New owners plan to redevelop, rename and build more on Overland Park’s Sprint Campus
New owners of the Sprint Campus plan to rename, renovate and expand the sprawling office park in Overland Park.
Wichita-based real estate development firm Occidental Management, which purchased the campus from Sprint Corp. in July 2019, announced plans Wednesday to renovate existing buildings and add as much as 2.7 million square feet in new construction. The company plans to add new multi-family housing, office, retail and restaurant space.
Sprint opened its iconic campus in 2001 but as the telecommunications company’s fortunes changed, it dramatically reduced its workforce on the 190-acre site, which has nearly 4 million square feet of office space. T-Mobile, headquartered in the Seattle area, completed its $26 billion merger with Overland Park-based Sprint in April.
The campus was designed to emulate the feel of a college campus with brick buildings, grassy lawns, a clock tower and an amphitheater. Occidental plans to bring a more modern look to the site, both by renovating current buildings and erecting new ones.
Preliminary development plans show towering glass buildings, water features and outdoor dining and entertainment areas.
“This first-look at development plans for the expansive campus is just the beginning,” Gary Oborny, Occidental Management chairman and CEO, said in a news release. “Our team has spent the past year researching and brainstorming the best approach to bringing an innovative, world-class live-work-play environment to the center of the country.”
Sprint sold its campus for $250.9 million — tens of millions of dollars below Johnson County’s appraised value of $342.5 million at the time, according to research compiled by the investment research firm Moody’s. In exchange for what Moody’s characterized as a “modest” sale price, Sprint secured a 10-year lease of office space well below market rent.
While the phone company originally designed the campus to house more than 14,000 employees, its footprint has shrunk to about 5,000 workers. T-Mobile now leases four buildings on the campus, Occidental officials said.
Occidental has also redeveloped the nearby Overland Park XChange, formerly called the Overland Park International Trade building.
Occidental planned to file its redevelopment plans with the city on Wednesday. It’s unclear whether the company will seek financial incentives for the project and Occidental did not say how much it expects to spend on the redevelopment.
The company said it will make a series of further announcements this year about development plans, including a new name for the mixed-use campus.
“The vision includes a place for all people — it will be a diamond in the Midwest that attracts innovative companies to migrate their headquarters to the region,” Oborny said in the news release. “But it will also serve as a community gathering space for people of all ages and interests.”
The pandemic has affected the office market across the Kansas City metro area: Office vacancies were declining through the end of 2019, ending the year at 13.7%. By the second quarter of this year, the vacancy rate ticked up to 15.1%, according to research from commercial real estate firm Cushman & Wakefield.
But major office projects are conceived with an eye toward the long-term.
“You can’t deliver those kind of buildings in a couple of months,” said Matt Nevinger, associate research director at Cushman & Wakefield’s Kansas City office. “Letting the disruptions of 2020 completely change your outlook on what trends will be like two to three years from now is probably shortsighted.”
The Sprint Campus sits in one of the metro area’s most robust commercial real estate markets.
Along with offices around the Country Club Plaza, Johnson County touts the highest office rents in the metro area — outpacing the asking rates in even downtown Kansas City.
And demand for new commercial real estate continues to grow around the Sprint Campus. Nevinger pointed to Creative Planning’s new corporate offices just off Interstate 435 and the growing mixed-use CityPlace development.
“The long-term outlook for the Kansas City office market remains healthy and the fundamentals are still strong,” he said.
Overland Park officials are still evaluating Occidental’s plans. Officials tentatively expect the planning commission to review plans November 9 before going before the city council in early December.
In a statement to The Star, the city’s planning & development services director Jack Messer said the campus has been an important piece of Overland Park’s office environment for the last 20 years. He didn’t weigh in on Occidental’s plans, but said officials look forward to learning more.
“We have not yet reviewed the proposed enhancement,” his statement said, “but as with all private property owners and their development proposals we will work with Occidental and the community through our regular land use planning process that has proven to make Overland Park one of the top cities in the country.”
This story was originally published September 16, 2020 at 2:01 PM.
