Atlanta risen: A city cements its role as the capital of the South
Written by Tom Brady
Reviewed by Mynd Editorial Staff
Atlanta has far surpassed its unglamorous beginnings — founded in 1847 at the terminus of the Western & Atlantic rail line.
From its days as military supply hub during the Civil War, to its burning by Union troops (the backdrop of “Gone With the Wind”), to the first serving of Coca Cola in a city drugstore in 1886, to its vital role in the 1960s Civil Rights movement (Martin Luther King Jr. was born there), to hosting the Olympics in 1996, this metro area found a way to surpass older, more scenic places to lay claim to capital of the South.
Frederick Allen traced the city’s ascension to regional dominance in his book, “Atlanta Rising: The Invention of an International City 1946-1996.” Allen recounts how city and local company leaders collaborated to create a business-friendly environment.
Perhaps the city’s new vibe is best captured by the television show named after it that was created by Daniel Glover, who was raised in nearby Stone Mountain, Georgia.
“Atlanta” features Earn, a Princeton dropout played by Glover, as he tries to help his cousin Paper Boi launch his music career. Labeled an “existential comedy” by one critic, the series follows Earn and his cousin’s forays into Atlanta’s rap scene in pursuit of stardom.
The city itself serves as a backdrop for a world where success is elusive, and the reality of the struggle is unvarnished.
Those struggles and human failings belie that fact that Atlanta has made it: It’s now important enough to serve as the setting for a television series, created by one of the versatile and exciting artists working today. (Aside from writing, acting, producing and directing, Glover has a musical alter ego, Childish Gambino, who has had a number of chart-topping songs.)
It is a place that attracts ambitious young people from throughout the south. For those who left for the cities in the north and are looking to return, most are not returning to the small towns in Georgia — or Mississippi, South Carolina or Alabama — that they left.
They are choosing Atlanta, where a diverse community and a relatively progressive political atmosphere prevails.
“There is an in-migration to Atlanta from throughout the Southeast,” said David Zanaty, the head of institutional strategy at Mynd. “We have a lot of real estate refugees who are coming here and loving our cost of living.”
People flocking to Atlanta despite real estate price hikes
That cost of living is starting to edge up.
Still the people keep coming. Metro Atlanta’s population has risen by 400,000 people since 2015, according to the Census Bureau.
It added another 34,000 people in 2020 and the metro area population hit 6,013,000 in at the beginning 2022, a 1.73% increase from 2021, making Atlanta one of the fastest-growing metro areas in the country.
According to realtor.com, home prices leveled off a bit at the end of last year:
Median list price was $389,900 in December, down from $399,000 in November
Median sale prices fell from $375,000 in November to $360,000 in December.
Time on market bumped up slightly as well, from 49 days in November to 52 in December.
Median sale prices were up over 10 percent year over year, from $327,000 in December of 2020 to $360,000 in December 2021.
Rents were up in 2021 as well. While the city of Atlanta saw gains of 8.8 percent and 10 percent for one- and two-bedrooms, respectively, rents in the suburbs soared, Atlanta Agent Magazine reported.
Only about 60,000 apartment units were added to the metropolitan area since 2015, so the price hikes are a function of demand outstripping supply.
The price increases were the highest in the cities north of Atlanta — Alpharetta (18.6 percent), Duluth (17 percent), Marietta (12.8 percent), Sandy Spring (12.9 percent) and Smyrna (15.4 percent). Two-bedrooms in Duluth (20 percent), Marietta (20 percent) and Smyrna (15.4 percent) were up dramatically as well.
Job opportunities in Atlanta
The area is home to 18 companies that are on the Fortune 500 list, including Home Depot, Coca-Cola, Delta Airlines, Aflac and the United Parcel Service. Hartsfield-Jackson Atlanta International Airport was the busiest hub in the world for 20 years running, until it was dethroned last year by an airport in China.
“Atlanta became what it is because it is a hub of transportation, including rail and air,” said Zanaty. “It’s also got a lot of diversity in the economy — it’s not just oil, it’s not just tech.”
“This makes it very resilient in a downturn,” he added.
There are also 57 universities in the Atlanta region, including Historically Black Colleges and Universities such as Clark Atlanta University and Spelman and Morehouse colleges; the highly ranked private Emory University; and public institutions such as Georgia State University and the Georgia Institute of Technology.
With all the corporate activity in Atlanta, salaries are competitive. The median income in 2020, according to the federal department of Housing and Urban Development, was $82,700.
All these factors make Atlanta an attractive place for property investors.
“There are very high occupancy rates and demand is incredible,” said Mike Overley, director of single-family rentals at Mynd. More than 80 percent of the jobs that were lost during the pandemic are back, in fields as diverse as technology, services and sales, he added.
Overley worries that the city may be too popular for its own good.
“Prices are up to unhealthy levels,” he said. “Affordability is a concern. If you want to be close to town, you’re going to have to pay for it.”
But one of the city’s strong suits, according to Overley, is its ability to attract people from all over. “It’s such a melting pot here,” he said. “You see it when you go to a sporting event in town. There are people wearing jerseys from cities all over the country.”
The downsides of growth in Atlanta
Challenges for the Atlanta region include improving its transportation options, mainly by expanding the Metro Atlanta Rapid Transit Authority (MARTA), the bus and rail network that serves the area. Efforts to build more rail lines have run into local opposition in the suburbs, where most people rely on cars.
Regional planning runs into roadblocks, Zanaty said, because there is a “balkanization of jurisdictions” with metro Atlanta encompassing some 28 counties and 140 cities, give or take. Georgia has some of the smallest counties in the country.
“Getting alignment around a broad strategy is pretty hard,” he said.
One upshot of this lack of regional planning is that there is a dearth of affordable housing near the area’s job centers. And with more development — something like 33,000 housing starts a year — traffic and sprawl are ongoing concerns.
A bright spot in the Atlanta market, according to Overley, is the gentrification of the southern part of the metro area, which is divided from the north by I-20, an interstate that travels east to west. Previously, this area had issues with crime and subpar schools, both of which have seen improvements.
“The south side of Atlanta is picking up some steam,” Overley said. Meanwhile, “northwest Atlanta is going crazy with the areas that have been redeveloped.”
And with housing prices on the rise, the rental market is looking more attractive to many Atlanta transplants. Since the city has no natural boundaries, like a mountain range or a coast, it will keep growing outward as new residents arrive.
“That’s one thing that Mynd is unlocking — the way that housing is consumed,” Zanaty said. “Your first home might be a rental.”
Challenges facing Atlanta and Georgia as a whole
Like many other big American cities, Atlanta is struggling with an increase in violent crime, including a 58 percent increase in homicides last year. Researchers attribute part of this nationwide trend to the strain wrought by the pandemic on at-risk urban residents, and its impact on the courts and police departments. The crime wave was cited as factoring in the decision of Mayor Keisha Lance Bottoms not to run again, which she announced in May. (She said it did not play a role).
Both challengers for the mayor’s post, Felicia Moore, the City Council president, and Sharon Gay, a lawyer, have made fighting crime central to their campaigns. (Crime levels in American cities are well below historical highs in the late 1980s and early 1990s. There were 157 homicides in Atlanta in 2020, up from 99 in 2019. Homicides peaked at 246 in 1989.)
Georgia’s new election law, signed by Governor Brian Kemp on March 25, did cause a backlash among corporate CEO’s and led Major League Baseball to relocate its All-Star game in July from Atlanta to Coors Field in Denver. Large corporations located in Atlanta, including Coca-Cola, Home Depot and Delta Airlines, offered statements in support of voting rights but initially said little about the law specifically. The law spurred a group of 72 black executives to sign a letter calling on all of corporate America to publicly and directly oppose new laws that would restrict the rights of black voters.
The law imposes new voter ID requirements for absentee ballots, empowers state officials to take over local elections boards, limits the use of ballot drop boxes and makes it a crime to approach voters in line to give them food and water.
Court challenges of the law loom, and the U.S. Justice Department has sued the state of Georgia. With an election for governor coming up in 2022, and a state that went for Democrats in both Senate races in January, the struggle over the election law is ongoing. But so far it appears that it has not directly affected Atlanta’s business friendly atmosphere.