The commercial real estate industry took a huge economic hit in Wichita in 2009 as deals dried up in a commercial credit crunch.
The year ended with few or no commissions for even the city’s biggest brokers as the market froze, paralyzed by the lack of available loan capital.
“Commercial credit was available in 2009 and will continue to be for projects that cash flow and have sufficient equity,” said Brad Saville, president of Wichita’s Landmark Commercial Real Estate.
Saville’s company did deals during the downturn, most notably a new 8,960-squarefoot retail center in front of Lowe’s on North Maize Road anchored by Long John Silver’s, Five Guys Burgers and Cinnamon’s Deli.
Opportunities in 2010
Downtown revitalization will move ahead dramatically in 2010, and city officials believe that local entrepreneurs will be the first to begin snapping up available commercial space downtown.
Some national tenants are continuing expansion plans in the economic downturn, Saville said.
Downtown developers are targeting well-capitalized local businesses as they search for the first new retailing near Intrust Bank Arena, which opens Jan. 9.
In addition, properties in default and foreclosure will be good opportunities for investors sitting on the sidelines, Saville said.
Challenges in 2010
Without a thaw in the commercial credit markets, projects will be reduced in 2010 to those funded by significant cash down payments, as much as 40 percent of property value.
Next year will be a slow one for commercial real estate, with projects likely limited to well-capitalized investors able to put significant money into new projects. Speculative deals will be few and far between.
— Bill Wilson