5 lessons from survey about future of KC development

By Brett Posten, as published in The Kansas City Business Journal on September 18th, 2020.

Real estate development is a creative business, typically advanced by developers who can look at “what is” and imagine “what if.” This is how empty lots and dilapidated buildings become vibrant parks and hubs of commerce. And here in KC, these city-builders have been on a pretty good roll. 

… cue the record-scratch sound effect …

Today, more than six months into the New Pandemic Order, we know about “wet markets,” have learned about spiky viral proteins and have started to face the realities of insidious racism.

As a firm that helps developers position transformational projects and guides cities in redefining their identities, it’s been critical for us to have some view into the future. Our curiosity has sent us looking for answers.

Over the past 90 days, we have interviewed and surveyed more than 50 Kansas City leaders in business, real estate, law, restaurants and civic organizations to understand what they believe about KC’s future. 

Here’s what we’ve learned:

1. A confluence of factors has put the KC growth trajectory at risk.

While all agree that Covid is going to have an extremely negative short- to medium-term impact on retail, office and more, the added pressure of a proposed new city ordinance that would require developers to get permission from school districts in certain KCMO development areas could be a double whammy that keeps developers on the sidelines for the foreseeable future. Developers take risks to generate growth, and too many uncertainties make them nervous. In KCMO, we need to approach this important debate with our eyes wide open. 

2. Fewer workers + workplace distancing ≠ unchanged footprint.

Similar to a high school algebra problem: If more workers stay home, but new office leases include a larger footprint to “spread out” remaining offices workers, will these two factors cancel each other out? Our survey results show 45% think it’s “probably true” that because of social distancing, employees need more space to spread out, and 35% “absolutely agree” that they’ll need more space to spread out. The results also show that 50% believe the net effect will NOT be neutral when you combine some employees working from home and people needing more space. Overall, more space will be needed as a result of Covid. 

3. Radical redesign isn’t in store for KC. 

Unfortunately, for the more progressive architecture firms that have really great ideas for the redesigned office space of the future, it’s unlikely KC developers are going to push the envelope and take risks. Only 5% of respondents agreed with the phrase “Due to Covid, the entire design of the workplace needs to be completely redesigned.” KC has typically lagged the coasts when it comes to cutting-edge design, and even this virus hasn’t created a sea change of local design thinking.

4. A “wait and see” attitude pervades; however, is the glass half full or empty?

Our interviews and survey are focused on the Kansas City area, so we don’t know if there’s a “wait and see” approach nationwide. However, 65% of respondents agreed with “We are considering changes, but we’re also waiting to see how this plays out,” and only 15% agreed with “Nothing is changing; full steam ahead.” In a broader context, the stats from KC Rising show that we have been losing ground to our national competitive set. This could mean that while KC developers remain deliberate and cautious, developers in more aggressive cities will gain a six- to 12-month timing advantage.

Simply put, when we add our interview responses to this mix, we believe there’s a bit of small-town, self-focus that could end up dragging KC lower in a variety of growth rankings. As other cities continue to gain population, build new business destinations and attract national tenants, we seem to be less concerned about being left behind.

Finally, there’s something else we’re seeing:

5. Hard lessons will not produce lasting change without hard work.

As branding people, we read research the same way we understand music. There are answers on the page — the notes — but there’s also the tone of the responses — the way the music sounds. Throughout our interviews and gauging the tone of leading organizations, we hear something else at play: Nothing will be the same after 2020. And not just because of Covid.

Professional firms across the real estate spectrum are now working to diversify their ranks, seeking more input from minority communities and building a more inclusive future.

And for this, we believe that there are so many reasons to be optimistic for KC. We have huge opportunities on the East Side, we have an attractive Midwestern character, our work ethic is unchanged, and we have Black and white leaders cooperating on the hardest of issues.

Perhaps when we have 2020 in our hindsight, we will see that the real change we needed as a society wasn’t about social distancing, but racial unity. It wasn’t about masks, but rather about vulnerability. It wasn’t about transformational real estate as much as it was about transforming our society. Let’s do this. Let’s go, together.

Interested in our occasional opinion on real estate, design and placemaking?

HIGHLINE PARTNERS
2100 CENTRAL
HIGHLINE SUITE 01D
KANSAS CITY, MO 64108
  • LinkedIn
  • Instagram