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KANSAS CITY, MO-A partnership between Dallas-based Trammell Crow Co. and the Kansas City Aviation Department has broken ground on the 800-acre KCI Intermodal BusinessCentre here at the southeast corner of the Kansas City International Airport. Though the interest in the first phase of the $200 million development has waned with the credit crisis, Trammell officials say they are committed to the project, which will eventually include 5.2 million sf of industrial and mixed-use in 18 buildings. The company will develop all the structures in the park.

The first phase is made up of $15.2 million in infrastructure for the first 180 acres, on a parcel south of the American Airlines overhaul base and fronting Prairie View Road and Interstate 29 on the east side of the airport. The first of four buildings for phase one will be a 494,000-sf spec distribution facility, with an area next to it for a double building to go up pending demand, says Steven Bradford, managing director of airport distribution centers for Trammell. “If everything goes well, we’ll have the spec building up and ready for occupancy by late fall-December 2009.” The facility will be labeled “Building D,” as the designations are given alphabetically from the northwest to the southeast portion of the site.

He says the company had been talking to two groups who were interested in build-to-suits in the park, but then the economy went south. “There had been exceptional interst in the park, it’s been very frustrating,” Bradford tells GlobeSt.com. “Everyone has put their requirements on hold for a short time to see how things flush out.”

The Kansas City area has a growing demand for distribution facilities, and is working to become a major rail, trucking and air hub, Brandford says. The intermodal designation comes from the air side connection, which will bring in companies that want to have access to the runways. “We’re going to work to market KCI to air cargo operators, air freight logistic providers, as well as aeronautical and aviation manufacturers,” he says.

An airport is a tremendous asset when used by property owners in a proper way, though air cargo is one of the first things to go in a slowdown, Bradford says. “People are using less air freight for components or high-tech elements for the manufacturing process. However, what’s good about air cargo is when the economy turns around, it’s usually the first sector to pick right back up. Plus we’re getting into the peak Christmas-related items to be shipped,” he says.

Phase two of the project will include more infrastructure to 200 acres and the rest of the buildings. Some buildings will be fronted by 4,000 linear feet of runway. Long-range plans call for mixed-use retail development along Tiffany Springs Road, which will be extended west from Interstate 29.Altogether, it will cost around $200 million to build the park, Bradford says. He says it’s too early to provide lease rates. According to a third quarter Grubb & Ellis report, lease rates for the area, which has a 6.1% vacancy rate, average about $3.23 per sf.

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