Kansas City Plans to Develop Its Large Land Holdings

"We are working on the first phase of a master plan that involves about 100 acres," said Kevin Wilkerson, a vice president at Trammell Crow based in Kansas City.

Wilkerson said his company wants to break ground this year on what he described as a speculative building for distribution use. The scope of the project is still being determined, but it probably would be at least 300,000 square feet.

"We've had a few inquiries, but we have no tenant in tow," he said.

Steven Bradford, a principal who leads Trammell Crow's airport development group based in Dallas, emphasized that much remains to be done to determine the cost of developing the KCI property.

"We believe there is a market opportunity at KCI, but the bulk of our time and energy has been focused on infrastructure and master planning," he said.

David Long, the airport assistant director for commercial development, said that no estimate has been completed yet as to the cost of building the infrastructure required for development, but that it will run into the millions of dollars.

A final estimate as to how much the city will contribute and what Trammell Crow will invest is expected next month.

Because the airport is self-supporting, it can use its own funds when it comes to paying for infrastructure costs associated with preparing the land for development.

The total operating revenues at the Aviation Department for fiscal year 2006, which ended April 30, were $80.4 million, up 13.4 percent from the previous fiscal year. Those revenues come from both KCI and Wheeler Downtown Airport.

The biggest source of operating revenue was associated with parking, $35.8 million, followed by airfield fees, $11.7 million; terminal fees, $10.9 million; auto rental fees and concessions, $8.4 million; and aviation-related property rentals, $4.4 million.

Only about $3.5 million of the airports' operating revenues came from non-aviation property rentals last year, just 4.4 percent of the total.

That non-aviation revenue share is what airport officials want to grow dramatically through property development and renting space at the former Farmland building, which has now been renamed the Ambassador Building at KCI.

Chris Gutierrez, president of Kansas City SmartPort, said the airport's strategy fits well with a push to use Kansas City's geographic location to attract more distribution and warehouse facilities.

He counted the airport as being one of three major intermodal transportation hubs now being built in the area. The others are train and truck complexes being developed by BNSF near Gardner, and Kansas City Southern at the former Richards-Gebaur Memorial Airport in south Kansas City.

He praised airport officials for hiring Trammell Crow to develop what is being called the KCI Business Airpark.

"Trammell Crow has the connections to attract people," he said.

He added the KCI property also is within a foreign trade zone and eligible for other economic incentives from Missouri. The trade zone designation allows companies to import parts and raw materials to the site without paying costly duty taxes. The duty is paid only when the finished item is shipped out of the zone.

Bob Marcusse, president and CEO of the Kansas City Area Development Council, said the airport finally has aggressive leadership when it comes to economic development.

"They have a unique and exciting piece of property, and have the mindset of a dealmaker now," he said. "The team running the airport today is a more aggressive economic development team than we've seen in the past."

Marcusse said the previous mindset had been to pursue big projects.

In the early 1990s, the push was for a major manufacturing facility then being pursued by aircraft maker McDonnell Douglas.

"I think the approach they're taking now is good," he said.

One major air-service-oriented operation that has remained has been the maintenance facility now operated by American Airlines. The airline employs 900 people at the facility.