For one reason or another, either the commercials or the football, we’re all drawn to Sunday’s big game as one of the most anticipated gridiron match-ups of the season. This year the New England Patriots will meet the Atlanta Falcons on the field at NRG Stadium in Houston, Texas.
Oddsmakers have already announced a three-point spread in favor of the New England Patriots, but commercial real estate experts at JLL evaluate more than just on-the-field stats to predict a winner. According to JLL research, Coach Bill Belichick and the Patriots will take home the team’s fifth NFL championship.
JLL’s America’s Executive Chairman and Hall of Fame Quarterback Roger Staubach said, “This is always an exciting time and it seems like yesterday when I was getting ready for the big game. The Patriots and Falcons both know how to move the football so it’s going to come down to each team’s defense and its ability to stop Brady or Ryan. Sunday will be a heck of a game, but this year I think it’s going to be the Patriots that win.”
Since the firm started making predictions based on real estate market data in 2011, JLL research has accurately predicted the winner nearly 70 percent of the time.
Beantown has more than Tom Brady
Boston currently boasts one of the strongest economies in the nation. Diverse industries such as healthcare, education, technology, finance and life sciences combine to propel job growth. In fact, over the past six years, the city has consistently tracked year-over-year job growth at a rate of 2.0 percent.
“The Patriots’ recent run of success mirrors the growth of our regional economy and real estate market. Whether every-down players or specialists, the Patriots do their jobs and do them well. Similarly, across many industries and geographies, commercial real estate investors and tenants have created a market that is consistent and strong. On Sunday, we know that the resilient Patriots will come through yet again and we are proud of their success,” said Jim Tierney, Managing Director, JLL New England region.
According to JLL research, demand for premium office space has created a competitive marketplace for landlords. In the last three months of 2016, nearly 3.0 million square feet of large office leases (over 20,000 square feet) were completed, making it one of the most active quarters on record.
What’s even more interesting is that two-thirds of the large leases were for growing companies and 40.0 percent of the overall activity in the third quarter of 2016 resulted from technology focused companies. Leasing activity remains healthy across a variety of sectors and the greater New England area is expected to continue with sustained activity.
In response, average asking rates in Greater Boston also saw a slight uptick and reached $34.00 per square foot. To put that in perspective, it means that market rents have increased by 26.5 percent since 2010.
Atlanta: First down in uncharted territory
Continued urbanization and a focus on walkability are driving renewed interest in Atlanta’s urban submarkets and pushing rents higher. The increased momentum from leasing activity and changing market dynamics has forced some companies to look to suburban alternatives. At the close of the fourth quarter in 2016, the rent differential between urban and suburban office space was $3.72 per square foot.
JLL research experts noted that average asking rates in Atlanta have increased by 15.3 percent since 2010 and are expected to climb. While a significant premium, the market still lags behind Boston. The rent gap between the two cities has increased by 42.1 percent since 2010.
Despite the fact that office statistics don’t point to a win on Sunday, the city is moving the ball across the goal line (so to speak) with two new public transportation referendums.
The T-SPLOST and MARTA expansion will benefit the entire Atlanta metro area by improving safety and functionality for pedestrians, bikers and drivers.The four-tenths of a penny sales tax increase associated with T-SPLOST is expected to raise approximately $300 million over the five-year collection period, while the additional half penny in sales tax revenue for MARTA is projected to generate $2.5 billion for transit improvements over the next 40 years.
“Atlanta is easily one of the top metro areas in both sports and commercial real estate. The city continues to improve as a top destination for corporate relocations, with four Fortune 500 headquarters moving to the city in just the past six years, and has solidified its position as a major business hub of the Southeast region. Corporations and talent are drawn to the low cost of living, low cost of doing business, high quality of life and access to Hartsfield Jackson International Airport,” said Mike Sivewright, JLL’s Atlanta Market Leader.
Sivewright continued, “The Falcons finished their final game at the Georgia Dome as NFC Champions and we are carrying that momentum all the way to the big game to beat the Patriots!”