1Q 2012 | Atlanta Midtown Office | Market Report

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Q1 2012 | MIDTOWN

ATLANTA

SUBMARKET REPORT

TRENDS & HIGHLIGHTS NEW SUPPLY, ABSORPTION AND VACANCY RATES

Total SF

300,000

Vacancy Rate

Square Feet

200,000 100,000 0 1Q11

2Q11

3Q11

4Q11

1Q12

(100,000)

(200,000) (300,000) Absorption

Deliveries

20% 19% 18% 17% 16% 15% 14% 13% 12% 11% 10%

22,225,522 18.4%

YTD Net Absorption

241,527

YTD Deliveries Under Construction

0 450,000

Avg. Class A Rate

$27.00

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

Promenade II

$137,500,000

774,344

$177.57

Cousins Properties

201 17th Street

$48,800,000

349,402

$139.67

CBRE Investors

675 Ponce de Leon

$27,000,000

2,000,000

$13.50

Jamestown Properties

728-736 West Peachtree

$4,439,600

25,400

$174.79

SunTrust Banks

Midtown

LEASING ACTIVITY

www.colliers.com/atlanta

TENANT

PROPERTY ADDRESS

SIZE SF

TYPE

tvsdesigns

Promenade II

74,854

Class A Renewal & Contraction

IMG Worldwide

1075 Peachtree

42,868

Class A Lease

Norfolk Southern

Promenade II

37,000

Class A Lease

Duane Morris

1075 Peachtree

27,898

Class A Lease

Midtown had the second highest amount of office space absorbed in the first quarter. Occupancy increased by 241,527 square feet during the period. The largest move-ins contributing to this increase were mostly full floor transactions; examples being Ogilvy & Mather at 217 17th Street, Gensler at 999 Peachtree and Routematch at One Atlantic Center.

Leasing activity in Midtown has been fairly consistent and steady over the past year. Since the first quarter of 2012, the overall office vacancy rate in the submarket has dropped one percent.

The average rental rate for office space in Midtown is the highest in the Atlanta market at $24.52/sf. Still, despite the positive conditions, rents have yet to show any signs of trending upwards.

Looking ahead, Midtown is expected to be one of the stronger office submarkets in Atlanta in 2012.


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