinger, president of The Greater Topeka Chamber of Commerce/GO Topeka. “Also, due to a 1/4 cent sales tax, Topeka has $22 million in economic development incentives available to assist companies. Six major highways, including three interstates, intersect in Topeka making the area attractive to distribution firms.”

Douglas Kinsinger, President/CEO, Greater Topeka Chamber of Commerce/GO Topeka

Topeka also benefits from a strong employment base. While the national unemployment rates have shot up to 6.1 percent, Topeka's rate is 4.2 percent (and has remained consistently below 4.5 percent during 2003).

“Companies like Goodyear Tires, Target Corporation, Hills Pet Nutrition and the Sports Car Club of America have created and retained more than 2,600 new jobs in the city this year,” Kinsinger says. “In addition, we've seen a strong increase in inquiries into our commercial/industrial and warehouse markets, in part due to our aggressive marketing campaign and the $22 million available for incentives. Our residential market is also showing growth.”

According to Kinsinger, Topeka has seen a record number of significant developments this year. Ryan Companies is ahead of schedule on construction of the $80 million Target distribution facility and should be complete by year's end. The facility will have more than 1.3 million square feet of space and will bring an estimated 600 new jobs to the area. In addition, Goodyear Tire & Rubber is investing more than $120 million to retool and renovate 400,000 square feet of production space at its Topeka plant. The Sports Car Club of America has settled into a 20,000 square foot office building at Forbes Field, which completes the relocation of its national headquarters from Denver. Finally, a growing Topeka-based financial services company, Security Benefit Group, recently completed construction of a $50 million, 300,000-square-foot office facility.

“Residential growth has been occurring all around our community,” Kinsinger says. “The density of residential and commercial construction has brought great interest to high traffic corridors such as Wanamaker and Interstate 70.”

Development also is happening at Forbes Field — a former military base. “This area is hot because of the availability of quality space, and proximity to six major highways and interstates such as Interstates 35 and 70, and U.S. Highway 75,” Kinsinger says.

The vacancy rate in the Topeka office market was about 17.9 percent at the end of 2002, according to a survey conducted by Cohen-Esrey Real Estate Services. The survey included approximately 50 buildings with 3.2 million square feet of Class A and Class B space, which represents about 75 percent of multi-tenanted, privately-owned buildings in Topeka.

According to Cohen-Esrey, the medical and dental office sector has 860,000 square feet of space and a vacancy rate of 7.8 percent. This number does not include hospitals, the former Menninger Clinic complex or government buildings. “The medical sector has grown recently, with the addition of Tallgrass Surgical Center’s 91,000 square feet of space at Corporate Meadows in west Topeka,” Kinsinger says.

Cohen-Esrey also surveyed 4.7 million square feet of retail space, representing more than 85 percent of the market, including the White Lakes and West Ridge malls. Occupancy at year-end 2002 was 88.8 percent, and retail construction building starts were at $1 million in 2002. For the apartment rental market, occupancy rates were 88.7 percent for 7,917 units, excluding duplexes and small apartment buildings.

“The Gage Center is an up-and-coming location having been redeveloped into a dining, entertainment and lifestyle center,” Kinsinger says. “Three new restaurants and an upscale cocktail club were added in 2002. Additionally, the River Hill Development promises a bright, new look with upscale shopping.”

While downtown Topeka remains the city's central business district, south Topeka provides affordable space for back office users. “For example, EDS, a global IT outsourcing services company, recently occupied 30,000 square feet at the White Lakes Center,” Kinsinger says. “Development of the new 600-acre Commerce Business Park will provide more opportunities for business growth and development.”

Opus Northwest’s redevelopment of the former 515-acre Menninger Clinic campus is in the beginning stages in Topeka. The new project, River Hill, will have a lifestyle center (developed by Batis Development), residential properties, an office park and a large park area. Opus Northwest is currently locating a group of users that would occupy the 55-acre institutional section of the campus and building a new main entrance into the park.

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