Atlanta Sees Nearly Twice National Growth Rate in This Area

Dan Wagner

ATLANTA—Atlanta is seeing development of warehouses and distribution centers at nearly twice the rate of 12 other primary US inland part markets. That’s according to CBRE Group . “Atlanta’s industrial market has achieved a healthy balance as developers are reacting to the natural drawdown of available supply,” Dan Wagner , CBRE Southeast research manager, tells GlobeSt.com. “Atlanta saw a drop in both the vacancy rate and the overall level of development during the second quarter of 2016, indicating that construction starts are not outpacing demand. While new construction levels are significant, so is tenant demand, so the threat of overbuilding is small as of mid-year 2016 . If anything, the market is supply constrained—not since 2001 has the market been this tight.” Fueled by the rise of e-commerce, demand for industrial buildings in these 12 markets is so strong that nine of them have witnessed occupancy rate decline from post-recession peaks faster than the national rate. The other areas are: Southern California’s Inland Empire; Phoenix; Dallas/Ft. Worth; Kansas City; Houston; St. Louis; Chicago; Memphis, Tenn.; Columbus, Ohio; Greenville, S.C.; and East and Central Pennsylvania. “Georgia’s combination of seaport, rail and intermodal along with our interstate system provides an excellent route for goods to reach Atlanta’s expanding population base,” says Todd Barton , first vice president of industrial and logistics for CBRE in Atlanta. “E-commerce related warehouse requirements continue to bolster Atlanta’s vibrant industrial market, where net absorption of space is on track to outpace previous numbers for the fifth year in a row.” Atlanta benefits from its proximity to the Port of Savannah and connectivity to the Southeast. With 31.8 million people within 300 miles, and an industrial growth rate of more than twice the national pace, Atlanta’s consumer pool supports a stable industrial environment. “Inland ports account for more than half of the fastest growing industrial markets in the US because they are key way stations in the national e-commerce distribution network,” says David Egan , CBRE’s Head of Industrial & Logistics Research in the Americas. “As online commerce continues to expand, more shippers, retailers and logistics firms will seek top-quality, big-box warehouses in the leading inland-port markets to serve as critical links in their supply chains.”