Year End 2018 Industrial Report

In 2018 the metro Atlanta industrial market continued to trend positive setting new highs in values, transaction volume and rents. Overall, this is one of the stronger market segments in Metro Atlanta with most market participants projecting positive growth into 2019.  Below is a quick summary of the Year End 2018 Metro Atlanta Industrial Market stats 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 16,800 industrial buildings were identified in metro Atlanta housing about 757.0 million square feet. Supply has been increasing since 2012 and dramatically since 2015.

VACANCY TRENDS

After several sluggish post recession years, Atlanta’s industrial market began to improve in 2012. Vacancy rates have generally trended down since 2012 currently at a post recession low in spite of new construction.

ABSORPTION, DELIVERIES & UNDER CONSTRUCTION

After five plus years of virtually no new product after the 2008 crash, new construction began again in 2014 with a spike in deliveries in 2016. There continues to be 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.

TRANSACTION VOLUME

Sales activity in the market has generally trended up since 2012 with 2018 recording the seven year high.

VALUATION HISTORY

Values have trended up since 2012 while cap rates were compressing through 2015.  Cap rates were moving back up modestly through 2017 most likely as a result of the Fed’s interest rate hikes but values continued to enhance. In 2018 cap rates reached a 7 year low with continued value increases.

RENT TRENDS

As displayed above, rent growth has continued to be positive since 2012 with 2018 topping the $5.00 per square foot barrier.

CONCLUSION

The metro Atlanta industrial market continues to trend positive with 2018 setting new highs in values, transaction volume and rents. Demand continues to grow reflected in both vacancies and rents at 7 year record levels and significant new construction in the pipeline.  Overall, this is one of the stronger market segments in Metro Atlanta with most market participants projecting positive growth into 2019.

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