Sizzling Outlook for ATL in 2014
It will be a better year for Atlanta, if JLL's local chief is accurate. (He's not a weatherman, so we believe him.)
Here's JLL's Mike Sivewright (pictured last year because we forgot to take one yesterday; we were too focused on the delicious sausage biscuits at JLL's forecast breakfast). He says with Atlanta coming off 2013 producing more than 60,000 jobs and more than three requirements floating around the market needing in excess of 500k SF, our real estate fortunes are brighter.
Mike kicked off the forecast at the St. Regis with a panel that included ULI's Jeff DuFresne, Midtown Alliance's Kevin Green, and apartment prognosticator Haddow & Co's David Haddow. Jeff calls Atlanta a “college town” on par with Boston and Berkley, given GA Tech being “catalytic” to innovation here. And he says growth will happen in the urban core of Atlanta and in urban core-like suburban areas, such as North American Properties' Avalon.
David is seeing “significant activity on the rental side” with apartments, leading to a 97% Intown occupancy. Even with 7,000 units under construction, he's not sounding the alarm of overbuilding, given we had near zero deliveries in the four years prior. (Similiarly, we've had zero Girl Scout cookies delivered in the past year, so we can buy a bunch now without fear of overeating.) But David did say that the balance between renting and owning is shrinking with $1.65/SF rents being the same as $250/SF in an average home purchase. And he doubts that the desire of Millennials to rent will be a long-term mindset.
We ran into Parkway Properties' Jason Bates and John Barton. They're hunting for office product to buy, but John declined to elucidate. Could it be Duke Realty/Pope & Land's 3630 Peachtree, which is being marketed for sale by CBRE? No comment and a big smile.
John did share this with us: Yes, that's a digger in Capital City Plaza (probably a pain to stand next to that thing in the elevator) working on lobby renovations in preparation for PulteCorp's move-in, happening even sooner than originally planned. John says Parkway is slotting a corner lobby space that it plans to market to a “farm-to-table” restaurant.