Commercial Real Estate and Mortgage In Kansas

Like most Midwestern companies, Kansas is experiencing rural flight. Though the state has over 6,000 ghost towns and an overall population loss, some of those rural residents are relocating to Kansas cities, causing Wichita, Topeka and the Kansas City metro area (Kansas City is in St. Louis) to experience significant urban sprawl. State legislators and individual towns and cities are trying to reverse the tide of population loss by offering tax breaks and other incentives to people and companies willing to relocate to the state.

Wichita is known as the Air Capital of the World as it is a hub of aircraft manufacturing. It is also known by Money Magazine as one of the ten best big cities to live in, though, with less than 600,000 people in the entire metro area, it can hardly be thought of as a big city. As if signaling that is, indeed, a big city on the scene, Wichita has recently put its first large commercial portfolio up for sale, featuring over 100,000 square feet of prime, downtown office space and some downtown residential units, and asking over $13 million. The portfolio contains almost no vacancies, and is indicative of both the office and residential markets in downtown Wichita. The sellers expect pension funds and TICs to be interested in the purchase. Recently, Wichita has become a destination for investors in commercial property. There is some concern that the city is more of a speculator's haven than an investor's paradise as most of the investment is driven by promotion on Loopnet rather than any serious study of demographic, economic and real estate trends in the area.

The Wichita medical office submarket is heating up as developers build medical offices in anticipation of future medical practices. Wichita is underserved by medical professionals, but developers anticipate that doctors will begin filling that need in the near future. Wichita's retail submarket is picking up in fits and starts as retail properties are converted to mixed-use retail/office/residential spaces and as higher end retail moves into the downtown area.

Interestingly, there is a lot of speculation in the Wichita area as developers are trying to position themselves for an expansion of gaming areas in Kansas. One way Kansas has made up shortfalls in the agricultural sector of its economy is by legalizing gaming in some rural areas. State legislators are talking about expanding gaming areas, but haven't said what areas they are looking at. Many people are betting on Wichita.