Q2 2010 | NORTHWEST ATLANTA
ATLANTA
SUBMARKET REPORT
TRENDS & HIGHLIGHTS NEW SUPPLY, ABSORPTION AND VACANCY RATES 100,000
50,000
Vacancy Rate
19%
YTD Net Absorption
18% 3Q09
4Q09
1Q10
2Q10
(50,000)
15% Absorption
Deliveries
19.2% (22,557)
YTD Deliveries
0
Under Construction
0
17% 16%
(100,000)
24,318,917
20%
0 2Q09
Total SF
Avg. Class A Rate
$20.56
Source: CoStar Property
Vacancy
MARKET INDICATORS Q2 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
1886 Stallion Pkwy.
$2,882,000
10,840
$265.87
International Capital, LLC
1580 Terrell Mill Rd.
$2,800,000
24,784
$112.98
Reformed Theo. Semin.
3825 Cherokee St.
$1,635,000
10,000
$163.50
Braden & Flanagan, LTD
Olde Ivey Condo 110
$1,425,000
13,000
$109.62
Goddard School
Cumberland
LEASING ACTIVITY
www.colliers.com/atlanta
TENANT
PROPERTY ADDRESS
SIZE SF
TYPE
GE Energy
Parkwood Point
106,638
Class A Lease
JM Huber
Cumberland Center II
55,716
Class A Lease
WinSonic Digital Media
2251 Lake Park Dr.
33,794
Class B Lease
Principal Financial Services
Riveredge Place
24,561
Class A Renewal
•
Though absorption in second quarter was slightly positive for the Cumberland office market, the vacancy rate continues to remain flat. Around 4.7 million square feet of vacant space is available for lease in the submarket.
•
Physician’s Education moved into almost 100,000 SF of Class B space in the submarket in second quarter. This was the second largest move-in for the Atlanta office market.
•
The average rental rate for office in the Cumberland market is down 2.8% from this time last year. Over the past two and a half years, average rates have dropped 8.7%.
•
Deal activity in the submarket has picked up over the last three months. Positive absorption is expected in third quarter, and leasing activity is anticipated to remain strong for the remainder of the year.
MARKET REPORT | Q2 2010 | ATLANTA OFFICE | NORTHWEST ATLANTA
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)
Riverwood 100
Overlook III
300 Galleria
200 Galleria
Cumberland Center II
502,519 SF
438,709 SF
433,366 SF
438,273 SF
413,247 SF
86.9%
71%
77%
73%
93.9%
24,931 SF
33,101 SF
23,139 SF
23,094 SF
18,534 SF
$25.00
$23.50-$25.00
$24.50
$15.00-$22.00
$22.50
1
2
3
4
5
One Paces West
Two Paces West
Platinum Tower
3200 Wildwood Plaza
274,948 SF
371,523 SF
312,591 SF
701,327 SF
78.5%
73.8%
86%
76.3%
47,550 SF
47,550 SF
20,550 SF
69,425 SF
$20.50-$21.00
$20.50-$21.00
$22.00
$23.50-$24.25
6
7
8
9
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 | Q2 2010 | ATLANTA OFFICE | NORTHWEST ATLANTA
9 5
4
8
4
3 3
2 1 5
1 2
4 1 2
6 7
6
PLANNED CONSTRUCTION
AERIAL LEGEND Buildings by Numbers (see opposite page)
1 2555 CUMBERLAND PKWY. 206,000 SF Class A office Construction contingent upon leasing Developer: Shailendra Group
New Construction
POINTS OF INTEREST Chattahoochee Recreation Center
1 Cumberland Mall
4
2 Galleria Mall
5 Dobbins Air Base
3
Cobb Energy Arts Centre
6 Vinings Area
2
RIVERWOOD PROJECT $300M project 530,000 SF Class A office 90,000 SF retail 400 residential units 200 room hotel Developer: Seven Oaks Co.
COLLIERS INTERNATIONAL |
P. 3
MARKET REPORT | Q2 2010 | ATLANTA OFFICE | NORTHWEST ATLANTA
IN THE NEWS bringing smart grid division to Atlanta: The Cumberland area will be home to GE’s newest business division focused on smart grid technology. The company announced it will be leasing just over 100,000 SF of office at Parkwood Point with plans to move into the space by the beginning of October. As part of the project, a $15 million Smart Grid Center of Excellence is also planned. This announcement establishes a new industry to the area and will position Atlanta as a leader in green energy. As both the Atlanta Business Chronicle and Atlanta Journal-Constitution have reported, the new division will bring approximately 400 high-paying jobs to the area over the next three years. Growth in the smart grid industry could also lead to more companies seeking office space in the area. In addition, local companies already associated with smart grid technology could likely expand. The Cumberland market stands to benefit the most from the space demand. The new division expands GE’s presence in the Cumberland market. GE Energy is headquartered at Wildwood and the company currently leases over 450,000 SF in the area.
480 offices in 61 countries on 6 continents
• GE
• Atlanta
office complex part of $1.4B deal: RiverEdge Summit is expected to be part of a 33-property portfolio sold to Dividend Capital as soon as the deal closes. iStar Financial is selling the two buildings along with 20 other office buildings and 11 industrial properties. RiverEdge Summit is valued at $63 million.
United States: 135 Canada: 39 Latin America: 17 Asia Pacific: 194 EMEA: 95 •
$2 billion in annual revenue
• Over 2 billion square feet under
management • Over 15,000 professionals
UNITED STATES: KENNESAW | MARIETTA | CHEROKEE CO. Office Market Stats
100,000
20%
Total SF
19%
Vacancy Rate
18.6%
18%
YTD Net Absorption
66,816
17%
YTD Deliveries
24,236
16%
Under Construction
79,150
80,000 60,000 40,000
24,318,917
Colliers International 1349 West Peachtree Street Suite 1100 Atlanta, Georgia, 30309 TEL +1 404 888 9000 FAX +1 404 870 2845
20,000 0 (20,000)
2Q09
3Q09
4Q09
1Q10
2Q10
(40,000) (60,000)
15% Absorption
Deliveries
Avg. RentalRate
$18.41 Source: CoStar Property
Vacancy
COLLIERS INTERNATIONAL | ATLANTA OFFICE | NORTHWEST ATLANTA LISTINGS
JONQUIL VILLAGE
2700 CUMBERLAND
GALLERIA 600
10,376-20,752 SF Lease Andrew Walker
34,812 SF Sublease Andrew Walker / Fred Sheats / Bob Mathews
14,200 SF Sublease Pete Shelton
TWO BARRETT LAKES
ONE RIVERSIDE
RAVINE ONE
9,317 SF Sublease Jeff Kelley / Pete Shelton / Bob Ward
15,624 SF Sublease Brett Kingman / Russ Jobson
4,306 SF Sublease 7,338 SF Sublease Andrew Walker / Pete Shelton
www.colliers.com/atlanta
COLLIERS INTERNATIONAL ATLANTA OFFICE SPECIALISTS: Bob Allen
Bob Mathews
Neal Baker
Craig Mendel
Patrick Braswell
Scott O’Halloran
Lee Evans
Hugh Pafford
Russ Jobson
Jodi Selvey
Nicole Kamen
Fred Sheats
Jeff Kelley
Pete Shelton
Brett Kingman
Andrew Walker
Michael Lipton
Bob Ward
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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