Local commercial real estate agents see promise in the new year.
Developers and commercial real estate agents in Jefferson City said investments by property owners in commercial buildings spiked last year because of a strong economy and high consumer sentiment. Heading further into 2019, developers suggest Mid-Missouri will shrug off any long-term effects of the partial-government shutdown and keep investing in buildings.
Renovated buildings in Jefferson City had their highest combined value in 31 years, according to statistics provided by Jefferson City. Non-residential renovated buildings had a value of $79.56 million, more than double the value of the $34.29 million renovated buildings were worth during 2017.
During the last 31 years, only in 2012 were new non-residential construction projects worth more than they were worth in 2018, according to city records. Last year, the city issued 12 building permits worth $67.9 million. In 2017, the city issued seven permits for new non-residential buildings worth $23 million.
Jefferson City Building Official Larry Burkhardt cautioned that much of the value of new and renovated projects is reflected in the renovation of Jefferson City High School and construction of Capital City High School. Still, Burkhardt said, last year was a banner year for commercial real estate around the city.
"It just seems like it's getting busier," Burkhardt said. "We're seeing a lot more action."
In 2018, Jefferson City issued 155 non-residential construction permits for expansions and remodels of buildings, 11 fewer permits than the 166 permits for non-residential renovations and expansions the city issued in 2017.
"We dropped a little on the number of expansions and remodels, but it seems like we're getting bigger expansions and remodels," Burkhardt said.
Commercial real estate agents like Dan Gordon and Larry Kolb say the pace of commercial construction projects is picking up. Gordon owns several buildings around Jefferson City including a recently expanded space at 2021 Missouri Blvd. and the former home of Goodwill at 1806 Missouri Blvd.
"I would say it's picked up quite a bit," Gordon said. "We're seeing an increase in prices, and we're also seeing an increase in activity."
Kolb, who owns several shopping plazas around Jefferson City, also noticed an uptick in commercial activity last year. During the Great Recession, the state vacated several buildings, he said. Those buildings are now filled by local businesses, he said.
Without many office buildings left to lease, the city last year saw construction start on about five new office buildings, Kolb said. Like Gordon, Kolb said a strong economy and low unemployment drove the confidence of consumers and business owners higher in 2018.
"I think we're past the 2008 drama," he said. "A lot of businesses were sitting there waiting for things to happen with a lot of cash. Now they're starting to do some things."
Gordon and Kolb expect areas near the Stoneridge Village shopping complex and areas off of Missouri Boulevard to be developed more fully in the coming years. Areas near West Edgewood Drive still have room for future development, Kolb said.
Kolb owns the former home of Here Today at 2233 Missouri Blvd. Here Today closed all 10 of its stores in December after a large investor pulled out of the company. At the time, the company said it hoped to reopen its stores sometime this spring.
For now, Kolb is leasing the building. Large retail buildings like that, the old Goodwill building and Gordon's building at 2021 Missouri Blvd., are harder to lease than small retail buildings, he said.
"There's just not that many regional, national tenants coming into Jeff City," he said.
The partial shutdown of the federal government enters its 35th day today. With few federal workers residing in Jefferson City, Gordon said, the city should weather any economic storms ahead fairly easily.
"(The shutdown) will affect GDP slightly, but it depends on how long it goes," Gordon said.
Any impact the city feels will be mitigated after the shutdown ends, Kolb said. "As soon as it stops, (growth) will jump right back up," he said.