Box 14, Folder 3, Document 8

{National Real Estate. Investor, Nov. 1964 issue)
Atlanta is unique in that: both thé “:. «parks, many of- which have ‘been pro-

-; guarantee mortgages to $30,000 per
, unit, up from, $25,000. Under condo-
* mjnium, individual: mortgages are writ-

- tensfor cach apartment, instead. of a

blanket mortgage on the ete as
- with cooperatives. °

-Demand. continues’. brisk for: the
- FHA-insured condominiums, but the

-Mmarket Sscems surfcited ‘with luxury -

-» cofidominiums. Despite the high ‘num-

.. ber of vacancies, however, new luxury

‘condominiums continue to be built.
‘The paradox of the new condo-

.minium apartment -building that rises
and |

. alongside another recently built,
- partly empty. apartment house, has its

_ explanation: Promoters have Jarge sums’
of money invested in the property, and °
“as long as they. can obtain bank financ- .
‘.ing, prefer to push ahead in the face:
. Of a weak market rather than see ‘their. .,
- funds idling in unused land. Then, if ..

customers are not:found promptly to

buy the condominium apartments, some.

of the units can be rented convention-
ally: A condominium ‘apartment that

sells for $40,000: can bring $300 or

better in monthly rental.
. Moreover, some

a building directly for. apartment rental.

Ot
~...No Lag in Atlanta's’
Realty Market Indicated

Atlanta, Ga, — As‘a realty market,’

* Ailanta is indicating no lag in continu-
ing progressive operations. .Thomas V.

Cauble, president of the Atlanta Real -

-’ Estate Board and vice: president of the
’ ..Adams-Cates Company, ‘reviews the
property categories here in this manner:

Office buildings: A survey made late
last year involving 40 buildings in
‘Atlanta which have combined rentable
‘, areas totalling 5,134,000. sq. ft., re-
vealed 187,000 sq. ft. was: at that date

/” ‘vacant. The occupancy ratio was there-
' < fore, 96.3%, These 40 buildings were

‘located downtown and in semi-central
(Pershing Point) and, suburban areas
(Lenox Square). Also included were
~ five medical buildings.
“Rental rates for’ new downtown space
on average $4.50 per:sq. ft., and for new
... suburban space about’ $3.50 per sq. ft.
4 Older buildings downtown would aver-
.age about 25% Jess.-There would be
~, little difference in semi-central or sub-
“;, Urban buildings, since-all are relatively
ew. Rental rates are about the same as
last year,
- There is proposed, or under con-
‘ -struction, approximately three million
"sq. ft. of new office’ space, _approxi-

mately two-thirds of which is down-.

- town. Since most of this ‘is institution-

*. ally-owned, -we feel it will. be absorbed
-. Readily as it is completed over the next
Ff two to three years. «

~ +. The,only concessions made in office

: building leasing involve. assuming the.
i ‘remaining portion of an existing lease _
'.. ip order to get @ desirable tenant in a

' Jarge area, Land and construction costs

OS Have increased -approximsiely 5% to

ae since. bis ae

. developers are,"

- during. 1962
~ City Building Inspector -William - ROY

_the metropolitan area at 3.5%.
carriers from Atlanta: and nine ube fa
urban cities participated in the survey, -

ee a

, downtown and suburban arcas have...
“continued to grow about equally.

Apartment Houses: Atlanta has
shown a remarkable ability to absorb’.
garden-type apartment units, where the *:

"vacancy rate at this time. is about 7%.
‘High-rise apartments have not ‘done so_

* well. The vacancy rate there would run, a
12% to 15%. The difficulty appar-.. “i

ently lies in the fact that a garden-type
unit can provide the same accommo-.

% dations at about 25% less rent. There-.;

has been from time to time evidence ‘of
rent concessions, but the practice is, mot =

wide-spread and the concessions are not «:

substantial.
The rate of construction -is about’ the

same as last year, and land and con-". '
- struction. costs have increased 5% to 4“

10%. The suburban market ‘has done .’

better than the downtown market, pri-.:"".
* marily because most of the garden-type:s i ional value, i he
--units are Suburban, oy

The first nine months. of 1963 Eh

seen the attainment of a new all-time «
' high record for city building permits...:;

The previous high record was for, the
entire year of 1962. Through Septem-
Ixs 30, the city issued. building permits
valued at- $127,903,326. Permits issued
totaled. $116,648,338.

Wofford said he expects the city to hit,

: $150 million by the end of 1964. The--
permits represented a cross section of...

all categories of building, Mr. Wofford

‘said, and indicated an increase over: ;:-
_ Previous years in all categories. Pry
Overall, the Federal Housing Admin= «i:

istration here estimates. the eS

rate for apartments and: residences -in
Postal «

visiting a total of 277,880 residences ..

and apartments in the five-county area.(.) :

They found that of the residences— :

208,185—some 5,241 were vacant, for. .

a percentage rate of 2.5 Apartment:
vacancies were 4,389 of a total of 69,+

‘695 units, for a vacancy rate of 6.5%.

Within the Atlanta’ city. limits: the

overall vacancy rate was 3.3%. ‘That.’:
included a 6.1% vacancy ‘rate: for’ %

apartments and a 2%. vacancy fate: for. :
residences. John F. '‘Thigpen,. director:
of the Atlanta FHA office, said : the
survey confirms earlier evidence that.’
there is no requirement for additional *.
high-rise apartments in Atlanta.

Shopping Centers: There are three
‘major centers, totaling roughly 1, ,400,-

000 sq. ft., now under construction
They. are Columbia Mall (Sears. and

Macy),. North DeKalb (Rich’s)’ and“.

Greenbriar (Rich’s and Penney). There
are very few vacancies in existing cén--
ters, and small centers are now being :
built only in outlying areas. The trend *
for several years has. been to large -
centers (400,000, sq. ft. or more) built.”

around one or two major. department : *

stores, « 4,
Industrial Properties: “Most of; bur.

incasisel growth for te pabt 10-year ‘
"Planned ; industtial -!

fs ‘run about

_moted by railroads. Most of the growth
‘sat this time is taking. place in -such

aa ~ parks located along the city’s cxpress-
:eway system, A new devclopment has

been the trend from combined office-
‘and-warchouse space to 100% office -
space. Such a development is already
underway on the Northeast Expressway.
‘It is called Executive Park and involves
“about 115 acres. |

The vacancy rate in modern ce “story |

& “industrial property is negligible. The

;, vacancy it old loft-type buildings would ..
15%. Many “have been’
‘demolished in connection with: urban
redevelopment, expressway, condemna-

“tion and to create parking. The going

‘rate .for modern ‘l-story, Warehouses -

would run 60-75 cents per $q. ft., but

ranging upwards to $1 per'sq: ft. for
“expressway locations having.'s a. good



=





- Vacancies Rise in

Apartments, Offices |





” Washington, pic Apitinent va- |

cancies rose from 1.59% a year ago to

1.88% this summer, This is:on build-. -

“: ings that were once nearly completely «..”
.- occupied.’ It does not include the new
-: buildings. A truer rate is more near

%.

'. buildings just on -the market.. :
‘ The supply. of ‘new office buildings

ds considerably beyond the demand in ©
. Washington. Some buildings are break-
< ing along established $5.75-$6 a sq. ft.
‘yprice. Most of-these-are in the outlying

areas, but even buildings with choice oS

*locations are feeling the pressure and

* are dropping’ rents to. $5.25-$5.75 a
, sq. ft.

There ‘are approximately |15 office
buildings now under-‘construction in
the northwest section of the city, the

** private industry area, with hine build- "*-

dongs planned,
New offices .are renting ‘at, $5-6 a-

«foot; older space at $3-4. Suburban

-,buildings rent for about 15% lower
‘than downtown space and there are

“more vacancies in suburbia,

Concessions include the’ following:

‘Temodeling cost is, borne to keep ten.
ants; new interiors given to. new ones;
“paying moving expenses; some buying ;
-Of leases to' get tenants; | carpeting,

“drapes offered; even six “months free

_ occupancy in some cases,

Uncle Sam is ‘not. taking much new

_ "space this year; he’s expected. back in

-the market big in 1965.-Construction
starts on offices have tailed off; many
are planned. More of a swing to down-

town apartment complexes,

ction costs are - up only

slightly; mortgage ; market’; poonew tat

“better oe Ge tt



_ The 96.8% office building occupancy ae
‘crate is the lowest since 1960. Overall | —
office space vacancy is probably more |
like 8% now, including the many new °-