Q1 2023 MARKET OVERVIEW
Wichita Submarkets
Q1 2023 MARKET
OVERVIEW
OVERALL MARKET
Q1 2023 HIGHLIGHTS The Wichita region was buzzing with the announcement by Integra Technologies that they selected the southeast corner of Rock Road and K-254 in Bel Aire as the site for their 1-million-square-foot, $1.8 Billion project, which will put them in competition for semiconductor work internationally. In addition to this site, Integra is leasing space at 3718 N. Rock for a training center and interim headquarters. The project will be heavily subsidized with the state of Kansas committing $304 million in incentives, with additional federal and local incentives to come. This project is seen as a huge win for the Wichita economy with Integra announcing plans to add 2,000 jobs and the Kansas Department of Commerce estimating that the project could create 3,000 jobs at other companies in the Wichita area.
Q1 2023 MARKET
OVERVIEW
Another headline maker in the first quarter of 2023 was the unveiling of a new plan to redevelop the east bank of the Arkansas River that would save Century II and the former downtown library while expanding the convention center space for less than half the cost of the previous plans. There are still some questions about the $400 million dollar plan including how it will be funded, and how and if a new performing arts center will be part of the plan, but all sides of the issue seem confident that this is a plan that could move forward. We were pleased to announce that NAI Martens added five new shareholders to the ownership group with Ryan Hubbard, Trent Garman, Patrick Ahern, Drew Gannon and Stephen Yowell purchasing ownership shares.
NAI Martens announces the addition of five new new shareholders.
OVERALL MARKET
Q1 2023 NEW CONSTRUCTION PERMIT VALUE
CONSTRUCTION ACTIVITY New construction activity is off to a strong start in 2023 with many high-profile projects underway. While the value of permits issued was down compared to Q4 2022, the number of permits issued was higher (84 permits issued in Q1 2023 vs 78 permits issued in Q4 2022)
Q1 2023 MARKET
OVERVIEW
Notable projects announced and permits issued included: A permit was pulled and renovations are well underway on the 28,000 SF Nordstrom Rack in Bradley Fair. Construction is underway on several restaurants in the Greenwich Place development including Panda Express, Wendy's and Dunn Bros coffee. Work has begun on All State Home Improvements 20,000 SF headquarters at 9436 W. Kellogg. Renovations on the 105,000 SF Wichita Furniture and Mattress at 4200 W. Kellogg are nearing completion. Construction is underway on Wichita's largest speculative industrial warehouse which will total 201,000 SF. Located in the Ironhorse development, the warehouse is expected to be completed in October. Permits were pulled for what will be the final two buildings at the Stoney Pointe Apartment Homes, while construction continues on buildings 8-11. When all is complete, the complex will have 438 units.
Retail
Q4 2022: $18,267,822 Q1 2023: $13,930,534
Office
Q4 2022: $36,918,678 Q1 2023: $28,750,104
Industrial
Q4 2022: $205,542,041 Q1 2023: $42,078,248
NEW CONSTRUCTION PERMIT VOLUME 30
20
10
0 Retail
Office
Industrial
OFFICE
Q1 2023 .
OFFICE FUNDAMENTALS
HIGHLIGHTS
The Wichita office market remained fairly active in the first three months of 2023. Activity is being driven by a flight to quality as tenants are looking to take advantage of current market conditions. We are seeing a rise in class A office lease rates based on new space coming on the market and new vacancies opening up. Ascension Via Christi's departure opened up 100,000 SF of class A space in the Thorne office building at 8200 E. Thorn Drive. Vacancy in the CBD also increased when Faneuil who had embraced the remote work model during Covid decided to sublease its 65,000 square feet in Union Station.
SOLD
Vacancy
Q4 2022: 19.33% Q1 2023: 22.40%
Net Absorption
Q4 2022: 701 Q1 2023: (126,363)
Average Asking Rate
Q4 2022: $13.57 Q1 2023: $13.62
LEASED
SOLD
Q1 2023 MARKET
OVERVIEW
1841 N. Rock Rd. Wichita, KS 67206
100 S. Main Wichita, KS 67202
2040 S. Rock Road Wichita, KS 67207
RETAIL
Q1 2023 .
RETAIL FUNDAMENTALS
HIGHLIGHTS
The Wichita retail market was active in the first 3 months of 2023 with both local and national chains making news. Bradley Fair will add another national brand to its line up with the announcement that Warby Parker will be opening its first Wichita location this summer. In addition, other national brands Harbor Freight, Scooter's Coffee and Tommy's Express Car Wash all announced plans for expansion. In addition to national brands there were several local brands including Blush Bookstore, Joyful Willow Spa, and Bchic Bar & Grill that announced openings and expansion. Not all announcements were good news as Baskin Robbins, Tuesday Morning, and First Mile Cantine announced plans to leave the market.
SOLD
Vacancy
Q4 2022: 13.10% Q1 2023: 13.29%
Net Absorption
Q4 2022: (25,271) Q1 2023: 56,688
Average Asking Rate
Q4 2022: $12.87 Q1 2023: $12.23
SOLD
LEASED
Q1 2023 MARKET
OVERVIEW
11233 E. 13th Street Wichita, KS 67206
6959 E. 21st Street Wichita, KS 67206
930 W. Douglas Ave. Wichita, KS 67203
INDUSTRIAL
Q1 2023 .
INDUSTRIAL FUNDAMENTALS
HIGHLIGHTS
While the Integra Technologies megaproject site was the major story in the first quarter of 2023, industrial remained the most active sector in the market with several other large projects announced or completed. The Kansas Logistics Park in Newton, KS announced the largest private investment in five years with GAF Materials purchasing 230 acres to construct a new manufacturing facility. The ICT21 industrial development added a second major occupant with the signing of a 180,000 SF lease with an undisclosed tenant.
LEASED
Vacancy
Q4 2022: 7.20% Q1 2023: 8.71%
Net Absorption
Q4 2022: (143,096) Q1 2023: (673,437)
Average Asking Rate
Q4 2022: $5.33 Q1 2023: $5.33
SOLD
LEASED
Q1 2023 MARKET
OVERVIEW
2204 N. Mead Wichita, KS 67214
2309 E. Mt. Vernon Wichita, KS 67211
3919 N. Hillcrest Bel Aire, KS 67220
NAI Martens is the largest full-service commercial real estate firm in Kansas. Founded in 1948 and headquartered in Wichita, NAI Martens provides a vast array of commercial real estate services throughout south-central Kansas. President Grant Glasgow, SIOR leads a team of professionals with over 150 years of combined commercial real estate experience.
Q1 2023 MARKET
OVERVIEW
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1330 E. Douglas | Wichita, KS 67214| 316-262-0000 THE INFORMATION CONTAINED HEREIN HAS BEEN OBTAINED FROM SOURCES DEEMED TO BE RELIABLE, BUT NO GUARANTEE OF ITS ACCOURANCY IS MADE BY NAI MARTENS