Reis reports second quarter 2012 vacancy in Kansas City’s community-neighborhood shopping center market at 12.2%, down 30 basis points from the prior quarter and down 90 basis points over 12 months. The July rate was unchanged, according to Reis. Power center vacancy was 5.2% in the second quarter, down 90 basis points from one year earlier There have been no retail property completions in Reis submarkets since June 2011. A 495,000-square-foot power center in Jackson County completed in September 2012. Power center asking rents were $21.56 psf in the quarter, up 0.6% over the year. Community-neighborhood construction totaled nearly 3 million square feet from 2002 to 2011, although annual totals were lighter towards the end of that time span. Net absorption, however, totaled 1 million in that time span, allowing vacancy to reach the double-digit range in 2008 and remain there. Net absoprtion picked up in the second quarter, at 75,000 square feet. Vacancy is in fact forecast to stay in the 11.0%-to-12.0% range throughout the Reis forecast period.
Rent growth was barely positive in 2011, with gains of 0.1% and 0.3%, asking and effective. For the second quarter of 2012, Reis reports average asking and effective rents of $14.10 psf and $12.02 psf, up 0.1% and 0.2% for the quarter. These measures are up 0.4% and 0.5% over 12 months. From 2002 to 2011, asking rents rose an average of 0.7% per year, so retail rents do not perform well. Both rental measures were unchanged in July. Looking forward, Reis forcasts only slight increases for 2012 and 2013. Gains only in the range of 2.0% are forecast thereafter.
Colliers reports a June 2012 vacancy rate of 14.0% for all retail space in metro Kansas City, down 50 basis points from one year earlier. The quoted rent is given as $11.79 psf, down 2.2%. “The largest lease signings in 2012” according to Cushman & Wakefield “include: Furniture Deals’ lease of 60,192 square feet at Hawthorne 40 Shopping Center; the 40,000-square-foot Ross Dress for Less lease at Independence Commons, and the 28,600-square-foot lease signed by Natural Grocers at Regency Park Shopping Center.”