Tenant Demand Builds for Office Properties in Kansas City

KANSAS CITY, MO — The Kansas City office market will continue to improve throughout 2008, led by ongoing tenant interest in the suburban markets and building momentum downtown, according to the 2008 National Office Report by Marcus & Millichap, the nation’s largest real estate investment services firm. (Downtown Kansas City photo top left)

The local economy is expected to post another year of steady job growth, with in-migration spurred by the metro’s developing transportation infrastructure.

Also included in the report is the firm’s annual National Office Index (NOI), a snapshot analysis that ranks 43 office markets based on a series of 12-month forward-looking supply and demand indicators. Kansas City moves up two places this year to No. 33.

“Investors are expected to maintain a positive long-term investment outlook for the Kansas City

office market,” says Gary R. Lucas, (photo at right) regional manager of Marcus & Millichap’s Kansas City office. “Limited competition will give way to tightening occupancies and modest rent growth, providing for traditional asset appreciation through increases to operating incomes.”

Following are some of the most significant aspects of the Kansas City Office Research Report:

· · Employers will add 11,000 positions for a 1.1 percent increase.
· · Developers will deliver approximately 550,000 square feet of space to the market this year.
· · Vacancy is expected to fall 80 basis points to 14.3 percent.
· · Asking rents will increase 2.2 percent to $18.80 per square foot, while effective rents advance 2.7 percent to $15.60 per square foot.
· · The downtown submarket has struggled in recent years, providing buyers the opportunity to acquire underperforming assets within an area positioned for improvement.

In the 2008 NOI, Seattle moved up three places to secure the No. 1 spot, surpassing last year’s leader New York City, which slipped to No. 2. Boston moved up two spots to No. 3, while San Francisco jumped 12 places to the No. 4 position. Los Angeles slipped two spots, coming in at No. 5. (Country Club Plaza, Kansas City, photo at left)

For a copy of Marcus & Millichap’s National Office Report and the complete NOI rankings, visit www.MarcusMillichap.com.

Contact:
Stacey Corso
Public Relations Manager
Marcus & Millichap
2999 Oak Road
Suite 210
Walnut Creek, CA 94597
Office: 925.953.1716
Mobile: 415.672.6460
Fax: 925.953.1710
http://www.marcusmillichap.com/