KANSAS CITY—As recently reported in GlobeSt.com, this Midwest city has experienced an industrial boom in the past few years. And today, Chris Gutierrez, president of KC SmartPort, a nonprofit economic development organization, tells GlobeSt.com that every sign points to a continued expansion of the industrial sector, especially in product distribution, which has become a regional specialty.
“The Kansas City area over the last five years has seen on average about four million square feet of speculative space built each year,” he says, or 20 million square feet in total. Furthermore, users have absorbed that space almost as fast as developers have put it up. “It's just been an incredible run of supply meeting demand.”
The latest milestone for this burgeoning region was Amazon's recent decision to fully occupy NorthPoint Development's new 822,104 square foot speculative development at Logistics Park Kansas City in the Kansas suburb of Edgerton, the largest spec development ever built in the region. Having the market leader in product distribution take the most ambitious spec project to date “was the great cherry on top of all the successes that we have had over the last three to four years,” says Gutierrez.
The reasons for all this success are not hard to discern. FedEx and UPS have both long considered the city a keystone in their national distribution networks. And the rise of e-commerce has simply made the area even more desirable due to its central location. “If you've got one e-commerce facility in this country, it should be in Kansas City,” says Gutierrez.
Rail companies have also responded by building huge intermodal facilities like BNSF's at Logistics Park Kansas City. Further boosting the region was GM and Ford's decision a few years ago to pour about $2 billion into their auto plants here, fueling a big local expansion among their suppliers.
And the decision by Amazon seems like it already has had a major impact. NorthPoint announced this week that it would build two additional specs at Logistics Park, one of 765,927 square feet, and another with 927,155 square feet, surpassing the previous record for a spec project. Both will have 36' clear ceiling heights and that shows real confidence that distributors still need a lot of space in the Kansas City area.
“The demand is definitely there,” Gutierrez says, “and we are still riding that wave.”
KANSAS CITY—As recently reported in GlobeSt.com, this Midwest city has experienced an industrial boom in the past few years. And today, Chris Gutierrez, president of KC SmartPort, a nonprofit economic development organization, tells GlobeSt.com that every sign points to a continued expansion of the industrial sector, especially in product distribution, which has become a regional specialty.
“The Kansas City area over the last five years has seen on average about four million square feet of speculative space built each year,” he says, or 20 million square feet in total. Furthermore, users have absorbed that space almost as fast as developers have put it up. “It's just been an incredible run of supply meeting demand.”
The latest milestone for this burgeoning region was Amazon's recent decision to fully occupy NorthPoint Development's new 822,104 square foot speculative development at Logistics Park Kansas City in the Kansas suburb of Edgerton, the largest spec development ever built in the region. Having the market leader in product distribution take the most ambitious spec project to date “was the great cherry on top of all the successes that we have had over the last three to four years,” says Gutierrez.
The reasons for all this success are not hard to discern. FedEx and UPS have both long considered the city a keystone in their national distribution networks. And the rise of e-commerce has simply made the area even more desirable due to its central location. “If you've got one e-commerce facility in this country, it should be in Kansas City,” says Gutierrez.
Rail companies have also responded by building huge intermodal facilities like BNSF's at Logistics Park Kansas City. Further boosting the region was GM and Ford's decision a few years ago to pour about $2 billion into their auto plants here, fueling a big local expansion among their suppliers.
And the decision by Amazon seems like it already has had a major impact. NorthPoint announced this week that it would build two additional specs at Logistics Park, one of 765,927 square feet, and another with 927,155 square feet, surpassing the previous record for a spec project. Both will have 36' clear ceiling heights and that shows real confidence that distributors still need a lot of space in the Kansas City area.
“The demand is definitely there,” Gutierrez says, “and we are still riding that wave.”
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Brian J. Rogal
Brian J. Rogal is a Chicago-based freelance writer with years of experience as an investigative reporter and editor, most notably at The Chicago Reporter, where he concentrated on housing issues. He also has written extensively on alternative energy and the payments card industry for national trade publications.
