Q4 2011 | BUCKHEAD
ATLANTA
SUBMARKET REPORT
TRENDS & HIGHLIGHTS NEW SUPPLY, ABSORPTION AND VACANCY RATES 350,000 300,000
Square Feet
250,000 200,000 150,000 100,000 50,000 0 (50,000)
4Q10
1Q11
2Q11
3Q11
4Q11
24% 23% 22% 21% 20% 19% 18% 17% 16% 15% 14%
Total SF
20,538,847
Vacancy Rate
19.2%
YTD Net Absorption YTD Deliveries
0
Under Construction
0
Avg. Class A Rate Absorption
Deliveries
706,903
$25.09
Source: CoStar Property, Colliers Research
Vacancy
MARKET INDICATORS Projected
Q4 2011
UPDATE Recent Transactions in the Market
Q1 2012
SALES ACTIVITY VACANCY PROPERTY ADDRESS
NET ABSORPTION CONSTRUCTION RENTAL RATE
— —
SALE PRICE
SIZE SF
PRICE / SF
BUYER
3344 Peachtree Rd.
$167,300,000
483,726
$345.86
Parkway Properties
—
3314 Peachtree Rd./Land
$9,000,000
9,187
$979.65
Kurkin Forehand Brandes
—
3330 Peachtree Rd.
$5,500,000
62,499
$88
Pope & Land
Buckhead
LEASING ACTIVITY
www.colliers.com/atlanta
TENANT
PROPERTY ADDRESS
SIZE SF
TYPE
Capgemini
Prominence
24,816
Class A Lease
Prudential
Tower Place 200
16,045
Class A Lease
AloStar
3630 Peachtree
14,340
Class A Lease
Carat USA
Atlanta Plaza One
13,116
Class A Lease
•
As expected, Buckhead led all Atlanta office submarkets in 2011 accounting for almost all of the positive absorption in the year. Just over 80% of the space absorbed was in first generation space.
•
Overall office vacancy in Buckhead dropped 3.4% for the year. Since the deliveries of 3630 Peachtree and Phipps Tower (the last of new construction in the submarket), the vacancy rate has dropped 5%.
•
The flight to quality trend was most prominent in Buckhead which saw almost half of all Class A office absorption in 2011. Tenants relocating to the submarket for higher quality space include Ridgeworth Capital, Aldridge Connors and Windham Brannon.
•
Leasing activity for Buckhead office space is expected to remain strong in the coming year. The submarket will, however, face increased competition from neighboring submarkets as concession packages from Buckhead landlords have moderated somewhat.