Ken Block, managing principal of Block Real Estate Services LLC, will be keeping a close eye on another commercial real estate mogul, incoming President Donald Trump, next year while, closer to home, monitoring the anti-development efforts of John Q. Public.
The economy has been strong but "kind of anemic" because of weak job growth, said Block, whose company is coming off one of its busiest local development and brokerage years.
"But we now have a new administration coming in, and all signs point to an increased emphasis on job creation and business deregulation," he said. "It looks like it will be a good year for the national economy, and that will basically be the same for Kansas City."
The wild card Block will watch locally: the many watchdogs and NIMBYs — short for Not In My Backyard — who have been gaining power.
Buoyed by their ability to sway new Kansas City Council members and an initiative petition process that lets them block incentives with just 1,700 signatures, community activists killed BNIM's Crossroads Arts District headquarters project in 2016. They also blocked variances for two Country Club Plaza projects valued at $68 million — including a 188-apartment project proposed by Block Real Estate Services. And they forced passage of a new incentive-reform ordinance that caps property tax abatements and diversions at 75 percent.
Now, Block added, the Coalition for Kansas City Economic Development Reform is considering submission of a petition that could force a public vote on a 50 percent incentives cap.
"All that does is push development projects to other cities," he said. "When you have out-of-state developers comparing development in Kansas City versus Dallas, Chicago or wherever, they look at what the climate is. And when the climate goes negative, they will disappear. The in-state guys will also disappear (from Kansas City) because there are a number of cities in the metro and out of town with open arms right now."
Looking at the entire region, commercial real estate and development are hitting on all cylinders, Block said. Multifamily leads the way, delivering more than 3,000 units in 2016 and projected to add nearly as many in 2017. Also hot is the industrial market, which has been buoyed by e-commerce, auto manufacturing and the region's intermodal freight infrastructure.
Source: Kansas City Business Journal