1Q 2012 | Atlanta Central Perimeter Office | Market Report

Q1 2012 | CENTRAL PERIMETER

ATLANTA

SUBMARKET REPORT

TRENDS & HIGHLIGHTS NEW SUPPLY, ABSORPTION AND VACANCY RATES 1Q11

2Q11

3Q11

4Q11

300,000

22%

Square Feet

24%

200,000

20%

100,000

18%

0

16%

(100,000)

14%

(200,000)

12%

(300,000)

10% Deliveries

28,538,478

Vacancy Rate

1Q12

400,000

Absorption

Total SF

21.1%

YTD Net Absorption YTD Deliveries Under Construction Avg. Class A Rate

302,266 16,000 600,000 $21.83

Source: CoStar Property, Colliers Research

Vacancy

MARKET INDICATORS Projected

Q1 2012

UPDATE Recent Transactions in the Market

Q2 2012

SALES ACTIVITY VACANCY PROPERTY ADDRESS

NET ABSORPTION CONSTRUCTION RENTAL RATE

—

SALE PRICE

SIZE SF

PRICE / SF

BUYER

1200 Ashwood Pkwy.

$9,800,000

183,619

$53.37

Atlanta Property Group

56 Perimeter Center East

$9,425,000

94,575

$99.66

The Simpson Org.

600 Morgan Falls Rd.

$6,000,000

106,678

$56.24

Resource Real Estate

4500 N Shallowford Rd.

$5,210,000

20,366

$255.82

Universal Health Serv.

Central Perimeter

LEASING ACTIVITY

www.colliers.com/atlanta

TENANT

PROPERTY ADDRESS

SIZE SF

TYPE

Dell Secureworks

Concourse Corp. Ctr. I

115,000

Class A Renewal & Expansion

Elavon

Concourse Corp. Ctr. I

112,000

Class A Renewal & Expansion

AirWatch

1155 Perimeter Ctr. West

102,362

Class A Lease

CHEP

245 Perimeter Center

60,000

Class A Lease

•

Central Perimeter led the Atlanta market in office space absorption in the first quarter. The major move-ins for the submarket were Ventyx which relocated from Northwest Atlanta into 55,257 SF at North Terraces, and Internap which relocated office functions from Downtown Atlanta to 58,624 SF in 1 Ravinia.

•

Cox Enterprises’s first phase of its new office complex is expected to deliver in the second quarter.

The company will consolidate from other office buildings in the submarket to the new 300,000 SF building. The second phase is not expected to deliver until the fourth quarter of this year.

•

After a rough 2011, office leasing is returning to Central Perimeter. The submarket remains one of the more attractive areas for companies to relocate offices. It is expected to be one of the strongest office submarkets in 2012.

MARKET REPORT | Q1 2012 | ATLANTA OFFICE | CENTRAL PERIMETER

SKYLINE REVIEW Space Available Direct Sublet 35

Source: CoStar Property

30

Floors

25 20 15 10 5

BUILDING

Concourse VI

Concourse V

Three Ravinia

Glenridge Highlands II

7000 Central Park

RBA

697,400 SF

687,107 SF

813,145 SF

415,000 SF

415,324 SF

TYPICAL FLOOR SIZE

27,000 SF

26,719 SF

25,827 SF

20,750 SF

28,000 SF

% LEASED

85.5%

81.5%

94.7%

66.2%

88.1%

31,672 SF

76,455 SF

25,461 SF

123,997 SF

19,204 SF

$24.50-$25.50

$24.50-$25.50

$24.60

$22.50-$26.50

$23.50

1

2

3

4

5

2002 Summit Blvd.

400 Northpark

One Ravinia

Two Ravinia

64 Perimeter Ctr. E

RBA

390,139 SF

586,256 SF

386,239 SF

437,826 SF

381,432 SF

TYPICAL FLOOR SIZE

24,000 SF

24,000 SF

23,500 SF

23,400 SF

24,833 SF

% LEASED

85.1%

91.4%

81.6%

81.1%

12.1%

24,677 SF

39,901 SF

32,835 SF

24,312 SF

358,055 SF

$26.50

$25.00-$25.50

$21.50-$23.50

$21.50-$22.50

$20.00-$21.00

6

7

8

9

10

LARGEST SPACE AVAIL. RENTAL RATE PER SF (Gross)

35 30

Floors

25 20 15 10 5

BUILDING

LARGEST SPACE AVAIL. RENTAL RATE PER SF (Gross)

P. 2

| COLLIERS INTERNATIONAL

MARKET REPORT | Q1 2012 | ATLANTA OFFICE | CENTRAL PERIMETER

7 2 4

5

5

1

8 9 3

10

1 1 2 6 3

2

3

4

4 6

PLANNED CONSTRUCTION

AERIAL LEGEND

1

3

Buildings by Number (see opposite page) MARTA Rail Line New Construction

POINTS OF INTEREST

4004 PERIMETER SUMMIT

600,000 SF Planning Stage Developer: Rubenstein Partners

400,000 SF Planning Stage Developer: Seven Oaks

2

1 Perimeter Mall

4 Scottish Rite

2 Northside Hospital

5 Perimeter Place

St. Joseph’s 3 Hospital

240 PERIMETER CTR. PKWY.

6 Marist High School

4

ABERNATHY 400

TWO NORTH PLACE

350,000 SF Planning Stage Delivering TBD Developer: Ackerman/Russell

230,000 SF Planning Stage Delivering TBD Developer: Crocker Partners COLLIERS INTERNATIONAL |

P. 3

MARKET REPORT | Q1 2012 | ATLANTA OFFICE | CENTRAL PERIMETER

IN THE NEWS • Dell

SecureWorks completes Concourse lease: Dell SecureWorks recently signed a 115,000 SF renewal and expansion at Concourse Corporate Center One. The company will be expanding its current office space in the building by 76,000 SF. It was reported last year SecureWorks was looking to grow its office space due to Dell, Inc.’s acquisition of the company and its subsequent plans of adding 200 jobs in Atlanta. The new jobs will include engineers, researchers and sales people which will assist the company with providing information security services to its clients. plans to add 400 jobs to Central Perimeter area: AirWatch LLC is expanding its office space in Atlanta and moving to the Central Perimeter submarket. The company recently signed a lease for 102,362 SF at 1155 Perimeter Center to accommodate the addition of 400 new jobs; part of a $20 million expansion by the company. AirWatch will be relocating from 40,000 SF of loft office space in Midtown. Central Perimeter was chosen as the company’s new office location for recruitment purposes.

522 offices in 62 countries on 6 continents United States: 147 Canada: 37 Latin America: 19 Asia Pacific: 201 EMEA: 118

• AirWatch

• Atlanta’s

royal couple on the market: It has been reported TIAA-CREF will be selling Atlanta’s most iconic office building couple. Concourse Corporate Center V & VI are officially on the market and are expected to be one of the city’s largest commercial office transactions since 3344 Peachtree sold in Buckhead last year. Estimates pin the sale at $245 million or more. Together the buildings total 1,384,507 SF. They are being marketed alongside the rest of the Concourse Corporate Center office complex which TIAA-CREF also owns.

AT A GLANCE | King & Queen Buildings on the Market

•

$1.8 billion in annual revenue

• Over 2.5 billion square feet under

management • Over 12,000 professionals

UNITED STATES: Colliers International Two Midtown Plaza | Suite 1100 1349 West Peachtree Street, NE Atlanta, Georgia, 30309 TEL +1 404 888 9000 FAX +1 404 870 2845

•

Iconic Class A office towers totaling 1,384,507 SF.

•

Built in 1988 and 1991. Together, buildings are currently 83.5% leased.

•

Could fetch up to $245 million for the pair; or around $175 per square foot.

COLLIERS INTERNATIONAL ATLANTA OFFICE SPECIALISTS:

•

Major tenants include CompuCredit, Ericsson, Morgan Stanley and Gifford Hillegass & Ingwersen.

Bob Allen

Bob Mathews

Jill Bomar

Craig Mendel

Lee Evans

Scott O’Halloran

Part of larger 2.1 million-square-foot office park which is also being put on the market for sale.

Deming Fish

Hugh Pafford

Huston Green

Jodi Selvey

Tim Huffman

Fred Sheats

Current owner is TIAA-CREF.

Russ Jobson

Pete Shelton

•

•

COLLIERS INTERNATIONAL | ATLANTA OFFICE | CENTRAL PERIMETER LISTINGS

Jeff Kelley

Hayes Swann

Drew Lavine

Andrew Walker

Michael Lipton

Bob Ward

Nicole Littleton

219 PERIMETER CTR. 4,942-21,947 SF Sublease Bob Mathews / Fred Sheats 185 ALLEN RD. 4,109 SF Andrew Walker 121 PERIMETER CTR. 1,772-16,822 SF Sublease Craig Mendel

www.colliers.com/atlanta

CENTER POINTE 3,861 SF Sublease Craig Mendel EMBASSY ROW 1,576-75,000 SF Lease Scott O’Halloran/ Lee Evans/ Deming Fish

This market report is a research document of Colliers International. Information herein has been deemed reliable and no representation is made as to the accuracy thereof. Colliers International-Atlanta, Inc., and certain of its subsidiaries, is an independently owned and operated business and a member firm of Colliers International Property Consultants, an affiliation of independent companies with over 520 offices throughout 62 countries worldwide.

5620 GLENRIDGE 84,580 SF Lease/Sale Hugh Pafford

Accelerating success.