In the retail sector, Bob Johnson of R.H. Johnson and Company affirmed, “Our biggest challenge is our cost.”
Cost is also an issue in the title industry noted Diana Ennis, commercial manager for Stewart Title Loan and member of KC CREW. Her goal is “to be able to keep the costs for title insurance where it is.”
Sites
Olen Monsees of B.A. Karbank & Company was the first to identify site availability as challenge number one “in our industry, not just our company.” As Monsees explained, the sites most in demand are those having enough good ground with utilities, streets and other infrastructure for new building and development.
Estel Hipp with Block & Company agreed that identifying “land that is readily available with infrastructure for development” is an ongoing issue. The search for “readily available, grounded infrastructure,” affirmed Kevin Jones with Jones Development Company, is “our biggest challenge.”
Pat McGannon of Kessinger/Hunter & Co. foresaw a shortfall in quality big-box distribution centers. “It’s hard to convince people to build that with no history,” said McGannon. “We’ve talked to institutions. Everybody is standing on the sidelines.” Still, McGannon believes that the industry will find a way. “I think we’re trying to figure out how to make that happen.”
“What kind of demand are you seeing,” asked Tom Turner, “and are we picking up speed?”
As McGannon explained, the railroads traditionally filled out these sites and parceled them out to users. The railroads, however, can no longer afford to keep these grounds. Now, an area has to rely on the private sector or government. “It is a hard way to make money, to put the infrastructure in the ground,” added McGannon. “It is very difficult.”
“I think so too,” agreed Monsees. He added that, despite the difficulties, ten years from now the two major logistics centers will be the Burlington Northern site in Gardner, Kansas, and the Kansas City Southern site at the old Richards Gebauer.
“This Burlington Northern is a big deal,” affirmed McGannon. He told of being at a national conference and hearing a developer from LA say, “The hottest places we’re looking at now are Houston, Savannah and Kansas City.” Joked McGannon, “I about fell out of my chair!”
Kevin Wilkerson talked about the potential of sites around KCI. His firm hopes to be one of the first to lead with a big box on a speculative basis. “We have a lot of infrastructure that we need to address up at the airport,” he affirmed, “but we are working rapidly to address that.”
Kevin Jones advised his colleagues to keep their eyes on Riverside. “From an industrial standpoint,” he offered, “it’s a great site.” Wilkerson called it “probably the best site in Kansas City.” He believes, however, that it will be passed over because the city of Riverside is not offering the kind of tax abatements that other cities are.
“Most of these municipalities don’t want industrial land,” attested Ken Jaggers. “That used to be the game. But now they want Zona Rosa. They want sales tax dollars.”
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