Why Atlanta is Emerging as a Top City for CRE

One of America’s top cities for real estate is getting even stronger. Atlanta, Georgia recently broke ground for one of the country’s most anticipated and massive CBD developments. The $5 billion project, known as Centennial Yards, is set to include 4 million square feet of office, retail and hotel space and 4 million square feet of residential buildings. 

On track to be completed before the 2026 World Cup in Atlanta, the impressive development is sure to keep Atlanta in the spotlight of the CRE (Corporate Real Estate) world for the foreseeable future.  

Read on to learn more about:  

• Atlanta’s emerging status as a CRE powerhouse 
• Recent developments the city is making  
• How demand has sustained across multiple markets  
• Opportunities tenants have 

Atlanta’s CRE Powerhouse Status  

Atlanta is a hotbed commercial real estate market for multiple regions. From its abundance of top talent and affordability to its status in the country’s top 10 GDPs, the Georgian city is highly strategic for long-term growth. Yet, the property value of commercial spaces in Atlanta is still a fraction of what you would pay in other cities like NYC or San Francisco. 

Accordingly, the Georgian city is a top location for businesses. It has lured in 29 of America’s largest Fortune 500 corporations and 203 of the nation’s fastest-growing private companies. But it is not just businesses taking advantage of the local economy. Atlanta saw 14% population growth in the past decade, making it one of the nation’s primary markets to pay attention to. Atlanta is also great for sourcing talent. Graduates from top schools including Emory, Georgia Tech, Morehouse, etc flood the city. 

Atlanta jumped five spots this year to be named the third best city for real estate by the Urban Land Institute. And with the $5 billion development in pursuit, Atlanta’s star is only sure to rise even more. The city is experiencing booming successes,  

Part of this is the phenomenon of Southern growth that has occurred in the last decade. While the rest of the country has been struggling, especially since the pandemic, the Southern region has dominated over other economies.  

Image source: 42 floors 

Atlanta's New Centennial Yards Development

Atlanta is not risking being outpaced by its own success. The city is fully capitalizing on its quickly growing reputation, securing the coveted host position of the 2026 world cup.

Municipalities are now funneling $5 billion (about $15 per person in the US) into local people and businesses to ensure the area is fully equipped to carry the growth projected to occur in the next few years.  

The Centennial Yards development is set to reinvigorate the downtown Atlanta area. All said and done, the project will be 50 acres and 8 million square feet of mixed-use land. Hotels and residential developments are plotted to be completed first followed by the office component, which according to a report in the Atlanta Journal-Constitution, “will include a triple tower topping out at 28 stories, encompassing 520K square feet. The tower will include 19K square feet of amenities and 22K square feet of terraces. The roof will feature landscaping.”  

Image source: Curbed Atlanta

So, we are talking premium, Class A office space ripe for the taking by businesses that want to get a piece of Atlanta’s growing market.

But that doesn’t mean that businesses looking to expand their footprint in Atlanta won’t get a good deal. It is still a tenant’s market. In fact, the city is deliberately building the office space after the other developments to avoid a glut of available office space. According to GlobeST, the Atlanta market “had 2.1 million square feet of deliveries while another 3.2 million square feet is under construction at a time when the office vacancy rate has hit 17%.”  

If you’re looking for office space in Atlanta (or anywhere else for that matter), there are a lot of factors to keep in mind. Check out our free course on how to find the optimal office space.  

Opportunities for Atlanta Corporate Tenants 

So, even though the growing Atlanta market is plotted to gain more traction, CRE will remain affordable for savvy tenants. Atlanta property owners are still competing for tenants and will only get more competitive once an additional multi-million square feet becomes available on the market. GlobeST continued that

This puts tenants in the perfect position to negotiate for more favorable terms, prices, and concessions. Because of this, Tenant Reps are a stronger weapon than ever. Proper negotiation can help you take full advantage of your position in a booming market, so make sure you team up with a professional who can skillfully leverage the value of your tenancy. But regardless, you should prepare yourself by learning the commercial lease negotiation tips from the experts in this article: 6 Commercial Lease Negotiation Tips from Pro Tenant Reps. 

Atlanta Industrial Demand  

Atlanta is also witnessing success across multiple domains. While the office, hospitality, and residential sectors have been getting most of the hype, they’re not the only growing markets. Atlanta’s industrial performance has been steadily climbing for the last few years. The logistics hub has added 92 million square feet of industrial and warehouse space since 2010, according to Urbanize Atlanta.  

Increased interest in warehouse space is being reflected in growing rents.

And developers are rushing to keep up with the resilient demand. According to Bisnow, “There is a whopping 44 million square feet of industrial space in the third quarter... Vacancy remains at 3.7%.  

Only a handful of cities in the nation have witnessed such real estate development in the last decade, with Atlanta being one of them. It’s also among the few cities to experience the number of office-using jobs to return to pre-pandemic levels. 

However, we'd be remiss not to mention Atlanta's traffic problem. The city is notorious for congestion. A 2021 Global Traffic Scorecard estimated that the average Atlanta driver loses 53 hours to congestion each year, with a cost per driver of $820. At the heart of this issue, many attribute the failed MARTA rail system, their mass-transit that doesn't cover the entire metropolitan region. Think about what the new development will do to traffic congestion. 

Also, in recent years, planners have attempted to connect various Atlanta communities with a 22-mile long loop known as the BeltLine. What was intended to bridge the divide between affluent and underprivileged Atlantans is now having an inordinate effect on home values. The joint public and private project built multi-use trails (for biking, jogging, etc) on abandoned railroad tracks. Along the BeltLine is access to facilities and safe streets without the need for a vehicle. However, gentrification has become a severe issue, as home values along the BeltLine have out priced its original citizens. The development is still under scrutiny and still evolving. 

Relocate to Atlanta with a Tenant Rep  

If you want a piece of Atlanta’s booming market, you are not alone. As we mentioned earlier, the Southern tier of the US, known as the sunbelt, has witnessed extreme corporate interest in the last few years. Atlanta is a standout city in this region known as the “Business center of the Southeast,” where 2 million jobs are expected to be introduced by 2040. With this interest comes the transplants. Recent companies to relocate to Atlanta include:  

• Airbnb 
• Honeywell 
• GE Digital  
• BlackRock 

They are joining the ranks of large-scale organizations that already had footing in the city including:  

• Coca Cola 
• Home Depot 
• UPS 
• Delta 
• Porsche 
• Mercedes Benz  
• Microsoft (among many others)  

Atlanta has proved itself as a source of fostering talent and local business growth. The city makes a point to invest in its citizens and development so businesses looking to relocate may be able to offset the cost of doing so. Multiple corporate incentive programs, grants, and initiatives exist, sponsored by the Atlanta government, to encourage growth.  

So don’t miss the opportunity to get in on one of the fastest growing markets in the US. If you want to relocate to Atlanta, there has never been a better opportunity to do so. The city’s sustained growth coupled with its eagerness to build further make it extremely business-friendly. Take full advantage of these benefits and relocate with a Tenant Rep. As true Tenant Reps with over 30+ years of experience finding our corporate clients the best properties, we are ready to help. We have a proven, 7 step process to get you the optimal terms, price, and overall lease. Learn what the steps are in the most efficient process to find office space in the free course.  

If you’re already too busy to take a course but want the benefit of working with a Tenant Rep, just call one up! Work with a true Tenant Rep at iOptimize Realty^® today.