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Wichita's Downtown Revitalization Serves as Catalyst For New Project

Tuesday, July 14 2020 7:33 PM

Wichita has been experiencing a strong downtown revitalization that has brought construction of new and redeveloped office, retail and mixed-­use projects throughout its urban core over the past few years. Two years ago, companies began relocating downtown as shifting workplace de­mographics incorporated close prox­imity, "live, work, play" amenities in order to grow their businesses a well as attract and retain talent.

Today's businesses are seeking modern Class A finishes within Wich­ita's center where these types of en­vironments exist or will be available in the near future as developments continue.

Downtown revitalization

In the early 2000s, downtown Wich­ita lost many of its office users to more suburban office developments on the east and west edges of the city, leav­ing high vacancy rates and render­ing many downtown office buildings functionally obsolete. ow this trend has reversed after the Wichita Down­town Development Corp. put togeth­er a comprehensive master plan to re­vitalize the urban core.

Developers purchased key cata­lytic sites and repurposed them into economic drivers for downtown as shifting demographics brought about the need for businesses to attract and retain top talent with both onsite and walkable amenities.

As new office projects downtown are beginning construction and be­ing completed, the idea of relocating to Wichita's central business district (CBD) has become more appealing to companies such as Cargill Protein, Meritrust Credit Un ion, Martin Pring­le Law Firm, Alloy Architecture, Hut­ton Construction and IMA Financial Group, to name a few.

Over the next few years, downtown Wichita can expect to see the comple­tion of over a dozen larger develop­ments bringing approximately 730,000 square feet of new office space. in addition, new mixed-use projects like the proposed Riverfront Legacy mas­ter plan will activate new downtown amenities along the Arkansas River. Since 2018, Wichita's downtown office occupancy growth has outpaced the city's overall occupancy growth of 3.3 percent with a full 4 percent increase bringing the number of occupied CBD office space to 1.7 million square feet.

After Wichita's 20.9 occupancy num­bers were released, it is clear that there is now more of a demand for office space than in previous years, as downtown office space occupancy grew to 87.6 percent with market rates in the $1. 8.44 per square foot range.

Although Wichita's downtown of­fice occupancy is growing, it is mainly due to the relocation and growth of current companies within the city as opposed to new businesses entering the market. However, as the need for newer Class A office space is on the rise, developers have been able to meet the demand by either redevelop­ing older buildings or building com­pletely new offices. One major project that has recently helped shape down­town is Cargill Protein's newly built, 200,000-square-foot headquarters. Fi­delity Bank has also begun construc­tion on its 152,000-square-foot build­ing with 17,000 square feet of retail space on the main floor.

In addition to these new construc­tion projects, developers are actively working to repurpose and reposition some of downtown's older buildings into new and useable office space. For example, the redevelopment of an old fire station has given the building new life as a 15,000-square-foot cowork­ing office space. Another example of a Wichita developer reutilizing an outmoded building is the Ice House at Union Station. Originally built in 1901, the Ice House is currently being redeveloped into a 38,000-square-foot Class A office building where tenants will be able to enjoy modern finishes with outdoor patio amenities.

In addition to these projects, an­other 27,000-square-foot building was recently purchased and will undergo renovation to transform an old an­tique mall into a Class A office build­ing. The largest challenge now is the lease-up time to occupy these new office projects with tenants who will then be able to support new employ­ment.

What's driving growth

Since 2010, Wichita's downtown population has been steadily grow­ing and driving the demand for new housing in the area. Over the past 10 years, approximately 1,228 residential units have been completed with more than half of these being built since 2016 and an additional 2,000 or more units being planned over the next five years. In addition to the urban growth, living in downtown Wichita has become more and more appealing over the past few years with the intro­duction of a new minor league base­ball team, The Wichita Wind Surge, and the construction of its new $75 million stadium along the west bank of the Arkansas River, which has re­cently been announced as Riverfront Stadium.

Although Wichita's new baseball team has been a huge talking point among those investing in the down­town area, the main topic of discus­sion has been what the city is calling the Riverfront Legacy master plan, a 55-acre mixed-use development fea­turing retail, office and residential components with the city's conven­tion center, Century Il, as the focal point. ln total, the entire project is ex­pected to cost $1 billion, which will be financed through public and private investment capital.

The third aspect of Wichita's down­town lifestyle is where residents are spending their dollars in the city's CBD. With an estimated population of 2,750 residents within a 2.5-square­mile area and $163 million spent with in the area, it is clear why many of these developers are opting for the mixed-use concept when building their projects downtown. One major mixed-use development is Occidental Management redevelopment of the historic Union Station campus fea­turing 140,500 square feet with a mix of Class A office, restaurant and retail space.

Just west of the Union Station de­velopment is another newly opened

units being planned over the next five years. In addition to the urban growth, living in downtown Wichita has become more and more appealing over the past few years with the intro­duction of a new minor league base­ball team, The Wichita Wind Surge, and the construction of its new $75 million stadium along the west bank of the Arkansas River, which has re­cently been announced as Riverfront Stadium.

Although Wichita's new baseball team has been a huge talking point among those investing in the down­town area, the main topic of discus­sion has been what the city is calling the Riverfront Legacy master plan, a 55-acre mixed-use development fea­turing retail, office and residential components with the city's conven­tion center, Century Il, as the focal point. ln total, the entire project is ex­pected to cost $1 billion, which will be financed through public and private investment capital.

The third aspect of Wichita's down­town lifestyle is where residents are spending their dollars in the city's CBD. With an estimated population of 2,750 residents within a 2.5-square­mile area and $163 million spent with in the area, it is clear why many of these developers are opting for the mixed-use concept when building their projects downtown. One major mixed-use development is Occidental Management Inc.'s redevelopment of the historic Union Station campus fea­turing 140,500 square feet with a mix of Class A office, restaurant and retail space.

Among these projects is Hutton Construction's $5 million investment to build its new 24,000-square-foot headquarters. ln addition to Hutton's new head office, EPC Group plans to develop a new $40 million mixed-use project featuring apartments, a hotel and a public greenspace for residents and other Wichitans to enjoy. Other projects bringing an improved live play atmosphere to the area are the new River Vista Apartments, Wichi­ta's new Advanced Learning Library and the announcement of a ballpark village to be built just north of the new Riverfront Baseball Stadium.

With approximately $655 million in­vested into the downtown area since 2010, and an estimated $1 billion+ in the next 10 years, developers are ac­tively working to expand the city's ur­ban core into a market where existing companies can grow their businesses as well as help the city attract new companies to the Wichita area.

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