Most people think of riverboats and River Street when they think of Savannah, Georgia, but developers working on the Georgia International Trade Center are thinking of something a whole lot bigger than green beer on St. Patrick’s Day earlier this year: 3,000 jobs, more than 7 million square feet of desperately needed industrial and warehouse space, and “an enormous economic impact for Effingham County, Georgia, and the entire Savannah region,” as vice president of development at Chesterfield Chance Raehn described it.
Raehn’s company, which is based in Winter Park, Florida, and Atlanta-based Stonemont Financial Group have teamed up to build the 1,150-acre industrial park near Savannah, Georgia, to take advantage of the proximity to the Georgia Ports Authority’s Garden City Terminal, the area’s ideal intersection of interstates, and railway corridors. At present, local analysts estimate warehouse vacancies are less than one percent in many cases, so the new development will likely attract multiple tenants nearly immediately, thereby delivering on those projected jobs and the associated economic boost they will provide the area.
Where Will these New Residents Live?
Savannah is known for its quiet streets, historic homes, and Spanish moss-draped trees. In fact, that peaceful imagery is one of the main reasons the city ranked on Forbes’ “Top 25 Places to Retire in 2019” list. The other reason is far more practical likely played a significant role in the decision-making process when developers were considering where to locate their new industrial park: Savannah, Georgia, housing is highly affordable, scoring an 88 on the U.S. Bureau of Labor Statistics’ cost of living index. On the index, scores lower than 100 indicate a lower cost of living than the national average while score over 100 indicate a higher cost of living than the national average.
Savannah, in addition to being generally affordable, has also recently experienced a multifamily residential renaissance of sorts. A growing population of renters in an area where, historically, most renters were students, have attracted a plethora of landlords offering both single- and multifamily rental housing options as well as nationally known property management companies and developers eager to provide new residential options for tenants who have living preference different from those of traditional students.
In fact, the Savannah residential rental market currently boasts about 20,000 existing units and another 2,737 under construction. Another nearly 2,000 are presently in the planning and approval process and will cater to older residents, out of college and employed in venues such local industrial parks or retired and working part-time, who wish to live in relatively close proximity to Savannah’s attractive downtown area.
“For so many years, everyone was pushed out…to the south side [of Savannah], but what we’re trying to do is…bring people to Savannah,” explained marketing director for Kole Management Company Katie Davis. Kole manages about 2,500 units in Savannah, Macon, and Augusta, and Davis predicted a new population of renters will soon emerge in the Savannah area that will eventually evolve into a new generation of buyers.
“Certain folks will be aging into the rental market as they start careers and things like that,” she explained. “You’re more likely to see people in the rental market [right now] as opposed to home ownership that takes a few more years,” she added. Kole recently launched a boutique development catering to residents that offer “diversity” to the area, Davis concluded. She said, “It’s really good to see the embracing of the diversity that is downtown Savannah because before it would be the very wealthy living in beautiful homes and then students living in dorms.”
The end is certainly not in sight for investors hoping to place capital in the Savannah area. Michael Toma, head of the Center for Business Analytics and Economic Research at Georgia Southern University, believes the simple laws of supply and demand will keep the demand for housing in the Savannah area up. “The market will continue to be attractive … as long as the vacancy rates remain attractive,” he observed, noting that properties near desirable locations like dining and entertainment venues, multifamily properties with lots of amenities like fire pits and wellness centers, and areas with strong community all are particularly attractive.