Like most Midwest cities, Kansas City faces its share of challenges. However, there is still much optimism about the future of the Kansas City CRE market. The industrial sector here was strong before the pandemic hit and has only seen more activity during COVID. Real Estate experts Aaron Mesmer and Daniel Brocato from Block Real Estate Services report their recent CRE insights:
The multifamily sector has remained solid, with investors eager to sink their dollars in apartment developments across the Kansas City region. And people have returned to downtown Kansas City, shopping, eating at restaurants and visiting the area’s tourist attractions.
Due to the continuation of rising single-family homes, the multifamily sector remained solid throughout the pandemic and is showing no signs of slowing. The downtown apartment market experienced some softness in the middle of last year, but the urban multifamily market has since regained its momentum. Multifamily activity never slowed in the suburbs.
The pandemic forced retailers to adapt. Those that were creative have largely survived retailers in the Kansas City region are enjoying a stronger year. The reason? Creativity. The retailers that adapted quickly and offered pick-up and curbside services did really well. Pick-up and delivery services were also successful and restaurateurs are now looking for more locations in the area.
This doesn’t mean that challenges don’t remain. Many retailers are now dealing with a labor shortage as they struggle to find the cashiers, servers and other employees to keep their businesses running. Many workers are remaining home, collecting unemployment instead of returning to their jobs. And that is putting plenty of stress on retailers.
Before the pandemic, experiential real estate was thriving. People flocked to high-tech bowling alleys and arcades, sprawling golf centers and eat-in movie theaters. The pandemic, of course, brought this to a halt. But what about today? As vaccinations rise, are more people returning to experiential retail? As people have continued to get vaccinated, the level of comfort has risen quite a bit. Certain people might not feel that way, but many vaccinated people are saying that they are ready to do what they did before COVID.
Another key positive sign? More people are returning to downtown Kansas City. The offices might not yet be full, but people have returned to the area’s shops, bars and restaurants. And offices in downtown and the suburbs? Employees are slowly starting to return. Many companies are offering a hybrid model, where employees work remotely one or two days a week. More people are using public transit again. Restaurants are filling up. The Power & Light District in downtown Kansas City is coming back to life. Slowly but surely, the Kansas City CRE market is returning back to where it was prior to the pandemic!