Downtown business owners try to keep smiling amid pandemic - 1736 Magazine, Summer 2020

DOWNTOWN LIVING continued from 17
Much like other recent high-density developments
in the city center, such as the recently
opened Beacon Station on Wrightsboro Road
and The Clubhouse at North Augusta’s Riverside
Village neighborhood, Millhouse Station
is aiming to be a magnet for upwardly mobile
millennials seeking an urban lifestyle.
GROWING DEMAND
The expansion of Fort Gordon’s electronic
warfare mission during the past several years
appears to have stoked such demand. The
Department of Defense announced in late 2013
that Army Cyber Command – and the roughly
5,000 active duty and civilian employees it
supports – would move to Augusta from Fort
Belvoir, Virginia, by 2020.
According to a residential real estate study
conducted during the spring for the Augusta
Downtown Development Authority, more than
675 rental units have been created in the urban
core since 2014. That figure doesn’t include the
155 future units at Millhouse Station.
The annualized rate of construction during
the six-year period, 112 units, is more than
twice the historical rate of 50.
“There has been a steady demand for
apartments in downtown and I think that will
continue,” said Jane Ellis an authority board
member and a real estate agent with Sherman
& Hemstreet, which conducted the market
survey. “There are sufficient jobs in cyber
and medical, and there is a growing student
population.”
The study included the historic Harrisburg,
Laney-Walker/Bethlehem and Olde Town
neighborhoods as well as the central business
district. The 221-unit Beacon Station complex
was the only government-assisted project in
the study.
Properties with less than four units were not
included in the study. Neither were loft apartments
over commercial buildings. However,
former commercial buildings that have been
converted entirely to multifamily use were
included.
The increased demand has caused a steady
rise in rental rates since 2014, with average
per-square-foot rates rising from just under
70 cents to $1.05. Average downtown rents,
regardless of size, have risen from $625 to
$957, an annual increase of 8.8%. The average
rate of inflation for the nation during the same
period was 1.5%.
“Rental rates have risen, which is good from
a landlord’s point of view, but rates are beginning
to stabilize,” Ellis said, noting that the
rate of growth began slowing in mid-2017.
Roughly 83.5% of all urban core rental properties
are occupied, with the average studio
apartment renting for $630 a month; one-bedroom
units for $916; two-bedroom units for
$965 and three-bedroom units for $1,728.
Downtown Augusta’s 16.5% vacancy rate is
double the national average, though the rate
has been somewhat skewed by the addition of
Beacon Station, a public-private partnership
between the city’s Housing and Community
Development Department and an Atlantabased
developer.
The $32 million project added 221 market-rate
units to urban core apartment inventory when it
began leasing in late 2019. The complex, across
the street from Augusta University’s Dental
College of Georgia, is designed to increase the
population and per-capita income in the Laney-
Walker/Bethlehem neighborhood.
Hawthorne Welcher Jr., the city’s Housing
and Community Development director, said
Beacon Station was 65% occupied as of mid-
July, with roughly 45 to 50 pre-lease agreements
in place during the next two months.
“We’re trending to be at 85% based on current
projections,” he said. “So this project is
18 | 1736magazine.com