Kansas City Office Market
The market recorded 114,978 SF of net absorption during the quarter, bringing the 2025 total to 924,086 SF. This marks the sixth 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 116,660 SF currently under construction. Vacancy decreased 10 basis points to 15.9% in the quarter and 90 basis points year-over-year. The trend is expected to continue in 2026 towards 15.0% as the market stabilizes and Class A product continues to experience strong leasing momentum. Average asking rental rates declined to $23.10/SF in the quarter but are expected to grow 2.5% to 3.25% by year-end 2026.
Kansas City Industrial Market
The market recorded 218,829 SF of net absorption in fourth-quarter 2025, bringing the annual total to 8.4 million SF. While many markets across the U.S. experienced negative absorption in 2Q and 3Q, KC posted positive absorption, demonstrating its importance as a centralized intermodal hub. Robust leasing activity was ongoing throughout 2025 with tailwinds also projected for 2026. Consistent demand and a limited spec pipeline drove vacancy down 40 bps year over year to 5.0%. Kansas City ranked fourth in lowest aggregate vacancy rate in 4Q25 among the top 30 U.S. industrial markets. Of the 6.4 million SF construction pipeline, more than 4.8 million SF (75%) is currently dedicated to build-to-suit projects including Panasonic’s 2.35 million SF, Precision Vehicle Holdings’ 850,510 SF and Amazon’s 630,000-SF distribution center.