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Market Report

Kansas City Industrial Market Report

Second Half 2019

Lower Living Expenses Pose Positive Yields for Aged Building Stock and New Development

 

Lower living expense than most major markets boosts population and household income growth throughout Kansas City. Kansas city’s year-over-year household income growth is strong in ranking among major United States metros, as the median household income is slightly above the national rate. The attractive cost of living is keeping recent graduates from Kansas City universities within the metro, as well as drawing professionals from out of state. Silicon Valley company ITRenew recently expanded into Kansas City seeking a larger array of skills and resources. The firm will occupy an approximately 315,000-square-foot industrial facility southwest of the metro near I-35. California-based firm Niagara Bottling will open its largest North American facility in Kansas City, a new 420,000-square-foot distribution facility also in the southwest section of the market. It, too, sought out the metro for its large manufacturing and logistics workforce. Though several of this year’s completions are build-to-suit, speculative development continues albeit at a slower pace than 2018. Following a six-year annual delivery average of 5.6 million square feet, net absorption will fail to keep pace raising vacancy for the second year in a row.

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