Q3 2010 | CENTRAL PERIMETER
ATLANTA
SUBMARKET REPORT
TRENDS & HIGHLIGHTS
Square Feet
NEW SUPPLY, ABSORPTION AND VACANCY RATES 200,000
22%
100,000
20%
0
18%
(100,000)
4Q09
1Q10
2Q10
3Q10
4Q10
16%
(200,000)
14%
(300,000)
12%
(400,000)
10% Absorption
Deliveries
Total SF
28,376,798
Vacancy Rate
20.4%
YTD Net Absorption
17,801
YTD Deliveries
0
Under Construction
0
Avg. Class A Rate
$22.29
Source: CoStar Property
Vacancy
MARKET INDICATORS Q4 2010 VACANCY
NEXT QTR
UPDATE Recent Transactions in the Market SALES ACTIVITY
—
PROPERTY ADDRESS
NET ABSORPTION CONSTRUCTION
—
—
RENTAL RATE
SALE PRICE
SIZE SF
PRICE / SF
BUYER
9000 Central Park
$31,955,979
204,632
$156.16
Cox Enterprises
41, 47, 53 Perimeter Ctr. E.
$14,864,999
279,788
$53.13
Atlanta Property Group
600 Morgan Falls Rd.
$5,000,000
106,678
$46.87
Parkway Properties
5424 Glenridge Dr.
$4,250,000
15,000
$283.33
Shoffland Holdings LLC
Central Perimeter
LEASING ACTIVITY
www.colliers.com/atlanta
TENANT
PROPERTY ADDRESS
SIZE SF
TYPE
Zurich North America
1001 Perimeter Summit
112,316
Class A Lease
United Healthcare
Ashford Green
100,000
Class A Renewal
Munich American Reass.
56 Perimeter Center
63,500
Class A Renewal
Beecher Carlson
Concourse VI
24,375
Class A Lease
•
Despite leading the market in total leasing activity for the year, Central Perimeter only absorbed 17,801 SF in 2010. This is due to the transactions completed being in the form of renewals, some as contractions of space; and tenants moving within the submarket.
•
Cox Enterprises was the most active company in Central Perimeter in 2010. In addition to beginning construction of a 600,000 SF office complex, the company and its subsidiaries moved or expanded into several buildings including 9000 Central Park, 3003 Perimeter Summit and 223 Perimeter Center Pkwy. The company also invested $32 million for 9000 Central Park.
•
Central Perimeter has a long road ahead to recovery. Over 1 million sq. ft. of vacant space was added over the past three years. Because of this, rents and concessions will continue to remain competitive.
MARKET REPORT | Q4 2010 | ATLANTA OFFICE | CENTRAL PERIMETER
SKYLINE REVIEW Space Available Direct Sublet 35
Source: CoStar Property
30
Floors
25 20 15 10 5
BUILDING RBA % LEASED LARGEST SPACE AVAIL. RENTAL RATE PER SF (Gross)
Concourse VI
Concourse V
Three Ravinia
Glenridge Highlands II
2002 Summit Blvd.
697,400 SF
687,107 SF
813,145 SF
415,000 SF
390,139 SF
82.9%
94.8%
89.4%
50.6%
82.8%
48,868 SF
76,491 SF
51,205 SF
192,518 SF
48,000 SF
$23.50-$24.50
$24.50
$23.00-$25.00
$22.50-$26.50
$26.50
1
2
3
4
5
7000 Central Park
400 Northpark
One Ravinia
Two Ravinia
64 Perimeter Ctr. E
415,324 SF
586,256 SF
386,239 SF
437,826 SF
381,432 SF
83.8%
74.9%
74%
85.1%
10.6%
18,340 SF
131,509 SF
47,204 SF
24,199 SF
363,630 SF
$23.50
$25.00-$25.50
$20.00-$22.00
$21.50-$23.50
$20.00-$21.00
6
7
8
9
10
35 30
Floors
25 20 15 10 5
BUILDING RBA % LEASED LARGEST SPACE AVAIL. RENTAL RATE PER SF (Gross)
P. 2
| COLLIERS INTERNATIONAL
MARKET REPORT | Q4 2010 | ATLANTA OFFICE | CENTRAL PERIMETER
7 2 4
5
6
1
8 9 3
10
1 1 2 5 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: Barry Real Estate
400,000 SF Planning Stage Developer: Hines Properties
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 | Q4 2010 | ATLANTA OFFICE | CENTRAL PERIMETER
IN THE NEWS • Zurich
480 offices in 61 countries on 6 continents
• Revolving
United States: 135 Canada: 39 Latin America: 17 Asia Pacific: 194 EMEA: 95
American chooses Perimeter Summit: Zurich American Insurance Co. signed a lease for 112,316 SF at 1001 Perimeter Summit, moving from space at 3003 Perimeter Summit close by. The move is an expansion of the company’s current office footprint in Atlanta and part of a regional consolidation which could bring up to 150 new jobs to the submarket. The move was triggered by AutoTrader.com which signed a lease for the entire 3003 Perimeter building earlier in the year. deals for Central Perimeter: Central Perimeter saw its share of large deals in 2010, some of which resulted in net occupancy gains for the submarket. Most of the office leasing that occurred in the past year, however, was from existing companies in the area. The impact on the submarket’s absorption depended on whether the company contracted or expanded its space usage in the transaction. Regardless, the bright spot to all of the intra-market activity shows that companies which locate to Central Perimeter tend to stay because of area amenities and transportation access. The negative aspect is that these intra-market moves do little to the vacant space available in the submarket.
• Access
Insurance inks lease at Three Ravinia: One of the largest deals this year was recently signed at Three Ravinia. Access Insurance Holdings will be leasing 80,000 SF in the 31-story office tower. The company plans to relocate from its current offices in Brookhaven, moving into Three Ravinia in October. The transaction will boost occupancy in the building from 78% to 88%. It is a big win for Colonial Properties Trust which recently became sole owner of the property in November of last year. AT A GLANCE | Hammond Half-Diamond Interchange
Bldgs. 200, 600, 1000, 1100 10,000-15,000 SF Sale Hugh Pafford / Jodi Selvey
www.colliers.com/atlanta
UNITED STATES: Colliers International 1349 West Peachtree Street Suite 1100 Atlanta, Georgia, 30309 TEL +1 404 888 9000 FAX +1 404 870 2845
•
Expected to relieve congestion at GA 400 and I-285.
COLLIERS INTERNATIONAL ATLANTA OFFICE SPECIALISTS:
•
Hammond Drive bridge will be replaced and raised higher to make room for future expansion of GA 400 lanes.
Bob Allen
Craig Mendel
Lee Evans
Scott O’Halloran
Project will cost an estimated $18 million to complete; completion date scheduled for Fall 2011.
Russ Jobson
Fred Sheats
Nicole Kamen
Pete Shelton
Deming Fish
Hugh Pafford
Huston Green
Jodi Selvey
Jeff Kelley
Hayes Swann
Brett Kingman
Andrew Walker
Michael Lipton
Bob Ward
Bob Mathews
1455 LINCOLN PKWY. 4,392 SF Sublease Brett Kingman / Russ Jobson 6160 PEACHTREE DUNWOODY
8215 ROSWELL RD.
management • Over 15,000 professionals
Half-diamond interchange: Northbound entrance to GA 400 from Hammond Drive, Southbound exit from GA 400 to Hammond Drive.
COLLIERS INTERNATIONAL | ATLANTA OFFICE | CENTRAL PERIMETER LISTINGS
4,942-21,947 SF Sublease Bob Mathews / Fred Sheats
$2 billion in annual revenue
• Over 2 billion square feet under
•
•
219 PERIMETER CTR.
•
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 480 offices throughout more than 61 countries worldwide.
2,217 SF Lease Fred Sheats 5620 GLENRIDGE 84,500 SF Lease/Sale Hugh Pafford
Accelerating success.