All the Right Pieces: Assembling Atlanta’s real estate success
...Healthy numbers in corporate development create an urge to return to the city. Urban development is ramping up as developers realize a growing segment of the population does not want a house in the suburbs. “Atlanta has become a vibrant business hub and as a result has attracted a very diverse—in age and culture—workforce,” says Nancy Miller 88WEMBA, president of the national net lease investment group at Bull Realty. She also cites the climate and close proximity to major transportation as big selling points for the city.
Atlanta paces ahead of the national average in overall population growth, boasting a 2.2 percent increase from 2016–17 against a 0.8 percent increase nationally. Metro Atlanta is one of just 11 major metropolitan areas growing at a pace of more than 1,000 persons per week.
“There’s a national trend of people moving back into cities. They want to be close to where they work,” says Rob Brawner 06MBA, executive director of the Atlanta BeltLine Partnership. “They want to spend less time in their cars. They want to be able to connect with their neighbors, not just pull into a garage and not interact with others in their community. It’s all driving the move back to cities, and cities have to build the infrastructure to support that.”
Of course, younger professionals are attracted to the city. Atlanta is a hot spot for millennials, and over the past five years, the city’s millennial population has grown 12.3 percent. The national average is just 2.6 percent.
Atlanta’s growth also comes while maintaining affordability.
In the past five years, the city has lagged slightly behind the national average in disposable income increases (3.2 to 4.2 percent), but it remains attractive to home buyers. The median home price of $190,937 is well below the national average of $243,425, according to a trend report from PricewaterhouseCoopers.
“We have matured as a real estate community. For many years, Atlantans didn’t live in high-rise buildings of any type,” notes A. J. Robinson 77BBA, president of Central Atlanta Progress, a private, nonprofit corporation that strives to create a robust economic climate for Downtown Atlanta. “You had office buildings, but most things were three- to four-story apartments or condos, and now we’re getting to be like most cities, where people live way up in the air. And we’re building high-rise towers as residential. We’re sprouting up everywhere. And that’s dramatic.”
For instance, in February 2016, Post Properties broke ground on a $96 million, 438-unit apartment building called Post Centennial Park in Downtown Atlanta. The design features luxury, walkability, easy access to transit, and greenspace—all elements in demand for today’s workers.
“What’s happened is the next generation of the American workforce is now in the position to make decisions, and they’re saying, ‘No, we don’t want to drive to the next stop on the highway,’” says Jim Irwin 07MBA, president of New City LLC. “We don’t want to battle two hours of traffic a day to go back and forth from work.”
“Millennials are very big into low maintenance,” adds Aty Biswese 14WEMBA, managing director of Third Story Capital in Washington, DC. “They’re always on the move, so they want homes that are low maintenance.”