Business

More federal workers moving to Kansas City’s downtown

Vicki Russaw unpacked her work items in her new office recently inside the Two Pershing Square office building at 2300 Main St. Russaw is one of about 900 General Services Administration employees who are moving from the Bannister Federal Complex to the downtown location.
Vicki Russaw unpacked her work items in her new office recently inside the Two Pershing Square office building at 2300 Main St. Russaw is one of about 900 General Services Administration employees who are moving from the Bannister Federal Complex to the downtown location. The Kansas City Star

Uncle Sam likes downtown Kansas City.

Always has.

Even when private industry — excepting law firms and banking companies — fled for the suburbs, government kept the city’s central business district somewhat alive.

Nearly one in eight downtown workers are federal employees, and federal offices occupy nearly one-fourth of the business core’s decent-quality office space.

Said with numbers: That’s 10,000 workers out of about 77,000 working in the area between the Missouri River and 31st Street. And it’s 3.5 million square feet out of 13 million Class A and Class B office space.

How much is 3.5 million square feet? That’s the size of the 104-story new One World Trade Center in New York City.

Now, with Kansas City’s downtown housing booming, its entertainment options abounding, and private companies in a re-energized push to lease, buy and rehabilitate office space, the federal government is fortifying its office dominance.

In the latest move, the General Services Administration is two-thirds of the way through moving about 900 employees from the mammoth Bannister Federal Complex in south Kansas City to 2300 Main St. It’s taking all or parts of six floors in Two Pershing Square, about 140,000 square feet.

The new-to-downtown GSA workers, moving in stages over three months, are getting close-up views of Union Station on one side and the downtown skyline on the other.

“It’s a different vibe, like being rejuvenated,” said Kiva Simmons-Lee, an asset manager in GSA’s public buildings service division, who moved to the downtown space in February. “I’ve been to Crown Center a couple of times for lunch, gotten things to go from Harvey’s in Union Station, and can’t wait for warm weather to walk around more.”

She’s even OK with the longer commute from her home in Gardner and the $47 a month she’s pays for covered parking next to Union Station: “It’s the best $47 I’ve ever spent.”

That’s music to the ears of GSA regional administrator Jason Klumb, the official with oversight over most of the federal government’s real estate in the Kansas City area. He wants taxpayer investment to work for the employee as well as the employer.

A lot of workers are affected. Klumb believes Kansas City’s downtown may have the highest concentration of federal workers per capita of any U.S. city outside of Washington.

About 10,000 federal employees work within or adjacent to the downtown freeway loop. That’s one-fourth of the federal government’s overall employment of about 38,000 in the Kansas City area, which makes Uncle Sam the largest employer in the metro area and the largest downtown.

And they’re good employees to have, “a pretty high-quality workforce,” Klumb says, with solid yearly salaries.

Federal agencies occupy all or parts of 19 downtown buildings, including the sprawling Internal Revenue Service center on Pershing Road and the massive Richard Bolling Federal Building on East 12th Street.

That building tally excludes the Federal Reserve tower south of the Liberty Memorial. Federal Reserve Banks are not federal departments or agencies.

The 1.2 million-square-foot, 18-story Bolling building, which stretches over two blocks downtown, has been Uncle Sam’s signature work site for five decades. It recently had a four-phase, 15-year, $285 million remodeling to upgrade internal systems and begin brightening its 1960s-era decor.

About 3,000 employees in a dozen federal agencies work in that high-security domain, some of them on floors that have undertaken agency-by-agency spruce-ups.

“We’re in a highly competitive situation to recruit and retain people,” said Timothy Kurgan, a deputy chief in the U.S. Army Corps of Engineers, who works in the Corps’ updated Bolling offices. “We’re competing for engineers, geologists, hydrologists. … A better environment works out very well for us — maybe not to recruit, but it sure helps us retain.”

North of the Bolling building is the Charles Evans Whittaker U.S. Courthouse on East Ninth Street, another large, secure federal structure downtown. It’s home to federal district, appellate and bankruptcy courts, related attorneys’ offices and legal programs, and a few other agencies.

The IRS service center and the Federal Bureau of Investigation also have high-security buildings of their own just outside the downtown freeway loop.

Most other federal workers are scattered in downtown sites, some as small as a partial floor in a single office tower. Because of the nature of some of their jobs, they don’t necessarily want the public to know they’re there because they lack the security screening of the larger federal buildings.

Wherever the federal workers are, Kansas City developers are glad to have them. In fact, Sean O’Byrne, vice president at the Downtown Council, used the word “ecstatic.”

“The office market is the last to recover from any downturn,” O’Byrne said. “Downtown now has a grocery, a school, entertainment, new housing. We’re starting to show an uptick in the office market, and the federal government is a great market for us.”

A national study, published in February, that gathered data through 2011 found that Kansas City and Las Vegas had been the biggest laggards in adding jobs in their downtowns compared with other cities rebounding from the 2008 recession. O’Byrne and other Kansas City officials believe a more recent data collection would capture more job growth.

Meanwhile, moving the GSA offices to the downtown building also benefits taxpayers, Klumb said. The agency’s 20-year lease for $16 a square foot at Two Pershing Square “saves us about $64 million from continuing to operate where we were on Bannister, and it’s much cheaper than if GSA had built a new building somewhere.”

Klumb also noted that a federal executive order requires federal agencies to consider central business districts first. GSA, the federal real estate administrator, also generally prefers the flexibility of leasing over buying space because it’s easier to make a change, if necessary.

Across the state line, in downtown Kansas City, Kan., Klumb noted, the Environmental Protection Agency pulled up stakes after a landlord dispute and found a better deal in a former Applebee’s headquarters building in Lenexa. It was, he said, an uncharacteristic move to suburbia, according to GSA preferences, but it benefited taxpayers.

Still, “we like downtowns,’ Klumb said. “Being downtown fits with our desire to encourage public transportation. We like being part of the solution.”

To reach Diane Stafford, call 816-234-4359 or send email to stafford@kcstar.com. Follow her online at kansascity.com/workplace and @kcstarstafford.

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