Q3 2010 | DOWNTOWN
ATLANTA
SUBMARKET REPORT
TRENDS & HIGHLIGHTS NEW SUPPLY, ABSORPTION AND VACANCY RATES 200,000
Total SF
24,937,459
17%
Vacancy Rate
15.4%
16%
YTD Net Absorption
74,179
150,000 100,000 50,000
15%
0 (50,000)
3Q09
4Q09
1Q10
2Q10
3Q10
(100,000)
YTD Deliveries
0
Under Construction
0
14% 13%
(150,000) (200,000)
12% Absorption
Deliveries
Avg. Class A Rate
$19.49
Source: CoStar Property
Vacancy
MARKET INDICATORS Q3 2010
NEXT QTR
UPDATE Recent Transactions in the Market SALES ACTIVITY
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VACANCY NET ABSORPTION CONSTRUCTION
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RENTAL RATE
PROPERTY ADDRESS
SALE PRICE
SIZE SF
PRICE / SF
BUYER
120 Ralph McGill Blvd. (Forc.)
$2,950,000
23,080
$127.82
Sunrise Bank of Atlanta
159 Ralph McGill Blvd. (Forc.)
$1,200,000
36,000
$33.33
Georgia Properties LLC
353-363 Parkway Dr.
$1,000,000
9,000
$111.11
Metro. Atlanta Ob/Gyn
139 Ralph McGill Blvd.
$850,000
19,500
$43.59
Ralph McGill 139, LLC
Downtown
LEASING ACTIVITY
www.colliers.com/atlanta
TENANT
PROPERTY ADDRESS
SIZE SF
TYPE
InComm
250 Williams St.
186,675
Class A Renewal & Exp.
Carlock Copeland & Stair
191 Peachtree
52,000
Class A Lease
McKinsey & Co.
Georgia Pacific Center
50,000
Class A Renewal
CredAbility
270 Peachtree
41,772
Class A Lease
•
Downtown remains one of most stabilized office markets in Atlanta. Third quarter absorption totaled 49,202 SF, marking the second consecutive quarter of increased occupancy.
•
For the year, office leasing in the Downtown office submarket has been steadily consistent. The largest deal this quarter was a renewal and expansion by InComm at 250 Williams Street. The gift and prepaid card distributor will be moving into an additional 90,506 SF early next year.
•
On the whole, Downtown has held its own through the current economic landscape. In the past two years, the submarket has essentially broke even with move-ins and move-outs.
•
Downtown is garnering a lot of attention as of late with new attractions being suggested for the area.
MARKET REPORT | Q3 2010 | ATLANTA OFFICE | DOWNTOWN
SKYLINE REVIEW Space Available Direct Sublet
60 55 50 45 40
Floors
35 30 25 20 15 10 5
BUILDING RBA % LEASED LARGEST SPACE AVAIL. RENTAL RATE PER SF (Gross)
Bank of America Plaza
SunTrust Plaza
Georgia-Pacific Center
191 Peachtree
Centennial Tower
1,253,499 SF
1,249,022 SF
1,133,840 SF
1,209,721 SF
638,731 SF
80.6%
92.4%
88.4%
84.8%
89.5%
203,068 SF
23,545 SF
112,609 SF
102,045 SF
37,600 SF
$30.00-$31.00
$26.00-$28.00
$21.00-$22.00
$26.00
$15.00-$22.00
1
2
3
4
5
12 11
8
1 9
2
7
8 4 3 10 9 6 3 5
10
2 7 6
5 4
3 P. 2
| COLLIERS INTERNATIONAL
2
1
1
13
15 14
16
MARKET REPORT | Q3 2010 | ATLANTA OFFICE | DOWNTOWN
NOTABLE PROJECTS Source: CoStar Property
1
E Q U I TA B L E
GSU SCIENCE CENTER 350,000 SF Delivered March 2010
2
100 Peachtree
Marquis One
North Tower
270 Peachtree
55 Park Place
625,000 SF
460,437 SF
302,951 SF
325,000 SF
553,018 SF
47.7%
67%
65.9%
73.1%
74.2%
122,386 SF
54,287 SF
127,713 SF
41,772 SF
278,716 SF
$17.50-$19.50
$20.50-$21.50
$18.50-$19.50
$18.00-$19.00
$18.50
6
7
8
9
10
AERIAL LEGEND
POINTS OF INTEREST 1 Georgia Dome
100,000 SF $125 million project Construction pending
3
9 The Varsity
2 Philips Arena
10 Georgia Tech
World 3 Georgia Congress Center
11 Atlanta Civic Center
4 CNN Center
Sweet Auburn 12 Curb Market
MARTA Rail Line
5 Centennial Olympic Park
13 Georgia State University
New Construction
6 Georgia Aquarium 14 Underground Atlanta
Buildings by Number (see opposite page)
CIVIL RIGHTS MUSEUM
7 World of Coke
15 State Capital
8 The Fox Theater
16 Turner Field
50 ALLEN PLAZA 870,914 SF Developer: Barry Real Estate Proposed
COLLIERS INTERNATIONAL |
P. 3
MARKET REPORT | Q3 2010 | ATLANTA OFFICE | DOWNTOWN
IN THE NEWS
480 offices in 61 countries on 6 continents
• Plenty
of land downtown, boosters tell developers: Central Atlanta Progress recently released a map highlighting areas ripe for development in the submarket. The map shows five areas in Downtown with tracts large enough to support transformative development. These five areas include: the area near Five Points MARTA station, the ‘Gulch’ area near the Georgia Dome, the Sweet Auburn district, the Fairlie-Poplar district and the “railroad district” near Castleberry Hill. In all, these areas encompass a total of 467 under utilized acres. plans for ‘Gulch’ hub a transit gamble: With plans for a multi-modal transit terminal back on track, the project faces a number of uncertainties. The total cost of such a grandiose project is one; especially when even the best guess could be far off. Funding to build rail systems linking to the hub is another, along with whether or not metro Atlantans will take it upon themselves to adopt alternative transportation. Finally, there is question as to whether or not the hub will create demand for more real estate in the area given the excess of empty and dilapidated buildings. Regardless, enough interest from both local and international development firms exists for redeveloping the 16-acres tract.
United States: 135 Canada: 39 Latin America: 17 Asia Pacific: 194 EMEA: 95
• Grand
• Cox
Enterprises donates former AJC building to city: The former location of the Atlanta JournalConstitution is being donated to the city of Atlanta by Cox Enterprises. The AJC relocated from the facility earlier this year to office space in Central Perimeter. The donation includes a nine-story office building, four-story printing press building, warehouse space and surface parking. Mayor Kasim Reed plans to use the facilities for police and fire training academies, gallery space and for a public auditorium.
AT A GLANCE | Streetcar gets funding
•
U.S. Department of Transportation agrees to grant $47 million to the city’s proposed $70 million streetcar project.
•
First phase of project will run 2.6 miles from the King Center site to Centennial Olympic Park, featuring a dozen stops and direct connection to MARTA.
•
•
•
•
$2 billion in annual revenue
• Over 2 billion square feet under
management • Over 15,000 professionals
UNITED STATES: Colliers International 1349 West Peachtree Street Suite 1100 Atlanta, Georgia, 30309 TEL +1 404 888 9000 FAX +1 404 870 2845
COLLIERS INTERNATIONAL ATLANTA OFFICE SPECIALISTS: Bob Allen
Craig Mendel
Expected to provide 2,600 trips a weekday in its first year of operation.
Neal Baker
Scott O’Halloran
Lee Evans
Hugh Pafford
Critics argue the streetcar will do nothing to ease metro Atlanta’s biggest transportation problems.
Huston Green
Jodi Selvey
Russ Jobson
Fred Sheats
Construction begins in 2012 with a completion date targeted for 2013.
Nicole Kamen
Pete Shelton
Jeff Kelley
Hayes Swann
Brett Kingman
Andrew Walker
Michael Lipton
Bob Ward
Bob Mathews COLLIERS INTERNATIONAL | ATLANTA OFFICE | DOWNTOWN LISTINGS
135 ANDREW YOUNG INTL. BLVD. 11,000 SF Sale Jodi Selvey / Pete Shelton
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.
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