Marcus & Millichap

Atlanta Retail Market Report

Atlanta Metro Area, Third Quarter 2017

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Unwavering Employment Growth Supports Atlanta’s Development Spike

Stout retail demand fuels robust absorption as population growth boosts consumer spending. The addition of more than 350,000 jobs over the past four years has reduced metro unemployment to a 10-year low and fueled population expansion, with Atlanta’s populace swelling by more than 100,000 residents over the past 12 months. Corporate expansions by financial, technological, healthcare and retail-related companies will sustain strong in-migration and rental development, underpinning demand for retail space. As retailers scramble for space, vacancy will reach a cycle-low level, supporting a second consecutive year of rent growth following a span of nominal increases preceded by asking rate depreciation.

Peaking residential spurs retail deliveries. The creation of new households in the Atlanta metro will nearly double the national pace and a high percentage of these households are in the suburbs. To keep pace with rising demand for stores and restaurants, retail construction will heighten this year. Grocery-anchored centers will account for a portion of the larger-scale completions as Kroger, Sprouts, Publix and Whole Foods all expand their footprints. Dollar General is also in expansion mode, opening six stores.

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