KCRag Forum

Q1 2015 - Downtown Class A vacancy still at 20% (not good) according to Colliers, but including Class B/C, total downtown is at 13% (not bad but not good enough to attract developers). Colliers tracks more buildings than other reports. Metro vacancy only 11%.

KC Metro report Q1 2015...
http://www.colliers.com/~/media/files/M ... ffice.ashx

KC compared to all metros (for 'downtown', they include midtown/plaza)...
http://www.colliers.com/en-us/-/media/F ... Office.pdf

How much Class A office space did the Feds soak up? Did the Feds go into any B or C? If the vacancy rate is at 20% after the Feds ...

We are getting closer. What percent would definitely start building at for class A?

I'm not sure of economics of today but in past speculative building might occur when Class A vacancy below 12%. Downtown KC no where near approaching that, has been hovering 20% A vacancy for years.

As far as Feds, they did take up Pershing Square space next to Union Station, which is Class A. I used to work in that building, very nice.

Even if the vacancy gets to below 12% I doubt anyone would build a 100% speculative office building. There is always going have to be some commitments to take up 50% or so of the new space.

aknowledgeableperson wrote:Even if the vacancy gets to below 12% I doubt anyone would build a 100% speculative office building. There is always going have to be some commitments to take up 50% or so of the new space.

And it's ideal to no longer have only office space in a building anyways but be mixed use.

Hopefully the next major project downtown looks more like Chicago where you have a ground level entrances for small shops, a lobby for the office between them, a larger retail space on the 2nd or 3rd floors with dedicated entrances and shared elevator, a parking garage below ground or in a connected shared structure and offices and/or residences above all that.

[url]http://www.bizjournals.com/kansascity/n ... s.html/url]
"KC office market gets good, bad news" - KCBJ

Question.

Do buildings like the Brookfield (sitting totally vacant and unmarketable for occupancy until totally rehabbed) count against/towards the vacancy rates listed here?

From what I understand buildings counted under vacancy rate are only those currently on the market to rent out.

Here's the Q2/2015 Colliers report. Downtown Class A vacancy edged down a bit better to below 20% finally. Overall downtown vacancy barely improved to 13.2%. Metro vacancy improved slightly from 11.1% Q1 to 10.9% Q2.

http://www.colliers.com/~/media/files/M ... ffice.ashx

Here is STL for comparison... Curious that Downtown STL to Clayton stretch has 34M leasable office space. Downtown KC to Plaza is 35M. Though STL has more Class A...
http://www.colliers.com/-/media/files/u ... 015_q2.pdf