Newspaper article THE JOURNAL RECORD

Atlanta Olympics Lift Real Estate Market

Newspaper article THE JOURNAL RECORD

Atlanta Olympics Lift Real Estate Market

Article excerpt

ATLANTA _ With the city as host of the 1996 Olympic Games, Atlanta's commercial real estate market has surged.

Even with large construction projects directly and indirectly related to the Olympic Games, prime office and industrial space is at a premium and could become even more difficult to find as the summer of 1996 approaches, the city's business and real estate leaders say.

From a high of 20 percent in the fourth quarter of 1992, the vacancy rate for office space in metropolitan Atlanta had fallen to 13 percent by the end of September, according to Jamison Research Inc., an Atlanta-based commercial real estate research company.

The vacancy rate for class A, or prime, office space was estimated at 10 percent and falling.

Outside the central business district, only 2.28 million square feet was available from a total inventory of 31.26 million square feet, for a vacancy rate of 7.3 percent, Jamison reported.

Since the beginning of the year, average rents in the hottest submarkets have jumped an average of $3 to $4 a square foot, to $20 to $23 a square foot, the company said.

As the Olympics approach, there is renewed interest in downtown space as well. This is reflected in the declining vacancy rate, from 30 percent in 1992, when three major office towers were completed, to about 16.5 percent at the end of the third quarter.

"We do not have large contiguous amounts of office space to offer companies wanting to move to downtown or any other part of this region," said Gerald L. Bartels, president of the Atlanta Chamber of Commerce, at a news conference last month called to discuss Atlanta's real estate boom.

International interest in Atlanta is behind much of the commercial real estate growth. Last month, Atlanta-based ISES Properties announced a $180 million hotel, retail and commercial development in downtown Atlanta anchored by a $50 million, 318-unit Holiday Inn Crowne Plaza hotel financed primarily by investors from Hong Kong.

A survey last month of members of the Association of Foreign Investors in U.S. Real Estate, representing approximately half of all foreign real estate investment, named Atlanta as "the most viable city for foreign real estate investment."

In that survey, Atlanta leapfrogged Washington and New York, which had finished first and second, respectively, ahead of Atlanta, last year.

Along with the city's general economy, the Olympics designation lures investors, according to Jim Fetgatter, chief executive of the association. …

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