X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.

(To read more on the industrial market, click here.)

ATLANTA-Despite 9.74 million sf of new industrial product under development, leasing activity in the metro area’s 505-million-sf market is headed for a record 15 million sf this year, according to a new market analysis by locally based Colliers Cauble Co.

At mid-year, net absorption stood at 6.5 million sf, or a one-million-sf increase over the same 2004 period. “The Atlanta industrial market is as strong as it has ever been, in sync with its best performances of the late 90s,” says Colliers Cauble research director Scott Amoson. “From a period two years ago with a bleak outlook on the market, to seven consecutive quarters of absorption levels in the millions of square feet, activity has moved forward quite quickly in a short amount of time.”

Amoson says “demand for industrial product in Atlanta has continued to strengthen.” Vacancy of 11.6% is down 1.8% from this time last year.

“Move-ins and build-to-suits by companies located to the South Atlanta and Northeast Atlanta industrial submarkets have accounted for just over 50% of total market absorption in the metro area for second quarter,” Amoson notes. “Current dynamics suggest the Atlanta industrial market will easily top 10 million sf in absorption for the year. The best outlook places the market at a level reaching the 15-million-sf mark.”

The researcher considers that performance unprecedented since new construction levels are the highest they have been in five years. Of the 9.74 million sf under construction, 62% is warehouse and 38% is shallow-bay.

Amoson also predicts the overall vacancy rate will fall below 10% by year end. “Vacancy in the market has continued to put downward pressure on rental rates,” he says. When the vacancy level drops below 10%, “landlords will begin to see some rate increase for their properties,” the analyst says.

Flex industrial rents now are the in the $5- to $7-per-sf range. Shallow-bay and distribution space is renting for $2.75 to $3.75 per sf. Warehouse properties are leasing for $2.50 to $2.75 per sf.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 3 free articles* across the ALM subscription network every 30 days
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?

GlobeSt

Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2020 ALM Media Properties, LLC. All Rights Reserved.