Kansas City Office Market
The market recorded 116,174 SF of net absorption during the quarter, bringing the four-quarter total to 1.1 million SF. This marks the fourth consecutive quarter of positive absorption, driven by tenants capitalizing on favorable leasing conditions. The non-owner-occupied construction pipeline has remained inactive since the fourth quarter of 2018, with just 108,600 SF currently under construction. Vacancy decreased by 10 basis points to 16.1% and is expected to edge down toward 16.0% as the market continues to stabilize. Asking rental rates are anticipated to soften in the coming quarters, following a modest year-over-year increase of 1.1% to $22.96/SF.
Kansas City Industrial Market
The market recorded 315,126 SF of positive net absorption in second-quarter 2025, following the second-highest quarterly absorption total in the market’s recorded history (7.5 MSF) in 1Q25. Robust leasing activity was ongoing in late second-quarter to early third-quarter with the expectation that this will translate into strong net absorption for 3Q25. Steady demand and a slowing speculative construction pipeline drove vacancy down 40 basis points year over year to 5.1%. Of the 6.9 MSF construction pipeline, more than 6.3 MSF (92%) is currently dedicated to build-to-suit projects including Panasonic’s 4.7 MSF, Amazon’s 630,000 SF and Church & Dwight’s 553,000-SF distribution center.