Cushman & Wakefield released third quarter 2017 statistics recently for the Atlanta industrial market, which indicate the market is poised to break absorption and construction completion records this year.
Year-to-date, the Atlanta industrial market has experienced 16.3 million square feet of occupancy gains, breaking the previous record for an entire year, 2014’s 16.1 million square feet. As we start the fourth quarter, the industrial market is expected to surpass the previous record by millions of square feet. The Northeast submarket is leading the way with 3.3 million square feet of absorption, followed by the Airport/South Atlanta submarket with 3.2 million square feet.
Due to the record amount of occupancy gains so far this year, the vacancy rate has decreased 80 basis points year-over-year to 7.8 percent. This is evidence that demand and absorption are keeping pace with the record amount of new completions.
Construction completions are also approaching a new all-time high. Speculative completions so far this year total 12.1 million square feet, while build-to-suit completions total 3 million square feet. This brings the overall construction completion total to 15.1 million square feet for the first three quarters of 2017. With 14.8 million square feet still under construction, Atlanta is on pace to surpass last year’s delivery record of 17.5 million square feet.
Strong market fundamentals coupled with increasing demand for big-box space make Atlanta one of the top markets in the nation for industrial real estate. Current indicators such as record absorption and strong leasing activity suggest that the Atlanta industrial market will remain active and consistent to close out 2017.
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