Frank Norton Jr.’s annual economic update/forecast, usually a big community and social event, has gone digital this year, thanks to the ongoing COVID-19 pandemic.
And the pandemic served as an overarching theme of his Native Intelligence 2021 Forecast, which the real estate executive with Gainesville-based The Norton Agency filmed last week in front of a few Norton agents.
In talking about the area’s top economic “game changers,” this year’s top 10 list “could, if we had allowed, revolved around COVID,” Norton said.
Here’s a summary of what Norton sees as top economic issues, trends and concerns coming out of 2020:
COVID-19 ‘changed everything’
Amazon “took a giant leap forward as e-commerce rescued most households” staying home.
“This will strengthen, not retreat,” Norton said.
Also, the internet “is now a required utility,” he said. “Our regional internet service must be faster, broader and better. With mom and dad working remotely and children doing distant classroom learning, internet disruptions and speed are disasters to both. Georgia and local governments should be investing on fiber pipelines or fiber webs across all regions.”
While some companies adapted, switching to delivery and other e-commerce methods, others struggled, particularly manufacturing.
“Parts inventory for America’s assembly line took a major hit in the gut,” Norton said. “Watch large industrial giants create multiple threads of intercontinental supply chains with parts coming from multiple global providers: China, South America and yes, back in the good ‘ol USA.”
Housing ‘became the bright star’
“The forced exile into our homes played with the American psyche,” Norton said. “Homes pivoted to offices, classrooms, recreation, fitness centers and food stuff/toilet paper warehouses.”
Also, Americans looked around at the space they were living in and began considering “upsizing, resizing and reconfiguring their home life,” Norton said.
“Home sales ended (2020) in Georgia with the best year in decades. Shortages of new homes, rising prices and multiple purchase offers are the norm. Statistically, the January 2021 inventory is in the cellar.”
Industrial expansion ‘hits a record’
The Hall County area has become a distribution hub, with Norton noting that “there are almost 71 million people within an 8-hour truck drive distance from our region.”
“And the industrial growth has just started,” he said.
Norton “is tracking multiple prospects for other big box distributing centers into South Hall, Jackson, Banks, North Gwinnett, Franklin, Hart and Northeast Hall. One such user is seeking space to park 1,000 commercial delivery vans, plus 1,000 driver cars as part of a last-mile distribution superport.”
Urban exodus to rural Georgia
People are fleeing the cities to buy homes on bigger lots in rural areas, “where they have distance between neighbors, potential self-family isolation and enough outdoor space allowing them to breathe.”
“This accelerated home sales is in all parts of exurban Atlanta and well into the rural mountain regions,” Norton said. “A large portion of the homes are second home sanctuaries, but a surprising number are defaulting to primary residences.”
Million-dollar homes doing well
“There were more million-dollar homes sold on Lake Lanier — all five counties that surround the lake — in 2020 than in any other year on record,” Norton said.
“Wealthy buyers have rationalized buying a second home, specifically a lake property purchase versus multiple years of exotic or European vacations, he said.
Plus, as with urbanites buying bigger homes in the country, they’re also being drawn to the lake because “lake homes have no back-door neighbors.”
Material and labor shortages increase
“Whether it’s blaming COVID-19 or using COVID-19 as an excuse, there is a growing shortage of home construction components across all the North Georgia region,” Norton said. “This, coupled with staggering material price increases, is putting added pain to an industry struggling to provide affordable houses to a widening gap of the population.”
Price increases “are wreaking havoc on the custom-build and presale new home construction markets,” he said.
Industrial trend is ‘last-mile delivery’
“As Amazon and Walmart build and fill their big box warehouses, the next link in the chain of delivery from manufacturer to consumer is simply ‘the last mile,’ getting those cardboard boxes filled with necessities or extravagances from conveyor belt to front door stoops across North Georgia,” Norton said.
“Look for more announcements,” including along Interstate 985, he said.
Decades-long ‘Water Wars’ continues
The latest litigation over water usage by Georgia heads to the U.S. Supreme Court in February.
A victory there for Georgia would be “a major win for the stability of Lake Lanier,” Norton said.
It also “would at last allow long-term planning for our watershed to include the exploration of raising the Lake Lanier pool level by 2 feet,” he said.
Lanier’s summer full pool is 1,071 feet above sea level and winter full pool, 1,070 feet.
“A simple 2-foot increase would provide thirsty metro Atlanta all the water they could possibly use … over a year in the worst drought envisioned.”
Local leadership changes
In governments around the area, a “flood of new residents is completely upending … leadership positions, reshaping priorities and jeopardizing historically vested interests,” Norton said.
“We have seen it demonstrated in Forsyth County, the towns of Braselton, Flowery Branch and in Barrow County,” he said.
Norton predicted the same could happen in tiny Hoschton, which has 1,377 people, because of the development of Twin Lakes, a 2,400-home development.
The Jackson County city “will see their political power shift with the emergence of 6,000 residents … at (the development’s) full build-out,” he said.
Retail in an ‘identity crisis’
Retail struggled before the pandemic, thanks to a rise in e-commerce.
“The pandemic simply fast-forwarded store closures, bankruptcies, liquidations, product repositioning, mall abandonment and consumer tastes,” Norton said.
“Certain species survived because they were strong enough to. Others have been weighed down by too much debt. Thousands of brick-and-mortar stores shuttered in 2020,” he said.
Those succeeding have pivoted to such trends as personal service, personal shopping, delivery, takeout and online ordering.