Strategic Real Estate Partners is planning a 2.1 million-square-foot data center in Palmetto, Georgia. The project is expected to span 320 acres of land at 300 Johnson Circle in Coweta County. Developers are predicting a cost of $1 billion and believe build-out could take 15 years, finishing in 2036. The development, called Project Peach, will include eight data center buildings. The project is expected to kick off $3 million in tax revenue.

Project Peach will be located just four miles from Microsoft’s $500 million Azure data center campus. The area’s data center capacity has increased 76% since the beginning of the year. The region is slated to take the second position in the nation for data center development, following northern Virginia.

State lawmakers, leery of the amount of energy and water the facilities use, passed a law putting the brakes on future projects, but Governor Brian Kemp vetoed the legislation.

Anyone who owns property understands the irrefutable fact that insurance costs are on the rise – by a lot. To put this into numbers, the Deloitte Center for Financial Services anticipates that “the average monthly cost of insurance for a commercial building in the United States could increase from $2,726 in 2023 to $4,890 by 2030.” This represents an 8.7% compound annual growth rate.

A recent CBRE article explained that rising insurance costs don’t just impact the bottom line of CRE ownership. It can also lead to a decrease in overall property values. Specifically, “rising insurance costs have caused a 3.6% decrease in multifamily property values nationwide since Q4 2019,” the article noted. Specific multifamily value declines listed included:

• South-Central region: – 7.8%

• Jacksonville, FL: – 9.6%

At the other end of the spectrum, Oklahoma City ( – 3.8%) and West Palm Beach ( – 5.0%) had the least severe declines in property value.

The article also commented that insurance is the sixth largest expense for multifamily property owners, though it has proven to be the second-biggest contributor to total expense growth since 2019.

Even with rising insurance costs, there are some bright spots. For example, while South Florida multifamily owners have paid a substantial increase in insurance premiums, some of the impact has been mitigated due to ongoing renter demand and continued rent growth. Additionally, insurance costs are beginning to moderate – even in Florida. “Q2 2024 marked the first quarter of lower insurance cost growth across all regions since mid-2022,” the article explained.

Another factor is that improving renter demand led to higher absorption rates in Q2 2024, which outpaced new supply. The article pointed out that “the shrinking supply pipeline will eventually drive above-average rent growth in most markets.”

Something else to look forward to is that cap rates have stabilized, and when the Federal Reserve begins its interest-rate cuts, those rates will fall. “Even as expenses remain high, we expect that multifamily values in some markets will begin to surpass their previous peaks as early as mid-2027,” the article said.