Q2 2012 | NORTHWEST ATLANTA
ATLANTA
SUBMARKET REPORT
TRENDS & HIGHLIGHTS
Square Feet
NEW SUPPLY, ABSORPTION AND VACANCY RATES 150,000
19%
100,000
18%
50,000
17%
0 (50,000)
2Q11
3Q11
4Q11
1Q12
2Q12
16% 15%
(100,000) (150,000)
14%
(200,000)
13%
(250,000)
12% Absorption
Deliveries
Vacancy
Total SF
27,365,385
Vacancy Rate
17.9%
YTD Net Absorption
(169,602)
YTD Deliveries
0
Under Construction
0
Avg. Class A Rate
$21.68
Source: CoStar Property, Colliers Research
MARKET INDICATORS Projected
Q2 2012
UPDATE Recent Transactions in the Market
Q3 2012
SALES ACTIVITY VACANCY NET ABSORPTION CONSTRUCTION
—
—
RENTAL RATE
PROPERTY ADDRESS
SALE PRICE
SIZE SF
PRICE / SF
BUYER
355 Tower Rd.
$10,450,000
55,000
$190
Wellstar Health System
Cobb Galleria 75
$9,255,000
113,848
$81.29
Baker Dennard & Goetz
280 Interstate North Cir.
$8,700,000
124,273
$70.01
Atlanta Property Group
358 Roswell St.
$2,120,000
30,000
$70.67
Philip Goldstein
Cumberland
LEASING ACTIVITY
www.colliers.com/atlanta
TENANT
PROPERTY ADDRESS
SIZE SF
TYPE
First Option Mortgage
Platinum Tower
40,127
Class A Lease
PCI Group
1000 Parkwood
22,975
Class A Lease
In Zone Brands
Overlook III
17,911
Class A Lease
Timbervest
Northcreek OP 200
17,059
Class A Renewal & Expansion
•
Second quarter’s occupancy loss in the Cumberland office market was the worst of any other office submarket in Atlanta. Absorption totaled negative (212,176) SF over the past three months. Space consolidations by IBM at 1500 & 1600 Riveredge Pkwy. were the largest move-outs in the submarket. Also, Greenberg Traurig’s move-out at The Forum contributed to the negative result as well.
•
The Cumberland area is starting to see a small increase in leasing; however, activity remains lackluster for the most part. The submarket’s largest competitor, Central Perimeter, is seeing a majority of the leasing activity including the larger transactions in the market.
•
Cumberland is not likely to see substantial occupancy gains in the second half of 2012 which means the submarket will finish the year with more vacant space than it had at the beginning of the year.
MARKET REPORT | Q2 2012 | ATLANTA OFFICE | NORTHWEST ATLANTA
SKYLINE REVIEW Space Available Direct Sublet 35
Source: CoStar Property
30
Floors
25 20 15 10 5
Riverwood 100
Overlook III
200 Galleria
400 Galleria
Cumberland Center II
502,527 SF
438,709 SF
438,273 SF
440,000 SF
413,247 SF
TYPICAL FLOOR SIZE
21,889 SF
26,000 SF
22,000 SF
23,157 SF
24,308 SF
% LEASED
90%
80.2%
82.2%
83.2%
83.8%
24,931 SF
38,512 SF
23,094 SF
24,586 SF
49,500 SF
$24.50
$23.50-$24.00
$22.00
$24.50
$22.50
1
2
3
4
5
One Paces West
Two Paces West
Platinum Tower
The Towers at Wildwood Plaza
RBA
274,948 SF
371,523 SF
312,591 SF
706,307 SF
TYPICAL FLOOR SIZE
22,000 SF
20,640 SF
21,000 SF
43,362 SF
% LEASED
85.8%
87.3%
93.6%
93.5%
34,253 SF
16,851 SF
6,935 SF
25,341 SF
$21.00-$21.50
$21.00-$22.00
$24.00
$19.75-$24.50
6
7
8
9
BUILDING RBA
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 | Q2 2012 | ATLANTA OFFICE | NORTHWEST ATLANTA
9 5
4
8
3
4 2 3
2 1 5
1
1
4 2
6 7
6
AERIAL LEGEND
PLANNED CONSTRUCTION
Buildings by Numbers (see opposite page)
1
RIVERWOOD PROJECT
2
555 GALLERIA
New Construction
POINTS OF INTEREST Chattahoochee Recreation Center
1 Cumberland Mall
4
2 Galleria Mall
5 Dobbins Air Base
3
Cobb Energy Arts Centre
$300M project 530,000 SF Class A office 90,000 SF retail 400 residential units 200 room hotel Developer: Seven Oaks Co.
250,000-300,000 SF Class A Build-To-Suit Construction contigent upon leasing Developer: Childress Klein
6 Vinings Area
COLLIERS INTERNATIONAL |
P. 3
MARKET REPORT | Q2 2012 | ATLANTA OFFICE | NORTHWEST ATLANTA
IN THE NEWS
522 offices in 62 countries on 6 continents
• Marietta
getting New York company’s IT operations: Sterling Infosystems is relocating to Cobb County, bringing with it 35 high-paying software jobs. The company is an information technology and engineering business involved with employment screening systems. Positions to be filled include software applications developers, network engineers and software project managers. The state and county were chosen for the relocation due to the abundance of talent in the region and the technology ecosystem in Georgia. The move should be completed by the third quarter.
United States: 147 Canada: 37 Latin America: 19 Asia Pacific: 201 EMEA: 118
• IBM
campus site work started: The corporate campus for IBM off of Northside Parkway will soon be no more as redevelopment for a new North Atlanta High School has begun. The first phase of the project will include an 11-story building which will house 2,350 students. The second phase will include a 105,000 SF auditorium, theater and gym. Expected completion of phase one is the fall of 2013.
• Gentiva
expansion smaller than expected: Gentiva Health Services recently signed a renewal & expansion totaling 60,000 square feet at Riverwood 100. The amount of the expansion totals about 7,000 square feet. Back in 2011, the company was reported seeking almost 65,000 square feet for expansion, following an acquisition of Odyssey Healthcare in Dallas, TX and possibly adding 100 jobs. The new lease, however, does not include these additional jobs and for the time being it appears the smaller expansion will suit the company’s short-term needs.
Square Feet
KENNESAW | MARIETTA | CHEROKEE CO. Office Market Stats
140,000
18%
120,000
17%
100,000
16%
80,000
15%
60,000
8,657,996
Vacancy Rate
14.6%
YTD Net Absorption
13%
20,000
12%
0 2Q11
3Q11
4Q11
1Q12
2Q12
(40,000)
11% 10%
Absorption
Deliveries
YTD Deliveries
0
Under Construction
16,650
Avg. RentalRate
$15.76
Vacancy
Source: CoStar Property, Colliers Research
COLLIERS INTERNATIONAL | ATLANTA OFFICE | NORTHWEST ATLANTA LISTINGS
GALLERIA 75
955 COBB PLACE BLVD.
GALLERIA 600
1,412-3,413 SF Lease Scott O’Halloran / Will Tyler
10,731 SF Lease Andrew Walker
14,200 SF Sublease Pete Shelton
OVERLOOK III
ONE OVERTON PARK
11,184 SF Sublease Andrew Walker
6,673 SF Sublease Andrew Walker
NEWMARKET BUSINESS PARK 1,060-4,653 SF Lease Lee Evans / Scott O’Halloran
www.colliers.com/atlanta
$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
62,550
14%
40,000
(20,000)
Total SF
•
COLLIERS INTERNATIONAL ATLANTA OFFICE SPECIALISTS: Bob Allen
Bob Mathews
Jill Bomar
Craig Mendel
Lee Evans
Scott O’Halloran
Deming Fish
Hugh Pafford
Huston Green
Jodi Selvey
Tim Huffman
Fred Sheats
Russ Jobson
Pete Shelton
Jeff Kelley
Hayes Swann
Drew Lavine
Will Tyler
Michael Lipton
Andrew Walker
Nicole Littleton
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 520 offices throughout 62 countries worldwide.
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