Downtown office vacancy

Issues concerning Downtown as described by the Downtown Council. River to 31st Street, I-35 to Bruce R. Watkins.
earthling
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Re: Downtown office vacancy 2016

Postby earthling » Thu Feb 16, 2017 1:56 pm

Downtown KC ranked 4th for best improvement on vacancy in 2016, though partly due to building conversions. It's not like suburban companies finally see the light that downtown is fuck'n IT right now but still good improvement.

http://www.bizjournals.com/kansascity/n ... -down.html

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Casey Davison, Midwest communications specialist for CBRE, said that compares to a 22.4 percent vacancy rate in Downtown just five years ago.

The current rate of 15.6 percent is the submarket’s lowest rate since 2002.

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Re: Downtown office vacancy

Postby earthling » Mon Apr 10, 2017 12:43 pm

CBRE's Q1/2017 Office report. Downtown overall improves a bit to 14.2% vacancy from 15.6% previous quarter. Class A improves a bit to 13.1% from 13.9%. Not exactly a great pace to entice speculative building but at least in the right direction.

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Re: Downtown office vacancy

Postby earthling » Tue Apr 11, 2017 9:36 am

Curious that it doesn't show active construction in South KC. Cerner completed some buildings but are there not any active right now?

edit: Come to think of it, that's not 'leasable' space under construction, which CBRE tracks. Colliers tracks all construction but no Q1/2017 report yet.

edit2: This is Colliers' Q4/2016 report showing over 800K construction in South KC, essentially all Cerner..

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Let me know if these images don't show up.

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Re: Downtown office vacancy

Postby earthling » Tue Apr 11, 2017 2:44 pm

Biz Journal report on downtown office vacany improving significantly since 2013...
http://www.bizjournals.com/kansascity/n ... ummet.html

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Re: Downtown office vacancy

Postby earthling » Wed May 17, 2017 4:34 pm

Collier's Q1/2017 office report...

Highlights:
- Downtown vacancy overall just slightly improved to 10.2% from 10.3%
- Downtown Class A vacancy went up a tad though, some new buildings/space went online
- Plaza/Midtown vacancy slightly improves to a very low 5.1%
- South KC (Cerner) added 805K sqft last quarter alone, metro added over 1M sqft
- Metro vacancy at a long term low of only 9.4% even though much more space than comparable metros

http://www.colliers.com/-/media/files/m ... office.pdf

Click link above for better view.
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Last edited by earthling on Fri Jul 07, 2017 9:10 am, edited 1 time in total.

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Re: Downtown office vacancy

Postby KCtoBrooklyn » Tue May 30, 2017 2:34 pm

DST is adding 415 jobs:
http://www.bizjournals.com/kansascity/news/2017/05/30/dst-alps-argus-employment-expansions.html

I don't see a mention of where those jobs will be located, but I am assuming these will be going in existing DST buildings. That should help improve vacancy a bit.

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Re: Downtown office vacancy

Postby earthling » Fri Jul 07, 2017 7:25 am

CBRE Q2/2017 report. Claims downtown and metro vacancy actually went up from Q1. They don't track as many buildings as Colliers. Colliers report usually takes a while.

http://www.cbre.us/people%20and%20offic ... sas%20city

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Re: Downtown office vacancy

Postby earthling » Mon Jul 10, 2017 11:53 am

Downtown summit to address downtown jobs...

http://cityscenekc.com/summit-to-examin ... ctor-jobs/

“The first wave of downtown’s revival has been residential, there are now 25,000 people living downtown. The second wave has been hotel development with an expected 2,000 rooms coming over the next couple years.

“We believe we’re in the third wave, office redevelopment. The purpose of the symposium is to explore the challenges and opportunities and what it will take to bring more offices downtown.”

Between 2001 and 2011, a time when major public investments were being made downtown including the Sprint Center and Power & Light District, and dozens of buildings were redeveloped as apartments, the downtown Kansas City actually lost more than 16,000 private jobs, a 19.6 percent decline.

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Re: Downtown office vacancy

Postby NorthOak » Mon Jul 10, 2017 1:22 pm

I spoke with someone from Cerner this week at lunch. I know the guy pretty well.
He is a former MO politician, lobbyist and is now with Cerner.
He lives in Belton, I won't mention his title but he is a C level player and reps Cerner nationally and internationally.

I mentioned the idea of Cerner doing something big downtown and the slight possibility that the 87th St campus not being fully built out. He actually bristled and was offended. He then went on to trash downtown, the city of KCMO and said Cerner will never, ever do anything downtown from his perspective. He mentioned how there was discussion with Cleaver (yeah way back in the 90's) and Cerner working with the city doing something downtown. He claims that Cleaver repeatedly blew them off as "small potatoes" and completely dismissed them. Not a single incentive or help was offered, not even a possible location for further discussion. He said Cleaver came across as a complete novice and local "Boss" idiot. He went on to say it all made sense looking back as Cleaver knew little about business. He had scammed a low-interest Govt loan under the guise of inner city revitalization, didn't pay taxes, the car wash eventually went bankrupt, etc, etc...

I asked him about now...."what about today?" "It's a different city, different downtown, different leadership."
I mentioned how millennials seem to want an urban experience and lifestyle over the burbs, etc.
He said they had obviously developed relations with the city again and had made a significant investment in KCMO.
He claims he has not heard, nor has had any discussion with a single person at Cerner in having any interest at all in downtown. Granted, this guy was still clueless about downtown, urban life, amenities, etc. But there seems to be a real bias against downtown that was ingrained long ago. Cerner itself seems pretty childish to hold a grudge from back in the 90's.
aknowledgeableperson is currently on your ignore list.
You will no longer see any of her posts.

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Re: Downtown office vacancy

Postby earthling » Mon Jul 10, 2017 2:38 pm

I wonder what the feedback is from employees in the new campus. I know several working for Cerner but none at new campus.

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Re: Downtown office vacancy

Postby flyingember » Mon Jul 10, 2017 3:15 pm

This guy isn't stupid, he knows downtown is irrelevant and they've helped keep jobs in KCMO. Their Bannister campus cuts the commute for TONS of workers that JoCo is as easy a commute as downtown.

How someone can get to work is as important as where it is for downtown jobs, and places like Cerner.

Second Creek is the same the same distance of drive to their legends campus as downtown. The only bus line anywhere near the area, and it goes downtown only, just got downgraded from every 20 to every 30 weekday peak. Think about that. Now it's HARDER to get downtown if you don't own a car. This makes it easier and preferred to drive to work.

The first step for downtown jobs isn't to gain employers, it's to measure commute times and work on cutting them. Existing density can not be the definition used but time taken and alternatives the same time frame. Start with the places where we can add transit service and speed up someone's commute with bus lanes, HOV lanes, signal priority, express routes, rail and the like. If someone lives in Shoal Creek or Liberty it should be quicker to get downtown than to take 435 to the Bannister campus and I doubt it is.

Transit doesn't need density to succeed, it needs enough riders that find the bus helps them zoom by traffic. We need ridership to be able to afford to improve suburban lines.
I said it already this week, remove the need for a northland rider to transfer to get to a job further south than 27th as a first step and watch ridership increase. Our bus system is designed in four parts and almost exclusively ends lines downtown.

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Re: Downtown office vacancy

Postby earthling » Thu Jul 13, 2017 7:48 am

Downtown Summit comments...

Gib Kerr, vice president at Cushman & Wakefield, said downtown has seen a major influx of residents over the past decade and if current rates continue, should reach 30,000 residents by 2020. It currently has about 25,000 residents, twice the population of downtown Austin, Texas, he said.


Well that's Greater Downtown between State Line and 71Hway to 31st, anyone have River Market to Xroads pops?

Kerr estimated 2.3 million square feet of former downtown office space has been converted to apartments and hotel space over the last three years, roughly the size of the Sprint Campus.


Besides Auto Alert, other major recent office deals including the federal General Services Administration, 140,000 square feet; Spring Venture Group, 130,000 square feet; Hollis + Miller, 33,000 square feet, and WeWork, 44,000 square feet.


And will probably continue to be difficult to attract large tenants (over 1K employees) downtown given free parking in the burbs and not great metro transit. But looks like a 400 employee law firm considering downtown, might be Crown Center given another tenant about that size moving into CBD...

Johnson said he’s currently representing a firm with 400 employees that’s interested in relocating from Kansas to downtown and is optimistic the deal will happen.


John Southward of Hollis + Miller said relocating to the Corrigan Station project proved popular with his employees. “Our younger staff embraced it,” he said. “They live in the River Market and take the streetcar here. It’s been fantastic.”


Would be good to hear what % live downtown.

One of the more interesting debates among the panelists was the need for parking downtown. Johnson of Colliers said it was still essential to provide adequate parking to attract tenants, saying “I think parking could be a deal stopper going forward.”


Indeed.

On Cerner not choosing downtown...
“In our conversations with Cerner, the CEO (the late Neal Patterson) was focused on a suburban development,” Schulte said. “He didn’t see his organization interested in downtown. He wanted parking and wanted to be to his suburban home in 15 minutes.”


https://cityscenekc.com/developers-conf ... o-tighten/

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Re: Downtown office vacancy

Postby kcjak » Thu Jul 13, 2017 8:25 am

Anyone have stats on where KC ranks for downtown population compared to other peer cities (or even larger cities)?

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Re: Downtown office vacancy

Postby earthling » Thu Jul 13, 2017 8:32 am

Last I saw Minneapolis is near 40K and Denver is over 70K for Greater DT, Indy about 28K, STL is about 18K for Greater Downtown. KC is about 25K for Greater Downtown with units under construction/approved to reach 30K but would be interesting to see RM to Xroads. Of course every downtown definition has different sq miles.

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Re: Downtown office vacancy

Postby earthling » Fri Jul 14, 2017 8:37 am

Forbes claims KCMO ranks #2 in creating business service jobs (% growth). Oddly, it looks like they are comparing KCMO city to other metro areas. The stats they show for KC are not for metro area yet others listed are metro.

https://www.forbes.com/pictures/594d7dc ... 801960890d

https://www.forbes.com/sites/joelkotkin ... 9152324e9e

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Re: Downtown office vacancy

Postby JBmidtown » Fri Jul 14, 2017 10:33 am

earthling wrote:Forbes claims KCMO ranks #2 in creating business service jobs (% growth). Oddly, it looks like they are comparing KCMO city to other metro areas. The stats they show for KC are not for metro area yet others listed are metro.


Do you think that gives KCMO a statistical advantage or disadvantage in the rankings? If the urban core is outpacing entire metro areas that could be impressive IF those metro areas don't have dead zones for growth that are distorting their own figures.

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Re: Downtown office vacancy

Postby earthling » Fri Jul 14, 2017 10:41 am

Hard to say but for a couple years now KCMO has been on a roll with white collar job growth and JoCo has stagnated. So KC metro may not rank in top 10 when comparing apples/apples at metro level.

Another interesting point is that it says KCMO employment was about 470K end of 2016. BLS says MO side of KC metro was 610K and metro as 1083K at end of 2016, so KCMO represents about 77% of MO side employment and about 43% of metro employment.

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Re: Downtown office vacancy

Postby earthling » Tue Aug 08, 2017 7:23 pm

Colliers Q2/2017 office report out. Collier's claims downtown Class A vacancy is 14.8%, improved 2% from 16.8% in Q1. Overall downtown vacancy improved to 9.3% compared to 10.2% in Q1. Class A vacancy might need to get down to 12% before developers would consider speculative building (no tenant committed).

http://www.colliers.com/-/media/files/m ... office.pdf

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Re: Downtown office vacancy

Postby earthling » Thu Aug 24, 2017 10:03 am

Colliers national office report, can compare KC to other markets. For some reason they include Plaza/Midtown as part of downtown...
http://www.colliers.com/-/media/files/m ... lliers.pdf

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Re: Downtown office vacancy

Postby flyingember » Thu Aug 24, 2017 11:38 am

earthling wrote:Colliers national office report, can compare KC to other markets. For some reason they include Plaza/Midtown as part of downtown...
http://www.colliers.com/-/media/files/m ... lliers.pdf

I bet there's some apples to apples reason for this if it's a national report

rents for urban space went up 3.2% while suburban went up 2.0% in the past year

that's a good sign for urban demand


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