Real Estate News

9 things happening with Wichita downtown development

Downtown Wichita is growing, according to a new report from the Wichita Downtown Development Corp., a nonprofit organization in charge of revitalizing the area.

The data in the report, called the 2015 State of Downtown, is encouraging, WDDC president Jeff Fluhr said Monday. The report will be given Tuesday to Wichita City Council members.

The council provided $622,810 to WDDC in 2014.

“Our trajectory is going the direction we want and need it to go,” Fluhr said. “The next two to five years are going to be quite dynamic as we see more of these projects happen and even more opportunities come to the marketplace.”

WDDC is a nonprofit that receives private and local government support. It was launched in 2002 to help “cultivate the environment for growth,” Fluhr said.

Here are nine things to know about Wichita’s downtown development:

1. $30 million in investment

the lux
Travis Heying The Wichita Eagle

In 2014, the WDDC estimates that the private sector has invested about $21 million in downtown for various projects and the public sector has invested about $8.6 million toward things like the parking garage at Market and William, which is slated to open later this year.

Since 2010, there has been about $320 million in investments. In the next year, total investments over the past decade will approach $1 billion, Fluhr said.

Some of the larger projects completed last year include The Lux ($20 million), WaterWalk Hotel Apartments ($10 million), Rock Island Lofts, Corner 365, renovations of the Courtyard by Marriott ($1 million) and renovations of the Hyatt Regency ($7.5 million).

Investments in downtown projects are directly related to appraised and assessed property values going up, Fluhr said.

The report, which has data from the city and the county appraiser, shows appraised real property value at $822.8 million in 2014 – up from $386.3 million in 2005.

The assessed real property value was up to $81.9 million in 2014 – an increase from $62.7 million in 2005.

As the market grows stronger, the value goes up when the properties sell, Fluhr said.

Public investments in downtown, through things like parking garages and the city’s facade program, also help the surrounding property values.

2. 263 new residences

waterwalk apartments
Jerry Siebenmark

Last year, 263 new residences opened in downtown Wichita and 550 more units are under construction or being planned this year.

For some seeking the downtown lifestyle, it can be difficult to find an apartment.

“Our occupancy rate is not 100 percent, but close to it,” Fluhr said.

Of the places available to live downtown, 59 percent are one bedrooms, 24 percent are studios, 16 percent are two bedrooms and 1 percent are three or more bedrooms, according to the report.

3. More people moving downtown

downtown living
Dave Williams Correspondent

1,872 people. That’s the estimated population downtown. And nearly 60 percent of them have moved there since 2010.

“That’s major movement into the core in just over five years,” Fluhr said.

The average downtown resident is most likely to be a single, college-educated, white male, according to the report.

“Over half of our population is under 40 in the downtown core. That certainly supports what we’re seeing across the country,” Fluhr said. “As they’re graduating from college or getting into professional careers, they’re gravitating toward the city center.”

4. Vacant office space

vacant building
Brian Corn The Wichita Eagle

There’s more than 3.9 million square feet of office space in the central business district. But a significant portion of that is still vacant.

Fluhr said occupancy rates downtown increased from 78 percent last year to about 80 percent this year.

According to the report, Class A office space — which is considered to have the most and greatest quality of amenities — has an average price per square foot of $16.04 and a vacancy rate of 12.9 percent in 2014.

Lower classes of office space, which are cheaper per square foot and have fewer or lower-quality amenities, have higher vacancy rates.

Nearly a quarter of Class B spaces, which go for $9.96 per square foot, are vacant. Nearly 30 percent of Class C spaces are vacant.

5. Above-average salaries for downtown residents

money
Jupiterimages Getty Images

The average salary for people working downtown is $48,846. That’s slightly higher than the average median household income for Wichita, which was $46,011 from 2009 to 2013, according to the U.S. Census Bureau.

Part of that may be because of the diversity and concentration of jobs in downtown, Fluhr said.

“You certainly have financial institutions, a higher concentration of tech companies, design services and professional services like attorneys,” Fluhr said.

6. 2 million arena attendees

George Strait
Fernando Salazar The Wichita Eagle

It has been five years since Intrust Bank Arena opened. In that time, about 2 million people have attended events there.

The arena, which seats about 15,000, was paid for by a since-ended 1-cent-on-the-dollar sales tax. The arena will host NCAA Tournament men’s basketball games in 2018.

The WDDC report breaks out numbers from country music star George Strait’s sold out concert in April 2014 and found that nearly 70 percent of people who bought tickets lived 100 miles or more away from Wichita.

Between those visitors buying tickets, renting hotels and spending other money here, there was a $1.95 million economic impact to Wichita from that event alone, according to the report.

Visitors for that event also brought in more than $315,000 in state and local taxes.

7. But arena attendance also down

Orpheum

Despite the positive economic impact arena events have, attendance has gone down over the past several years, from 492,532 in 2010 (its opening year) to 298,825 in 2014, according to the report.

Meanwhile, attendance at the Orpheum Theater has increased steadily, from 40,654 in 2010 to 65,200 last year.

Century II numbers have remained relatively steady, with attendance at 448,708 in 2010 and 441,302 in 2014.

8. $122 million in retail sales

restaurant

As more people come downtown, more retailers will come to fulfill those residents’ needs, Fluhr said. In turn, more people will likely be attracted to the idea of downtown living, allowing the area to continue to grow.

There are 139 retailers in the downtown area, according to the report. The number one retail industry is food and drink, with 30 percent of total sales and about 900 employees.

Next comes miscellaneous retailers, with 21 percent of total sales and about 182 employees.

The retail market space is 95 percent occupied, according to the report.

9. 26,000 people work downtown

workers
Mike Hutmacher The Wichita Eagle

The number of people who work downtown has remained consistent over the past several years, Fluhr said.

Until Wichita experiences more growth of primary jobs – jobs that bring in money from outside the local economy instead of just circulating it in this area – that number will likely remain the same, he said.

Wichita leaders have been working on an export plan and the Blueprint for Regional Economic Growth to strategize ways to diversify the local economy beyond aviation.

In the meantime, local leaders will have to answer this question:

“How do we create a culture to have an increase in primary jobs?” Fluhr said.

Reach Kelsey Ryan at 316-269-6752 or kryan@wichitaeagle.com. Follow her on Twitter: @kelsey_ryan.

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