WANT TO BUY OR SELL A PROPERTY?
Current Trends Shaping the Commercial Real Estate Market in Georgia
The commercial real estate (CRE) market is undergoing significant changes in 2024, driven by various economic, technological, and societal factors. Here are some of the key trends shaping the landscape and how Atlas can help.
High Interest Rates
Interest rates have remained elevated, creating a challenging environment for CRE financing. This "higher-for-longer" rate scenario is pushing investors and developers to rethink their strategies. Refinancing existing debt has become more expensive, leading to a cautious approach to new investments and development. Rather than shy away from a difficult market, we believe that is the best time to get creative and consider alternative ways to create value.
Vacancy Rates in Office Spaces
Vacancy rates for office spaces remain high in most markets, and Georgia is no exception. With hybrid and remote work models becoming the new normal, the demand for traditional office space has been significantly reduced. By crafting flexible lease terms and identifying amenities that attract tenants, we have been able to bring new tenants into traditional spaces for many of our clients this year.
Strength in Industrial
Despite challenges in office real estate, the industrial sector across the country remains robust, benefiting from the ongoing e-commerce boom. Here in Georgia, major metropolitan areas are benefiting from increased investment in warehousing and distribution centers, which are essential to meet the growing consumer demand for quick and efficient delivery services. It is evident that companies are looking to optimize supply chain logistics, making
Georgia
a prime location due to its strategic position and transportation infrastructure.
Focus on Sustainability
Sustainability has become a central focus in CRE, with both investors and developers making it a priority. Both have started prioritizing green and sustainable practices to meet the increasing demand for environmentally friendly properties. This includes the incorporation of energy-efficient systems, sustainable materials, and designs that reduce the overall carbon footprint of buildings. As a LEED AP
Kyle Nelson
has extensive knowledge of green building concepts and can help incorporate sustainable practices into your current investment properties.
Adaptive Reuse and Mixed-Use Developments
Following the sustainability trend, the concept of adaptive reuse—converting old buildings into new, functional spaces, and mixed-use developments–those that combine residential, commercial, and recreational spaces—continue to gain traction. Increasingly popular in Georgia these approaches are seen as ways to revitalize urban areas, making them more vibrant and economically resilient by creating live-work-play environments. Atlas has extensive experience leasing mixed use development spaces here in Athens and is currently the exclusive listing broker for the Shoppes at
Rambler Athens.
Increased Investment in Secondary Markets
While major cities like Atlanta remain key hubs, there is growing interest in secondary markets across Georgia. Areas such as Athens, Augusta, Macon, and Columbus are attracting attention from investors due to their lower costs and potential for high returns. These markets offer opportunities for diversification and are seen as promising areas for future growth. A prime example of this trend is our recent transaction at
4304 Sudan Rd. in Augusta.
Retail Resilience and Adaptation
The retail sector is showing resilience, with grocery stores and essential services remaining strong performers. Kroger has made significant investments in the region, with a $1.7 million renovation of its store off Alps Road and a $36 million project to replace the store on Barnett Shoals Road. These investments not only provide local employment opportunities, they create investment opportunities as well. Atlas can help investors capitalize on local economic trends, such as this one.
Conclusion
The commercial real estate market in Georgia is evolving, and investors looking to diversify and expand their portfolios can still find opportunities. Atlas Real Estate Advisors is well-positioned to help investors navigate these trends, offering strategic insights and comprehensive services to maximize their investment portfolios.
