Q4 Atlanta, GA Retail Market Report
Atlanta Market Overview
In Q4 2023, few retail markets experienced as much success as Atlanta, and tenants quickly met the demand for retail space. Due to a relatively limited development pipeline, a near-record low availability, and substantial increases in retail sales, landlords currently hold the upper hand in terms of pricing. Tenants are prepared to pay higher rents to be close to Atlanta’s growing population centers and recovering office markets where space is scarce.
Atlanta Market Performance
As of Q4 2023, Atlanta’s retail absorption has remained consistently positive for 11 consecutive quarters and ranks among the top markets nationwide for trailing 12-month net absorption, alongside other significant Sunbelt markets like Dallas-Fort Worth, Phoenix, and Houston. Over the last three years, triple-net asking rents have seen a continuous and steady increase. In the first quarters of 2023, the metro area witnessed an unprecedented acceleration in overall rent growth. Rent growth over the past 12 months is 7%, surpassing the national average of 3.3%. Only about 1.7 million square feet, representing 0.5% of its current inventory, is under construction. This aligns with the national average of 0.5% and is expected to decrease further in the short term due to a decline in construction starts throughout 2023.
Rising interest rates and general economic uncertainty have prompted the postponement of many retail deals. Total sales volume was down more than 55% in the first three quarters of the year compared to 2022. The deals that have closed included purchases for redevelopment, sale leasebacks, or large portfolio deals, often involving institutional or international buyers.
By The Numbers | Last 12 Months | Source: CoStar Group
- Vacancy Rate: 3.5%
- Rent Growth: 7%
- Deliveries SF: 1.4M
- Absorption SF: 2.2M
- Sales Volume: $2.3B
Click here to view the Q3 Atlanta Retail Market Report.
