GSA may set off downtown shuffle Some prospective tenants wouldn't have far to move Kansas City Business Journal - by Jim Davis Staff Writer February 22, 2008

Dave Kaup | KCBJ The General Services Administration hopes to get federal agencies’ lease commitments for the proposed downtown federal office building. Leading the efforts are Brad Scott (from left), regional administrator; Mary Ruwwe, assistant regional administrator; and Mike Brincks, deputy regional administrator.

A proposed federal government office building could bring more than 1,000 new employees Downtown -- but also empty another downtown office building and part of two others.

Brad Scott, the General Services Administration's regional administrator in Kansas City, said he hopes to contact potential tenants for the building within a few weeks.

The largest prospect is the GSA. As many as 1,000 people now working for the federal government's landlord could head to Downtown, Scott said. Those employees are in more than 300,000 square feet at the Bannister Federal Complex in south Kansas City.

The next-largest contingent, 500 to 600 people, already work in Downtown for the Department of Transportation at 901 Locust St.

The DOT is the sole tenant at 901 Locust St., occupying more than 200,000 square feet. The 10-year-old building is owned by a unit of the Southern Ute Indian Tribe of Ignacio, Colo., that buys investment-grade property.

The GSA's tenant solicitation also will include the Department of Homeland Security, now split between 1201 Walnut St. and City Center Square at 1100 Main St., and the Federal Emergency Management Agency at 9221 Ward Parkway.

Scott said the potential consolidation would strengthen Downtown while securing Kansas City's standing as a regional federal headquarters.

The feds occupy 10.7 million square feet in metropolitan Kansas City, nearly half the Heartland Region's four-state total, which also includes St. Louis. The GSA's Kansas City presence also outstrips those of regional GSA headquarters in Chicago (9.1 million square feet), Atlanta (8.9 million square feet), Denver (8.5 million square feet) and Dallas-Fort Worth (7.2 million square feet).

Scott said the building proposed for Kansas City, containing 616,000 rentable square feet, also would provide more downtown parking.

The East Village redevelopment, where JE Dunn Construction Co.'s new headquarters is being built northeast of City Hall, has displaced upward of 2,000 parking spaces mainly used by people working in the Richard Bolling Federal Building, 601 E. 12th St. The proposed building would need about 1,200 more spaces.

Other downtown development probably will further tighten the parking squeeze, Scott said.

"Once you lay in the (Kansas City) Power & Light District, once we secure hockey and basketball for the Sprint Center, once the East Village is laid in, it doesn't take a rocket scientist to know we're going to need parking," he said.

The Downtown Council of Kansas City is continuing to push Uncle Sam to locate the new building in the East Village.

Sean O'Byrne, the council's vice president of business development, said the project would boost downtown retail business and draw other federal agencies and their vendors.

Office brokers said the new building's effect would be mixed.

Debora Field of Zimmer Real Estate Services LC said that extinguishing almost 275,000 square feet of downtown leases would burden "a market that's already extremely soft and not rebounding soon."

Tim Schaffer of RED Brokerage LLC said he expects Downtown's overhaul to generate office demand by the new federal building's anticipated opening in late 2011. Space vacated by the feds could ride this wave, he said.

The 1201 Walnut building, home to Great Plains Energy Inc. and Stinson Morrison Hecker LLP, has one of Downtown's highest occupancy rates. City Center Square's vacancies are higher, but the building is next door to the Power & Light District. The 901 Locust building was developed for the government but could attract another user.

"The federal government competes, just as the private sector does, for labor," Schaffer said, "and a big part of attracting that labor is having a great environment for people to work." [email protected] | 816-421-5900