February 07, 2018
ATLANTA – Atlanta’s industrial vacancy decreased to 6.7 percent at the close of 2017’s fourth quarter, its lowest level in more than a decade, down from 7.2 percent in the third quarter. The market saw nearly 18.5 million square feet of new industrial deliveries during the year, more than 60 percent of which is leased, and near-record levels of absorption at more than 21 million square feet annually. According to Transwestern’s fourth-quarter 2017 Atlanta industrial market report, demand for quality product is strong, causing a continued uptick in absorption and construction.
“Demand has prompted 21.2 million square feet of industrial construction as of fourth quarter 2017,” said Keith Pierce, Transwestern Director of Research for the Southeast U.S. “As such, 2018 is likely to see the highest level of new deliveries on record in Atlanta. Additionally, we expect the market to see lower vacancy rates and rent growth this year as substantial levels of new product continue to be absorbed.”
Fourth-quarter average asking rents were $3.94 per square foot, up 3 percent in the past 12 months to the highest level reported in Atlanta in 15 years. Vacancy is lowest in submarkets where construction has been limited, but almost every submarket reported vacancy below 7 percent.
Additional highlights from Transwestern’s fourth-quarter 2017 Atlanta industrial report include:
· Atlanta enjoyed a healthy economy in 2017 that continues to outperform the nation. The market’s unemployment rate is at its lowest point in a decade, at 4.1 percent.
· Approximately 4.6 million square feet in Atlanta was absorbed in the fourth quarter, which contributed to a total of more than 21 million square feet absorbed in 2017.
· The strongest quarterly absorption was in the traditional industrial strongholds of Northeast and South Atlanta. In fact, for 2017, South Atlanta has seen nearly two-thirds of the Atlanta market’s demand, as well as most of its new construction.
· Atlanta’s average industrial sale price is up 10 percent from 2016 at $54 per square foot.
Download the full report at: https://tinyurl.com/transwestern-atl-4Q2017Industr.
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