Selling SubTropolis: Hunt Midwest works to change perceptions when marketing Kansas City’s underground industrial park

Dick Ringer admits that it can be difficult to convince potential tenants to consider leasing space in Kansas City’s SubTropolis, the world’s largest underground business complex.

But once those tenants actually visit the site? They’re usually hooked, often by the lower utility costs — far lower — that they’ll pay once they’re doing business in this underground industrial park.

“Perception is probably our biggest obstacle to overcome,” said Ringer, assistant general manager of sales and leasing for Hunt Midwest, the Kansas City-based real estate development and mining company that controls the 1,150-acre industrial park. “But when we get in front of the clients and explain the benefits of doing business from this park, we’ll go from being off the list of potential tenants to being in first place on the list.”

Hunt Midwest knows all about the benefits of doing business in SubTropolis. The company, after all, has its headquarters in the park.

SubTropolis was created through the mining of a 270-million-year-old limestone deposit. During the mining process, workers remove limestone, leaving behind 25-foot square pillars resting on 65-foot centers that stand 40 feet apart.

The even spacing of these pillars, the development’s concrete flooring and its 16-foot smooth ceilings make it cost- and time-efficient to create build-to-suit facilities for clients. Hunt Midwest says that tenants requiring 10,000 to 1 million square feet can be in their SubTropolis space within 150 days.

And once these businesses are in SubTropolis, they’ll save money. Hunt Midwest says that SubTropolis features lease rates that are 30 percent to 50 percent lower than those in above-ground facilities. At the same time, businesses operating from SubTropolis average yearly energy savings of 50 percent to 70 percent because of the controlled, consistent climate of the industrial park.

These are the benefits that Hunt Midwest officials use to sell the underground park. They also have to explain that the park is bright and dry at all times, and that it’s nothing like descending into a cave.

It’s why personal tours are often a must for selling space in SubTropolis. And it’s why Hunt Midwest works closely with members of the brokerage community to make sure that these real estate professionals know how to truly sell the facility.

“Inevitably, once people get down there, they’ll get it,” Ringer said. “People will come out after getting a tour and they’ll say, ‘Wow. I had no idea what this would be like.’ They’re always pleasantly surprised.”

Hunt Midwest’s efforts are paying off. During the first half of 2012, Hunt Midwest completed 12 leases totaling nearly 1 million square feet in SubTropolis. New tenants include Nor-Am Cold Storage, the National Archives and Records Administration, Galvmet Steel & HVAC Supply, Mid-Americ Logistics and Knapheide Manufacturing Co.

SubTropolis now offers about 5 million square feet of leasable space. Nearly 50 businesses with 1,500 employees do business from the industrial park today.

“It’s a busy place,” Ringer said. “There is so much activity here. Those businesses who want to reduce their costs of operation are taking a close look at what we offer.”

— Dan Rafter

This entry was posted in industrial real estate, Kansas City commercial real estate, Missouri commercial real estate and tagged , , , , , . Bookmark the permalink.

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