ATLANTA MARKET OVERVIEW AND TRENDS ANALYSIS

Transcription

1 ATLANTA MARKET OVERVIEW AND TRENDS ANALYSIS SEPTEMBER 17

2 DEVELOPMENT PIPELINE - ACWORTH N. FULTON Wrap units Garden - 1,0 units ROSWELL ALPHARETTA NORTH FULTON 19 1 MARIETTA SANDY SPRINGS 400 PERIMETER Wrap - 2,481 units 278 DOUGLASVILLE POWDER SPRINGS 78 CUMBERLAND Wrap - 1,386 units Garden units MABLETON SMYRNA CUMBERLAND (COBB COUNTY) BUCKHEAD Tower - 3,805 units Midrise - 1,228 units 75 WEST MIDTOWN W. MIDTOWN Wrap units MIDTOWN Tower - 5,460 units Midrise - 1,165 units 41 ATLANTA PERIMETER BUCKHEAD BUCKHEAD MIDTOWN OLD FOURTH WARD GRANT PARK GLENWOOD PARK DOWNTOWN BROOKHAVEN LINDBERGH Wrap units 236 EMORY/ CDC 410 EMORY/ DECATUR INMAN PARK EAST SIDE 154 Tower - 7 units Wrap units CAMBELLTON UNION CITY MORROW

3 MAJOR BUSINESS DISTRICTS HOSCHTON 211 JOHNS CREEK AUBURN WINDER 29 RUSSELL GWINNETT COUNTY LAWRENCEVILLE GWINNETT Garden - 2,272 units BETHLEHEM 29 GRAYSON 81 SNELLVILLE 8 OUTER BURBS Garden - 3,306 units LOGANVILLE STONE MOUNTAIN EMORY/DECATUR Wrap - 1,754 units 78 MONROE LITHONIA JERSEY SOCIAL CIRCLE 155 COVINGTON ATLANTA MARKET OVERVIEW AND TRENDS ANALYSIS 9

4 PERIMETER OFFICE MARKET GROWTH With more than 29 million square feet of office space (21 million SF of which is class A), and more than 132,000 workers, the Perimeter is one of the largest office markets in the Southeast. Perimeter s central location, access to affluent bedroom communities as well as rental housing, and public transportation on MARTA, enables the area to continue to be the region s biggest beneficiary of Fortune 500 employers. Notable corporate relocations and expansions include heavy-hitters such as State Farm, Mercedes Benz, Cox Communications and UPS. The area is also recognized as a top national location for technology companies, from information security to financial transaction processing, with access to a highly-educated workforce and the transportation infrastructure available to get those employees to their jobs. Multiple corporate and technology firms continue to look at metro Atlanta (and Perimeter, specifically), as a home base for their long term growth plans. After absorbing the most office space of any other Atlanta submarket in both 15 and 16, Perimeter s class A vacancy at the end of Q2 17 was 11.9%, one of the lowest vacancy rates among Atlanta s major business districts. Office rents in the class A space averaged $29.58 PSF, up 3.9% from Q1 (the best quarterly growth among all of the Atlanta business districts). UNDER CONSTRUCTION: State Farm (caption 1; more detailed analysis in the Case Study on the next page), has ignited a flurry of additional development activity in the Perimeter submarket. To answer the demand for new space, developers continue to work on plans for previously-zoned properties that will enable construction of millions of square feet of new office space, hotels, shops and restaurants in the Perimeter area. High-profile development projects under construction or in the pipeline include: 01 UNDER CONSTRUCTION: Mercedes Benz US HQ (caption 2). Moving from Montvale, New Jersey, Mercedes Benz is investing $100 million in a 225,000-square-foot, build-to-suit headquarters in Sandy Springs (2.3 miles northwest of Aspire Perimeter). The German auto-maker has already brought about 800 corporate jobs and global cachet to the Perimeter submarket, leasing space in the Sterling Pointe building. An additional 150 employees will be added to the mix in the new campus, which is set to open in PLANNING: 100 Northpark (caption 3). Overlooking GA 400, 100 Northpark will be located in the square created by Abernathy Road to the north, Peachtree Dunwoody Road to the east, Mt. Vernon Highway to the south and GA 400 to the west. Developer Hines is planning 1.5 million SF of office space, 150,000 SF of retail, 500 potential apartments, and a 250-room hotel. Still in planning, 100 Northpark would deliver in 19. PLANNING: Abernathy 400 (caption 4). Ackerman and Company and H.J. Russell & Co. have formed a JV with Cousins to build Abernathy 400. This mixed use facility, located at the intersection of Abernathy Road and GA 400, would include 550,000 square feet of office space (in either one large high rise building or two smaller mid-rises (as pictured), with plans for 30,000 SF of retail and a 400-room hotel as well. The site already includes the Serrano condominiums. 03 Additional construction projects still in planning include Hines 484K SF 700 Northpark (caption 5), Seven Oaks 4004 & 9009 Perimeter Summit buildings (caption 6; both with 350K+ SF), Trammell Crow s Nexus (a 355K SF tower across from the State Farm campus), and GID s High Street project (caption 7) - a 42-acre, mixed use project that would include 8M SF of mixed-use space, 400K SF retail, 1M SF of office, 3,000 residential units and 750 hotel rooms. High Street is one of the sites that could house the potential Amazon HQ2, and is located across Hammond Drive from State Farm s new campus, along Perimeter Center Parkway

5 RECENT JOB ADDITIONS - THE STATE FARM CASE STUDY In 13, State Farm - the country s number 3 property and casualty insurance company - sought to establish three regional hubs in three different time zones throughout the country to help attract and retain the next generation of its workforce. State Farm wanted to consolidate as many as 8,000 employees in each hub, and sought locations convenient to public transportation, restaurants, shops, housing, hotels and good school districts. State Farm chose the Perimeter submarket of Atlanta for its proximity to the MARTA rail line, its plethora of walkable amenities, the deep and well-educated labor pool, and the availability of single family housing and apartments nearby. Once Perimeter was picked as one of the regional hubs, State Farm began moving thousands of staffers into several office buildings in the Perimeter area in anticipation of the new HQ. In February 14, State Farm and developer KDC unveiled plans for the new complex near Perimeter Mall. The project ranks among the largest real estate developments ever conceived in metro Atlanta s history. KDC has built-out 17 acres along Hammond Drive near the Dunwoody MARTA station (1.3 miles northeast of Aspire Perimeter). The site will ultimately include 100,000 square feet of street-level restaurants and shops, multiple office towers and a 0-room hotel. The centerpiece tower (which topped out in December 16), is a 2.2 million square-foot building that will rival the sprawling Concourse office complex with its iconic King and Queen buildings in terms of total office space. The centerpiece State Farm building (Phase I), is a 21-story tower situated at the southeastern intersection of Hammond Drive and Perimeter Center Parkway - connecting directly to the Dunwoody MARTA station. State Farm is hiring an additional 3,000 new employees to fill this new space, joining the roughly 7,000 employees already in Perimeter. The grand total of approximately 10,000 employees are expected to be in place by 18; consolidating from the existing regional offices in Atlanta, as well as from Phoenix and Dallas. The 22-story Phase II building is under construction and will add an additional 670,000 square feet. Building 3 will be 18-stories and will add 440,000 square feet. State Farm s bet on Perimeter and the additional activity within this submarket was the catalyst for most - if not all of - the development projects discussed previously. ATLANTA MARKET OVERVIEW AND TRENDS ANALYSIS 13

6 ATLANTA MARKET OVERVIEW AND TRENDS ANALYSIS 25

7 MORAN & CO SOUTHEAST SEAN P. HENRY - MANAGING PARTNER- SOUTHEAST REGION Sean is responsible for managing all marketing assignments and client relationships in the Southeastern Region. Sean and his team are based in Atlanta and will cover assignments from the Carolina s to Florida. Sean has a strong record of accomplishment in the commercial real estate industry dating back to His background includes appraisal, acquisitions, dispositions and brokerage. As an acquisitions officer for both Lend Lease and General Investment and Development Company, Sean was responsible for sourcing, negotiating, managing due diligence and ultimately closing $1.5 Billion in multifamily acquisitions in states. Prior to joining Moran & Company, Sean was a multifamily broker for ARA for 10 years. During his tenure at ARA, Sean successfully closed $6 Billion in multifamily transactions with many of the top public and private pension plans, REITs, private capital and commingled discretionary funds. For the past years, Sean has been focused exclusively on the multifamily transaction business. Sean graduated from Georgia Southern University in 1990 with a, B.B.A. in Finance. He has been an active participant in the Urban Land Institute (ULI) and the National Multi Housing Council (NMHC). CURTIS W. WALKER - PARTNER - SOUTHEAST REGION Curtis Walker is a Partner in the Southeast office and is responsible for brokerage activities in that region s major MSA s, including Atlanta, Charlotte, Raleigh, Nashville, Charleston, Birmingham, Mobile, Orlando, Tampa and Jacksonville. Prior to joining the Moran team, Curtis was in charge of all acquisition activities for the Eastern Region of Wood Partners, where he directed the acquisition of approximately $750 million of multifamily investments. Prior to joining Wood Partners, he was the Senior Vice President of Trammell Crow Company, handling the development of multifamily in the Southeastern region. Over his 24 years of multifamily experience, Curtis has been involved with more than $4 billion in transactions including 40,000+ multifamily units. Curtis graduated from University of North Texas in 1980 with a B.B.A. He is an active participant in the National Multi Housing Council (NMHC) and Apartment Life. JOEL K. SASSER DIRECTOR SOUTHEAST REGION Joel joined Moran & Company as a Director in the Southeast office in June 13, where he is assisting with the expansion of Moran s brokerage operations in this important region of the country. Joel s extensive real estate experience encompasses more than $3 billion in the development, construction and disposition of class A multifamily projects throughout the Southeast and Texas. In his previous role with The Worthing Companies, Joel was responsible for the origination of new developments, market and financial analysis, and other development-related activities including pre-construction, design specification, zoning, entitlement procurement and pre-construction marketing. His specific areas of market expertise include Atlanta, Raleigh-Durham, Houston, Austin, Nashville and Charleston. Prior to his role as Development Director, Joel was the Regional Operations Manager for Worthing, responsible for procuring new fee management assignments and overseeing due diligence and property takeovers. Joel is a 1999 graduate of the University of North Carolina at Chapel Hill, with a B.A. in Journalism and Mass Communication. Joel is a Certified Commercial Investment Member (CCIM). 26

8 MORAN & CO. NATIONAL RESOURCES The partners at Moran & Company are a unique set of very skilled real estate professionals, each of whom has worked at the highest levels of the principal side of the multifamily industry. This group s collective experience in disposition, capitalization and advisory services provides a deep understanding of the needs of both sellers and buyers of core-quality real estate. The multifamily industry recognizes Moran & Company s unparalleled client advocacy and wisdom, and frequently calls upon Moran & Company for industry leadership. The National Multifamily Housing Council and Mortgage Bankers Association rely upon Tom Moran to frequently testify before Congress on behalf of the NMHC PAC, and to represent the interests of the entire multifamily industry. Mary Ann King is a former Chairman of the NMHC and current Urban Land Institute Trustee. Additional Moran & Company partners are also represented on not one, but three ULI leadership councils. These industry leadership roles provide all of the partners at Moran & Company with direct access to the top decision-makers in the multifamily space. THOMAS F. MORAN - MANAGING PARTNER Thomas F. Moran is Moran & Company s Managing Partner. He assists in structuring all joint venture and pre-sale opportunities marketed by Moran & Company as well as in the client contact for all major assignments. Tom received a BS from Marquette University in 1959 and a law degree from Georgetown University in Between 1963 and 1969, he worked for Arthur Andersen in Chicago as a member of the tax staff. From , he served as a tax manager. In 1969, Tom left Arthur Andersen to work for Walston & Company as an investment banker. There he worked in the Corporate Finance area specializing in the analysis of oil and gas, cattle feeding, and real estate. In 1971, Tom left Walston & Company to form his own firm, Moran & Company. Tom received his C.P.A. from the State of Illinois in 1967 and passed the Illinois Bar in He sits on the Executive Board of the National Multifamily Housing Council. He is a member of the Illinois Bar Association and the American Institute of Certified Public Accountants. He is a licensed broker in Illinois, California, Kansas, Minnesota, Tennessee, Texas, and Georgia. MARY ANN KING - MANAGING PARTNER - WEST COAST REGION Mary Ann King is President of Moran & Company and is based in Moran & Company s West Coast office. Mary Ann received a BA in Urban Studies in 1975 from Middlebury College in Middlebury, Vermont. She received a Masters Degree in City and Regional Planning with a specialization in Housing Development from Harvard University in Cambridge, Massachusetts in 1977 and a Masters of Management (MBA) with a major in Finance from Northwestern University in Evanston, Illinois in From , she worked in the Real Estate Department of Continental Bank. She was made an officer in 1979, an AVP in 1981 and a VP in From , she had responsibility for managing a team of lenders involved in underwriting condominium conversion loans nationwide. In 1983, Mary Ann joined Moran & Company in Chicago as its Vice President of Acquisitions and Finance. From , she was responsible for identifying and financing joint venture development opportunities for Moran & Company s investor clientele. In 1994, in response to demand from Moran & Company s institutional clientele, Ms. King, became licensed as a broker and sold the first property ever listed by Moran & Company s newly formed brokerage division. Mary Ann was instrumental in managing the underwriting and developing the collateral materials that have given Moran & Company its unsurpassed reputation in the sale of institutional quality apartment properties nationwide. Mary Ann is the Vice Chairman of the National Multi Housing Council and a member of its Executive Committee. She is also the Vice Chair at large for the Urban Land Institute s blue Multifamily Council. ATLANTA MARKET OVERVIEW AND TRENDS ANALYSIS 27

9 SOUTHEAST 3414 Peachtree Road NE, Suite 475 Atlanta, GA Phone ATLANTA CHICAGO DALLAS DENVER HOUSTON IRVINE PHOENIX SEATTLE WASHINGTON DC