2015 KC RETAIL REPORT 2015 2 NORTHWEST KANSAS CITY NORTHEAST KANSAS CITY IKEA Metcalf South Shopping Center (circa 1980) Merriam, KS Overland Park, KS WYANDOTTE COUNTY RELATIVE CHANGE FROM PRIOR YEAR EASTERN JACKSON OR OR LR LR Power and Light District have all benefitted from the COUNTY RECENT SUBMARKET steady increase in residential density driven by the robust CENTRAL OCCUPANCY RATE LEASE RATE KANSAS CITY multi-family market. NORTH JOHNSON ACTIVITY Perhaps most notably, the locally owned and beloved COUNTY NORTHWEST KANSAS CITY Hall’s Department Store expanded their existing store 2014 was a year characterized by ‘cautious led to a significant increase in transaction in Crown Center, which is part of Hallmark’s world OR LR Due to its location at a highly headquarters, after closing their location on the Country optimism’ from retailers who are trying volume, fueled by low interest rates and pent SOUTH regional intersection, the Northwest Club Plaza. Future redevelopment of the former Plaza 0.5% 2.2% KANSAS to maximize their returns from brick-and- up demand from both buyers and sellers. submarket of Kansas City has been a location will likely include dividing the large space to fit SOUTH CITY mortar locations. Slow but steady economic Institutional buyers interested in well- consistently stable retail market. Centered at Interstate JOHNSON smaller format retailers and offices. COUNTY SOUTHEAST conditions are reflected in the retail market, established markets with stabilized shopping 29 & Barry Road, many retailers continue to see strong TRADE AREA with some key areas experiencing growth, centers invested heavily in the Kansas City sales despite the fact that access to most regional centers SOUTH KANSAS CITY at this intersection is less than ideal. while most markets remain stable. Metro throughout the year. Notable shopping OR LR The South Kansas City trade area is center sales include First Washington Realty, In 2012, work began on a $40 million sewer project in set for an exciting decade of growth, the area north of 152 Highway, between I-29 and 169 0.4% -1.1% spurred by the development of a new In 2014, the occupancy rate for the entire Inc.’s purchase of 130,000sf of retail and quadrant of the intersection, has been nearly 100% In Blue Springs, look for redevelopment this year of White Highway. Serving as a catalyst to residential growth, this $4.45 billion Cerner Corporation campus. Located on Kansas City Metro decreased only one tenth office space in the Brookside Shopping leased for the last several years. On the adjacent Oaks Shopping Center at the intersection of Highway 40 sewer project will open up approximately 13,000 acres a 290-acre site, the 16 building, 47 million square-foot of a percent from 89.9% to 89.8%. Lease Center, located just south of the Country Club quadrant, Summit Fair is reportedly at 95% occupancy, and Highway 7. This proposed $50 million development for development in the coming years. As the population office development received $1.47 billion in incentives rates also remained relatively stagnant while Plaza, as well as BIG Shopping Center USA’s it’s highest rate since opening in 2009. Expect will reportedly be anchored by a new 85,000sf Price base fills in areas previously void of rooftops, this area and will be one of the largest economic development announcements about more retail openings at Summit Chopper grocery store. dropping from an average of $12.88 PSF purchase of Creekwood Commons at the SWC will become one of the hottest “future” residential areas projects in the state of Missouri ever. The 16,000 new to $12.85 PSF. Regardless of the lackluster of Englewood Road and North Oak Trafficway in the Kansas City Metro. Fair in 2015. health information jobs projected to be created over NORTH JOHNSON COUNTY statistics, the general market pulse is in North Kansas City. Expect to see local the next ten years will likely have a positive impact on Summit Place, a proposed shopping center anchored NORTHEAST KANSAS CITY increasing as retailers continue to eye new and institutional buyers continue along the the trade area, which is in need of rejuvenated retail by Sam’s Club just north of Summit Fair, is still in the OR LR In September, IKEA opened its doors opportunities in well-established markets. same path in 2015, as the investment market The Northeast submarket, which after Bannister Mall went dark and was subsequently development phase but will likely receive a boost from a to the Kansas City Metro, arguably OR LR -1.6% -3.4% the most notable retail opening of volumes bounce back after the recession. is highlighted by the strength of demolished on the current site. Some retail is expected recently approved incentive package. 8.5% as part of the development plan, but details on project 2014. The Swedish retailer sits just south of Merriam Various data measures consumer confidence -2.3% the City of Liberty at Interstate 35 Fueled by strong schools, population growth and solid scope and prospective tenants are yet to be determined. Town Center on the former site of Merriam Village, a & 152 Hwy, remains a top market in the metro and is demographics, retailers have increasingly regarded the at its highest point since 2007-2008. This is From a retailer perspective, some of the most shopping center that was built and never leased after almost always targeted by national retailers looking “up and coming” Belton/Raymore market as a target a strong indicator of an improving economy, active users included specialty grocers, fitness Ward Parkway Shopping Center, located at 87th Street & Circuit City declared bankruptcy in 2008. Hobby Lobby to expand. On the horizon for the City of Liberty is the State Line Road, has sustained another strong year after market for expansion. Academy Sports + Outdoors was which will likely translate into increased centers, and fast casual restaurants. There is is planning to open a new location adjacent to the IKEA redevelopment of the former Kmart anchored center among the notable retailers to open in 2014 in the a successful renovation. Yet to be developed is the now in 2015. consumer spending, providing an optimistic one common theme between these retailers at I-35 and 152 Hwy, into Liberty Commons. This empty pad lot on the south end of the center, where the City of Belton, which predominantly lies on the west landscape for retail sales. that should be noted – they are all ‘internet- development will create new prime retail locations in former Dillard’s building was razed. Due to the strength side of I-49. Menards plans to start construction soon One of the interesting stories of 2015 will be LANE4’s proof’. These users are expected to continue Liberty, where only secondary and tertiary spaces have of the area neighborhoods, it is likely that plans for an across the street from Academy, on the newly improved partnership with The Kroenke Group and their pursuit Top-tier locations with strong demographics, to be active in the coming year as their been available for a number of years. additional development are in the works. interchange at I-49 and Y Highway. to redevelop two prominent retail shopping centers visibility, and access continue to lead the way. business models prove effective. Expected to open in early 2015, the new Sam’s Club on at the intersection of 95th Street and Metcalf Avenue, In the heart of Grandview, along Interstate 49, Truman EASTERN JACKSON COUNTY totaling approximately 60 acres of land. Sitting in the With very few of these spots available, they the west side of I-35 just off of Flintlock Road is near Corners Shopping Center awaits redevelopment into heart of Overland Park, Metcalf South Mall and the completion. This will be Sam’s Club’s seventh location in The Eastern Jackson County trade command premium rental rates. Meanwhile, With the exception of several key infill parcels, Truman’s Marketplace. Notable additions TJMaxx and OR LR former Kmart center are ripe for a change after years of the Kansas City Metro and will be the first large format area is home to Independence the future direction of retail is uncertain, new retail development opportunities are Petco will join existing anchors Burlington Coat Factory decay. The development team is planning a retail and wholesale retailer in the Liberty market. 1.2% -9.7% Center, Kansas City’s second best making ever-moving targets out of expansion likely to remain low in volume until rental and Price Chopper. After multiple delays, the project is mixed-use project, and expects to present preliminary performing indoor mall (in terms of sales PSF). This mall models as technological advances and rates increase enough to justify the high cost expected to commence construction in 2015. redevelopment plans to the city in the first quarter of CENTRAL KANSAS CITY and the peripheral power centers remain a very strong e-commerce continue to have an impact on of new construction. In the meantime, expect 2015. The Central Kansas City submarket SOUTHEAST TRADE AREA market where retailers continue to post healthy sales. LR consumer trends. to see more redevelopment and revitalization OR (LEE’S SUMMIT, RAYMORE, BELTON) Further west on 95th Street, Oak Park Mall continues to has been a bright spot for both Gaslight Shopping Center was demolished in 2013 to of existing retail shopping centers. 0.9% “ be the highest performing enclosed mall in the Kansas -9.0% residential and commercial growth Lee’s Summit’s retail market is make way for a new Walmart Neighborhood Market at OR LR City market (based on sales PSF). On the NW corner of An active 2014 retail investment sales market recently.