Skip to main content Skip to footer

1st Quarter 2022 Office Trends | Kansas City

Download Report
Office_Q122_hero image

Companies have began to re-enter workplaces and continue to pivot away from a fully-remote environment.

Firms seeking quality space will help bring employees back to the office as well as attract talent by providing space in quality buildings with enhanced amenities. 2022 will continue to bring clarity on space use as COVID-19-related challenges continue to lessen.

Key Takeaways

• Kansas City metro vacancy is up 20-basis-points relative to last quarter
• Office occupiers will continue to embrace hybrid working to some extent
• Pressure on rents could increase in the coming months as landlords compete to capture tenants in the market

Kansas City Highlights

Following close to two years of pandemic-driven correction, signs of stabilization are emerging throughout the office market. Market fundamentals related to the office sector continue to remain soft, but indicators are beginning to trend in a positive direction. Currently the vacancy rate in the Kansas City metro stands at 10.4%, a 20-basis-point increase relative to last quarter and a 90-basis-point increase from this time one year ago. Sublease space remains a key contributor to the increase in vacancy. Throughout Q1 2022 the Kansas City metro experienced 203,387 SF of negative absorption as additional sublease space continues to be added to the market.

Overall asking rents within the Kansas City metro continue to remain relatively steady at $20.49/SF across all product classes. Due to the prolonged length of limited leasing activity, the gap between asking and effective rents continues to widen due to soft market fundamentals. However, as more active requirements emerge, pressure on rents could increase in the coming months as landlords compete to capture tenants in the market.

Workplace and the Return to the Office

Businesses continue to reassess their space requirements, including work models and space use. Many office occupiers will continue to embrace hybrid working to some extent but will vary greatly between each company and business sector. We anticipate that the remainder of 2022 will bring additional clarity on approach and space use as COVID-19-related challenges continue to lessen.

Kastle’s Back to Work Barometer report, which tracks office occupancy through key card activations, has recently reported the highest office occupancy levels since pre-COVID-19, an encouraging sign for office users and the return to their workplaces.

A flight to quality office space will continue for office occupiers as more Class A space options become available at competitive rental rates. Firms seeking quality space will help bring employees back to the office as well as attract talent by providing space in quality buildings with enhanced amenities. Lease commitments remain tepid at this point as many firms evaluate their real estate strategy, but leasing activity is continuing to gain traction.

Moves and Growth Around the Metro

A handful of sizeable deals were signed throughout the first quarter, which continue to signal growing confidence from decision makers about their real estate needs going forward. Touring activity continues to increase as some companies re-enter workplaces and continue to pivot away from a fully-remote environment.

Wellsky continues to grow in South Johnson County as they announced plans to occupy an additional 132,000 SF within a new building in the CityPlace development. As a result, construction for CityPlace Centre IV is expected to commence soon on the $51 million, six-story 190,000 SF office building.

Activity within the downtown submarkets continue to improve as a handful of leases were signed throughout the first quarter. Academy Bank will lease 55,000 SF at 1201 Walnut, while ProMax will sublease nearly 26,000 SF at 2555 Grand. Additionally, Northwestern Mutual leased 14,000 SF at 2345 Grand. The highly-anticipated 1400KC building is expected to be delivered in Q2 2022. The 260,000 SF tower originally planned for Waddell & Reed will be the first major office development in downtown since 2009. The available sublet space offers a first-generation Class A office opportunity within the downtown market, which will attract new office occupiers seeking modern office space to the area.

Momentum related to office transactional activity continues to gain traction at local and national levels, but remains limited relative to other commercial property sectors. Nazareth Enterprises acquired 9201 State Line from Real Capital Solutions for $27.6 million. The nearly 156,000 SF building is fully leased to Burns & McDonnell. In downtown Kansas City, Jackson County purchased 1300 Washington for $9 million. Jackson County purchased the 82,664 SF building for use as administrative offices.


Office_Q122_search image

1st Quarter 2022 Office Trends | Kansas City

Download Report
Related Experts

Martin Maguire

Senior Director Research

Kansas City

Martin joined Colliers in 2012 and is the Senior Research Director of the Kansas City office. Martin is responsible for the aggregation, analysis, interpretation, and reporting of market research, including all quarterly and annual market reports for the Kansas City and Lawrence markets. Martin works with all transaction service professionals in serving clients by providing an elevated set of research skills and project management through data aggregation, creation and maintenance of database content and GIS mapping. Martin has also assisted in the completion of commercial real estate transactions exceeding $37 million and 300,000 square feet of accumulated deal size, including retail and land properties. Martin’s expertise includes financial analysis, property valuation, due diligence review and market evaluations.

Prior to joining Colliers Kansas City, Martin spent two years within the asset management division of Cohen Financial in Kansas City, and five years in the Washington DC metro area employed by Capital One N.A. as a disposition analyst and CoStar Group Inc. as a research associate.

View expert

Pat Coppinger

Senior Vice President

Kansas City

Patrick Coppinger became affiliated with the firm in 1998.  Prior to this he began his career in 1994 with the LaSala-Sonnenberg Commercial Realty Company where he specialized in office and retail leasing and sales. Pat now specializes in office brokerage and has been involved in over 600 lease and sale transactions, totaling over 8 million SF of space. Pat has a sub-specialty in Medical Office where he transacted over 1.8 million SF of deals representing both Landlords and Tenants. Pat also works with Buyers and Sellers, has done special site selection projects, and has also been involved in several land assemblage assignments for various redevelopment efforts. 

 

View expert

Phil James

Senior Vice President

Kansas City

Phil James joined the firm in January of 2006 after 17½ years at Kessinger/Hunter & Co. Phil has specialized in both tenant and landlord representation for office leasing and sales.

Phil has averaged $20 million in annual sales and leasing volume over the past 30 years. Phil has represented various institutional organizations such as Lincoln National Life Insurance Company, PaineWebber, The Apollo Group, Teachers Insurance and Annuity, DST Realty, Property Capital Trust, Glenborough Realty Trust, Highwoods Real Estate Investment Trust, Time Equities, American Century Realty, OPUSNW, VanTrust and Nightingale Properties.

View expert

RC Jensen

Vice President

Kansas City

RC Jensen joined Colliers in March 2020 as Vice President on the Office Services Team. RC has been in commercial real estate since 2010 and has been involved in a wide variety of transactions over his tenure. He is a creative problem solver and is always willing to go above and beyond on behalf of his clients. 


RC specializes in office brokerage services including  listings for sale and/or lease, tenant representation, buyer representation, site selection and investment transactions throughout the Kansas City Metro.

Prior to joining Colliers, RC spent 10 years at Reece Commercial Real Estate where he was involved in a significant number of transactions and was consistently one of the top producers in the office.

View expert

Bryan Johnson

Executive Vice President

Kansas City

Bryan Johnson is the former CEO and current Principal of Colliers | Kansas City and has represented office tenants in Kansas City and nationally for the last 43 years. Bryan joined the firm that is now Colliers in 1984, specializing in advising and representing companies with office space needs. 

View expert

Reagan O'Toole

Senior Associate

Kansas City

Reagan joined Colliers in 2016 as part of the office services division. He specializes in advising companies with real estate leasing and ownership solutions throughout Kansas City and the United States. 

During his time at Colliers, Reagan has worked to develop new business and create real estate strategies to help his clients cut costs and increase revenues. His primary responsibilities incude business development, lease structure and negotiation and market and financial analysis. He strives to advance the company's tenant and owner representation team both locally and nationally. 

View expert

Matt Stover

Senior Vice President

Kansas City

Matt Stover joined the firm February 2001 as an Office Leasing Specialist focusing on the sale and leasing of office buildings, as well as tenant representation.


Prior to joining the firm, Matt was a financial analyst for IBM Global Services located in St. Louis, Missouri.  At IBM, Matt was responsible for management of capital expenditures for corporate clients, primarily serving the Boeing International account.  Matt now specializes in landlord and tenant representation in the office market.  Matt has gained extensive experience in representing both tenants and landlords.

View expert

Evan Warwick

Senior Vice President

Kansas City

Evan Warwick joined the firm in January 2001, specializing in the sale and leasing of office buildings, as well as tenant representation.  Prior to joining, Evan was one of the top salesmen for Cintas Corporation in the North Central group where he was instrumental in increasing sales volume.

Evan’s primary responsibilities include new business development, lease structure and negotiation, market analysis and financial analysis. Since joining the firm, Evan has represented a wide range of office tenants including law firms, technology companies, advertising firms and service companies in the Kansas City area.

View expert

Jeff Winters

Senior Vice President

Kansas City

Jeff joined Colliers in 2021 as a Principal and Senior Vice President, specializing in sales and leasing in the office sector with an emphasis in tenant representation. He brings valuable insight in strategic planning, assessment of needs and occupancy relocation to his clients and Colliers. With over a decade of experience, Jeff continues to grow as a real estate professional and focus his efforts on representing clients in the Kansas City metropolitan area.

View expert