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Retail, Industrial Brokers in Wichita Market Remain Busy

A California-based private equity group recently purchased this 15,120-square-foot retail property occupied by Walgreens in Wichita for $4.4 million.

Wichita experienced considerable retail and restaurant expansion throughout 2021, with other new stores planned for 2022. The two biggest new players to Wichita include Top Golf at 29th Street and Greenwich Road, now under construction, and Scheel’s entering the market with a new 220,000-square-foot store to be located in the former Sears space at Towne East Square. Top Golf is anticipated to open in late 2022, spurring more retail activity on North Greenwich. 

Furniture stores have been actively backfilling big boxes, including Bob Mills who took the former Michael’s, and Wichita Furniture, a strong regional player, taking the former 100,000-square-foot Kmart building on West Kellogg/US-54.

Brad Saville, Landmark Commercial

Discount stores have continued to find a way to open more locations to increase their footprints in the market, both new construction and conversion of former retail spaces. Ollie’s Bargain Outlet opened its west store at Central and Ridge roads, and is also opening a store at Brittany Center.   

Quick-service restaurants (QSRs) have been active, including two new locations opening in 2022 for Dunkin’ and several new Dutch Bros Coffee locations as they enter the market as well in late 2022 and 2023. Tropical Smoothie Café opened a location last year and Smoothie King is actively pursuing several new sites.   

On the Mexican front, Fuzzy’s Tacos will open its third Wichita location in an Applebee’s conversion at New Market Square, and Torchy’s Tacos opened two locations in 2021 with the west one having a drive-thru. We are seeing the drive-thru be a key factor in other concepts such as Chipotle; its new stores have a drive-thru pickup window. No announcements yet, but Wichita is expecting to see several Whataburger restaurants open in 2023. Wichita will finally get a Chick-fil-A in the northeast part of the market to help take some pressure off of the other high-volume stores. 

All in all, the Wichita retail and restaurant brokers and developers have been busy. Low cap rates have helped developments to continue moving forward despite huge increases in the cost of construction.  

Robust industrial activity 

The 2021 industrial market in Wichita was robust to say the least, more active than we’ve experienced in several decades. The increased activity first evidenced itself when the Amazon effect hit nationwide in 2017, stimulating all aspects of industrial activity. It has been growing steadily year after year, setting records even through COVID. We finally got our own Amazon warehouses, with the 1.1 million-square-foot building at 69th and North Broadway, and another 140,000-square-foot building near Toben and Webb Road.

Ted Branson, Landmark Commercial

Lou Robelli, who has built over 5 million square feet of warehouses along I-135, sold four of his warehouses totaling 1.3 million square feet to an investor. Robelli is buying more acreage along the I-135 corridor and elsewhere, readying it for more warehouse development. He also sold several parcels to those wanting to build and own.  

Southern Glazers’ warehouse was in the path of the reworking of the north highway hub of I-135, K-96 and K-254, and had to relocate by early 2022. After no workable existing buildings were found, we arranged for Robelli to build a 25,000-square-foot warehouse near 61st and Broadway in eight months to make the deadline. 

In the Comotara Industrial Park, a 100,000-square-foot spec warehouse near 35th and Webb Road was leased to multiple tenants. A 37,500-square-foot warehouse was built for Elliott Electric Supply near West and Esthner. 

We saw many 5,000- to 55,000-square-foot warehouses sell to businesses, or they were sold to investors and then leased quickly to a wide variety of businesses such as Watco. We saw most quality buildings lease or sell leaving the market in short supply, except as turnover brought new opportunities. 

More and more prospects are wanting to own, but that short building supply is causing many to buy land and build new, although they have to face the prospects of high construction costs and completion delays due to supply chain issues. 

Several new industrial parks came on line and buildings were started to accommodate such needs, including the ICT21 industrial park that was a former oil refinery at 21st and I-135. We were also glad to see aerospace coming back strong after the downturns of the past few years. So, the industrial market is proving to be resilient through these challenges.

Brad Saville is founder and CEO of Landmark Commercial Real Estate Inc., while Ted Branson is the industrial division director with the firm. This article originally appeared in the May 2022 issue of Heartland Real Estate Business magazine.

Content Partners
‣ Arbor Realty Trust
‣ Bohler
‣ Lee & Associates
‣ Lument
‣ NAI Global
‣ Northmarq
‣ Walker & Dunlop

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