For half a decade, the Southeast region has seen the greatest population growth in the United States (Miami ^1.6%, Charlotte ^2.5%). “Perhaps the primary driver of real estate prices is population. The more people there are in a city, the more demand for goods, services, and property” said Keith Knutsson of Integrale Advisors. The population growth can be attributed to a more desirable, warm weather environment combined with the aspect of affordable living. What could be better?
From a business perspective, the Southeast region has been attracting a variety of media and technology companies to their commercial business districts. With a low cost of living, great infrastructure, advanced manufacturing, and competitive labor costs, the region will continue to grow at a steady pace. Here is a look at the top five cities for development in the Southeast region.
Top 5 Cities for Development
1. Charlotte, NC
Charlotte is home to 2.4 million residents. It is also the largest metro area in North Carolina with the primary driver of economic development being the successful financial sector. Charlotte is the largest banking center in the nation second to NYC. Businesses from across the nation are moving to Charlotte, attracted by a highly educated workforce, low cost of living, a business-friendly climate and the presence centralized airport. New office and industrial construction in Charlotte have not been able to keep up with population increases, causing a shortage of property and rising rates. The following has paved the way for economic expansion.
2. Tampa, FL
The Tampa Bay is Located on Florida’s Gulf Coast. The area includes Hernando, Hillsborough, Pasco and Pinellas counties, and is home to Port Tampa Bay, which helped shape the area as a hub for logistics. This region of the Southeast is filled with active defense, security, and financial industries. Approximately 10 percent of the nation’s Fortune 50 shared-services operations are based out of Tampa.
Growth in population and employment is putting pressure on wages and resulting in strong economic growth. Tampa has seen an average 2.1 percent annual growth in employment. Demand for commercial properties has also accelerated in recent years, with sales volume reaching nearly $6.3 billion in 2015. Tampa is a booming market with competitively priced assets and opportunities to generate a high yield.
3. Atlanta, GA
Atlanta has been adding new jobs faster than the rest of the nation, driving up demand for multifamily properties and once again instilling confidence in the market. The main reason for the strong rent and property growth is the imbalance of supply and demand. Atlanta’s strong multifamily structures are attracting more domestic and foreign investment. In 2015, Atlanta realized the highest overall return among major apartment markets, with an annual average return of 20.5 %, almost 900 basis points above the U.S. average.
4. Miami, FL
Miami has more than 6 million residents and is the state’s largest consumer market. The population is projected to grow by 1.2 percent in the coming years. Financial services, Logistics, and Tourism will continue to drive economic growth, with average job growth of 1.7 percent per year. Strong investment demands resulted in more than 2.4 million sq. ft. of industrial space currently under development. Growth in population, jobs, incomes, and tourism boosted Miami’s retail sales by 34 percent between 2010 and 2015. Tourism spending increased by 18% as a record 15.5 million people visited Miami in 2015.
5. Nashville, TN
Nashville is one of the fastest growing markets in the nation. Steady job growth, new construction, and strong interest from investors have made the music hub a real estate jewel. The reputation of Nashville recognizes the city as a great place to live, work, eat, and play. Over the last 10 years, Nashville has experienced record-setting levels of development. The cities’ quality of life, affordable prices, and great urban culture are attracting businesses and families. In addition, the city serves as a major logistics hub, located near other major cities such as Memphis, Birmingham, Louisville, and Charlotte.