Atlanta Real Estate Market | Industrial Market Report 2020 Q2

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Atlanta industrial real estate market powered by e-commerce in Q2

Key Takeaways

  • The Atlanta industrial market returned to stronger absorption levels in the second quarter of 2020 with occupancy gains totaling just over 4.4 million square feet.
  • Amazon and Walmart were the largest occupancies of the quarter accounting for almost half of net absorption.
  • The balancing act between space absorbed and new inventory delivered led to Atlanta's overall vacancy rate remaining flat, though warehouse vacancy declined 20 basis points (0.2%) this quarter.
  • Leasing activity was dominated by Amazon in Q2. The e-commerce giant transacted 3.7 million square feet of Atlanta's industrial warehouse and distribution space over the three month period.
  • The average industrial rent in Atlanta is quickly approaching $5/SF. Atlanta's industrial market's overall upwards trajectory continues to be strong; however, bulk rents have shown some stagnation as of late.
  • STrong gains in the second quarter brings Atlanta's industrial market back to the average quarterly levels experienced over the past three years. COVID-19's impact to the industrial market here has been minimal so far. The back half of the year looks solid.

Atlanta Industrial Market

As expected, second quarter results show a return to absorption levels the Atlanta industrial market has been used to over the past three years. Net absorption totaled 4.4 million square feet in Q2, bringing the year-to-date total to just over 4.7 million square feet. Million-square-foot occupancies by Amazon and Walmart were the largest of the quarter and contributed to almost half of the net absorption total.

The pandemic has put a premium on e-commerce activity. Amazon is securing locations in the major submarkets to allow it to services its customers in the fastest way possible, expanding its last-mile logistics infrastructure at breakneck speed.

Atlanta's industrial rental rate average is quickly approaching the $5/SF mark overall. IN spite of this, increases in the market's average bulk rental rate has mostly flattened over the past year and a half.

Atlanta Real Estate Market Forecast

The strong second quarter proves the Atlanta industrial market still has legs in its continued expansion. While the COVID-19 pandemic has greatly affected normal business activity in the overall economy, the industrial sector in Atlanta has so far seen more positives than negatives as a result of it.

The expansion of Amazon in Atlanta is beyond expectations and shows the company is taking advantage of new construction in the market to meet its last-mile logistics strategy. 

Even so, COVID-19 still remains an unknown to the market. For now, it does not appear to be greatly impacting Atlanta, with the exception of a slight increase in sublease space availability and also a pause in overall investment activity. With Q2 expected to be the worst it gets in terms of GDP, the focus now shifts to managing the pandemic's overall influence on economic activity.

For Atlanta, it appears the industrial market should come out on top overall. The market's fundamentals and location have been the key drivers to its continued growth, even during the pandemic.


Atlanta Real Estate Market | Industrial Market Report 2020 Q2

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Scott Amoson

Director - Research


Scott is the Director of Research for Colliers International in Atlanta, Georgia.  In his role, Scott supports all of the company's brokers in the Atlanta office.  He also manages the Research Associate in the company, and mentors an intern annually during the summer.

Scott began his real estate career in 2000 as a research assistant with Richard Bowers & Co., a local brokerage firm.  He joined Colliers International in Atlanta in 2003.  Scott specializes in aiding the company's clients with geographical, informational and analytical research.  With his extensive knowledge, he provides customized research data including:  market trends, lease and sales comparables, plats/ownership information, demographics, prospect information and economic information.  In addition to supporting the company's brokers and staff, his other responsibilities include compiling and writing quarterly market and submarket newsletters, maintaining the company's internal database of over 10,000 sales and lease transactions, and tracking news/trends related to Atlanta's commercial real estate market.  He is frequently called upon by local news sources for his knowledge and expertise of real estate matters in Atlanta.

As a member of the Colliers International Research Council, he advises on quarterly conference calls and provides valuable input on matters directing the research platform for Colliers International.  Scott was recently selected as the Research Ambassador for the Southeast Region as a part of Colliers International's Centers of Excellence platform.

Scott is a native of Atlanta, and enjoys spending time with his wife Lupe and daughter Sienna.  He is an avid golfer and loves vacationing with family.

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