1st Quarter 2019 Industrial Report

Industrial Market Summary

The metro Atlanta industrial market continues to trend positive. Construction remains strong and could be off some concern. Nevertheless, there is continued growth, albeit it slowing, in rents and sales values. Overall, this is one of the stronger market segments in Metro Atlanta with most market participants projecting positive growth throughout 2019.

Below is a quick summary of the Q1 2019 Metro Atlanta Industrial Market stats that lead to the conclusions above as compiled by Crossroads Appraisal Group from information obtained from CoStar. If you would like a PDF version of the information below, it is available here for your convenience.

SUPPLY

A total of 16,873 industrial buildings were identified in metro Atlanta housing about 764.0 million square feet. Supply has been increasing since 2013 and dramatically since 2016 which continued into Q1-2019.

VACANCY TRENDS

After several sluggish post recession years, Atlanta’s industrial market began to improve in 2013. Vacancy rates have generally trended down since then in spite of new construction but ticked back up slightly in Q1 of 2019.

ABSORPTION, DELIVERIES & UNDER CONSTRUCTION

The strong construction numbers that began in 2014 continues with a robust pipeline of new product. However, a majority of the new construction is large buildings as the supply of smaller owner user properties continues to tighten. Absorption numbers declined in Q1-2019 and will need to be monitored as the year progresses to see if that continues.

TRANSACTION VOLUME

Sales activity in the market has trended up since 2014 with 2018 recording the six year high. Q1-2019 volume is slightly off the pace of 2018.

VALUATION HISTORY

Values trended up since 2013 while cap rates were compressing through 2015.  Cap rates moved back up modestly through 2017 most likely as a result of the Fed’s interest rate hikes. 2018 saw peak levels for both metrics with a slight pull back in cap rates for Q1-2019 while values continued their upward trend.

RENT TRENDS

As displayed above, rent growth has continued to be positive since 2013 with the rate of growth slowing in Q1-2019.

Leave a Reply

UA-66089126-1
Menu Title