Will Multi-Family & Retail Continue to Grow in 2014?

Housing Starts

2013 brought about construction activity that the city hasn’t seen since the mid-2000s, and most of the projects being developed are in the multi-family sector. We’ve seen so many units added to the pipeline in the last 12 months that some are already speculating that Atlanta is at risk of creating a “multi-family bubble,” which could ultimately set the city back in years to come. More than 10,000 units will be added across Metro Atlanta; this activity has created 13,200 construction jobs in the last year alone. Just as in 2013, most speculate that most multi-family construction will continue to happen in urban, infill locations, but that Class B and C properties in good locations will experience strong rent growths as new in-town locations lease up. Urban locations will be the primary target for new developments due to the increased demand for walkable communities by young professionals who wants to live and play where they work.

Multi-family isn’t the only sector making additions, though. The retail sector has seen some exciting new projects break ground in the past year, including Buckhead Atlanta (formerly known as The Streets of Buckhead), Ponce City Market (whose office space is now entirely leased up), and the Avalon project in Alpharetta (which will also include multi-family units).  In 2014, we can expect to see retail stores reduce their size in an effort to minimize overhead – but you shouldn’t worry about increased vacancy rates. That’s because a major trend that’s emerged coming out of 2013 is healthcare offices’ eagerness to leave hospital and medical office projects for these retail locations; typically, these types of locations are more centrally-located to their patient base and offer significantly more parking.

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