Reports: No Sign of Atlanta Office Slowdown in Q2

The expansion of Atlanta’s office market remains resilient through the second quarter of 2019 and shows no signs of slowing, according to Colliers’ Atlanta Q2 2019 Office report. Elsewhere, NKF reported that Midtown has now officially eclipsed Buckhead as the most expensive office submarket, with average rental rates reaching $36.52-per-square-foot compared to Buckhead’s $35.82-per-square-foot.

The Atlanta market absorbed another 470,000 square feet of office space in the second quarter, Colliers reports, which is similar to last year’s Q2 amount. Year-to-date net absorption now sits at just under one million square feet. Additionally, office vacancy showed little change quarter-over-quarter, as net absorption and newly-delivered square feet were closely balanced. The firm predicts that annual absorption for 2019 could top two million square feet, which would be the highest amount since 2015.

“This quarter’s 4% rise in the market’s average rent is among the nation’s highest increases, and shows the confidence landlords have in Atlanta’s activity,” said Scott Amoson, director of research at Colliers’ Atlanta office. “If any concern exists, it would be focused on the amount of new office product in development. While almost half of current construction activity is either build-to-suit or 100% leased, the remaining ‘for lease’ product is only around 25% leased. Add in the number of projects set to kick off in the coming quarters, and the Atlanta office market is looking at a significant amount of vacant office space to be added over the next few years.”

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