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2022: KC’s Record-Breaking Year for Industrial Growth

by Mary Rooney | Jan 10, 2023

2022 was a year to remember for the industrial market! Industrial real estate remained the top asset class for development and investment, both at a national level and across Kansas City. 

  • The Kansas City industrial market continued to set new records in 2022, with over 11 million sq. ft. feet absorbed over the last 12 months. Additionally, more than 12.6 million sq. ft. of new industrial space was under construction at the end of 2022, teeing up a strong start to 2023. (source: Cushman & Wakefield)

  • Development of Class A spec space took place in nearly every industrial submarket in the KC region, which increased the KC region’s ability to compete by offering clients diversity of product from both a size and location perspective.

  • In April of 2022, KC SmartPort highlighted sixteen spec buildings in our market that were more than 500,000 sq. ft., including four that were 1 million sq. ft. or more. A majority of those buildings were leased or sold in 2022.  

The demand for industrial space continued in 2022 as the need for just-in-case inventory grew with ongoing global supply chain challenges. 

  • The most prominent growth sectors for KC were 3PL warehousing operations, retail distribution/ fulfillment and manufacturing operations.

  • Trends around near-shoring or ally-shoring increased and the challenges with the global supply chain pushed companies to make decisions to locate facilities closer to the customer base.

The Kansas City region attracted corporate powerhouses.  

  • The attraction of the $4 billion Panasonic Energy EV battery manufacturing facility to De Soto, Kansas, highlighted an active and substantial year for manufacturing growth in KC.  

  • Additional recruitment successes included Home Depot, Clorox, Boot Barn and RLE International.  In partnership with the Animal Health Corridor, Simmons Pet Food also located a major distribution center in the region.

  • The majority of deals in the KC SmartPort project pipeline were for manufacturing operations. This increase in manufacturing pushed the KC region to respond to the higher demand for utilities and rail-served sites. 

In 2023, the Kansas City industrial market will continue this record pace.

  • Several new spec developments are already announced to begin in 2023. 

  • The pipeline of KC SmartPort deals suggests 2023 will be a prosperous year for eCommerce, distribution, manufacturing and foreign direct investment success.

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