Kansas City Industrial Market – 4Q25
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.
- Average Asking Rent: $6.08/SF
- Vacancy Rate: 5.0%
- Net Absorption: 218,829 SF
Kansas City Office Market – 4Q25
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.
- Average Asking Rent: $23.10/SF
- Vacancy Rate: 15.9%
- Net Absorption: 114,978 SF
Kansas City Retail Market – 3Q25
Kansas City continues to outperform regional and national retail benchmarks as leasing activity exceeded new deliveries by more than eight-to-one during the past year. Occupancy levels of 95.9% combined with a 1.8% year-over-year rent increase reflect solid tenant demand and limited new supply. Retail investment volume for all-sized deals topped $773 million over the past 12 months, a 26.6% increase year-over-year, with sustained activity in core infill areas and community shopping centers. Leasing velocity remains robust across both national brands and local operators, with many tenants locking in terms of further tariff-induced price increases.
- Average Asking Rent: $15.07/SF
- Vacancy Rate: 4.1%
- Net Absorption: 23,948 SF
Kansas City Capital Markets – 4Q25
The pace of investment activity in the Kansas City market increased during 2025, with sales volume totaling $3.7 billion. As a leading second-tier market, the Kansas City Metropolitan area ranked sixth out of the largest 13 Midwest markets in total sales volume during the past 12 months, with multifamily and industrial assets combining 65.7% of the Metro’s activity.
- 12-Month Capitalization Rates: 6.3%
- 12-Month Total Sales Volume: $3.7 Billion
State of Space Report – Kansas City Office Market
The State of Space Report is a snapshot of the current Kansas City office market and provides detailed information that is useful for both owners and occupiers of office space throughout the Kansas City metropolitan area.
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Big Box Report – Kansas City Industrial Market
The Big Box Report is a summary of all existing, under construction and announced Class-A vacancy in the Kansas City Metropolitan market. Inquire with the Industrial & Logistics Heartland Team to receive the report.
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