ATLANTA OFFICE REPORT
Downtown Submarket
Q2 2022
Rental Rates, Construction on the Rise in Downtown
No change in vacancy rate in the past22.0% year
ABSORPTION AND VACANCY RATE 150,000
• Downtown Atlanta saw negative absorption of 43,664 square feet in Q2 of 2022. After leading the Atlanta market in Q1, Downtown took a small step back in line with recent trends: Q2 was the 9th negative absorption quarter out of the last 11 for the urban submarket.
100,000
20.0%
50,000 0
18.0%
‐50,000 ‐100,000
16.0%
‐150,000
• With the groundbreaking of Science Square Labs, Downtown now boasts over 1 million square feet of space under construction, the second-highest figure of any Atlanta office submarket behind only Midtown. 36% of this space is already leased, including Mailchimp signing a 300,000 square foot lease at the beltline-adjacent 760 Ralph McGill.
‐200,000
14.0%
‐250,000 ‐300,000
12.0%
‐350,000 ‐400,000
Q4 2020
• The average asking rent in Downtown has risen 4.5% in the past year, finishing Q2 at $30.74.
Q2 2021
Q4 2021
Absorption
10.0%
Q2 2022
Vacancy Rate
Source: CoStar
Total Inventory SF
Direct Vacancy Rate
Sublease Vacancy Rate
Total Vacant SF
Vac Rate Q2 ‘22
Vac Rate Q1 ‘22
Net Absorp Q2 ‘‘22
Net Absorp YTD
Deliveries YTD
Under Constr
Avg Rent (FSG)
Class A
14,019,022
22.6%
1.3%
3,360,729
24.0%
23.8%
(21,943)
(15,786)
60,000
1,009,103
$30.91
DOWNTOWN
Class B
5,558,052
10.4%
0.0%
576,086
10.4%
10.3%
(2,170)
21,553
-
66,318
$29.85
Class C
2,122,627
17.2%
0.0%
364,875
17.2%
16.3%
(19,551)
(1,097)
-
-
$21.40
Total
21,699,701
19.0%
0.9%
4,301,690
19.8%
19.6%
(43,664)
4,670
60,000
1,075,421
$30.74
RECENT DOWNTOWN LEASES Tenant
Property
Landlord
SF
Lease Type
YKK
101 Marietta St
Dilweg
20,060
New Lease
DRB Builders
55 Allen Plaza
Lone Star Funds
17,080
New Lease
233 Peachtree St
Banyan Street Capital
11,815
New Lease
Federal Trade Commission
RECENT DOWNTOWN INVESTMENT SALES Property
Price
SF
$/SF
Date
Buyer
Bank of America Plaza
$380,000,000
1,351,586
$281
3/1/2022
CP Group
250 Williams St
$285,000,000
1,589,465
$179
7/22/2021
Mapletree
100 Edgewood
$29,560,000
306,000
$96
6/30/2022
Atlantic Companies
ACTIVE DOWNTOWN UNDER CONSTRUCTION PROJECTS
760 Ralph McGill
Science Square Labs
Waldo’s
475,000 SF | Sep 2022
364,871 | Mar 2024
118,882 | May 2023
New City Properties
Georgia Tech / Trammell Crow
Lucror Resources
Source: CoStar, LPC Research
lpcsoutheast.com The information contained herein has been obtained from the owner of the property or from a source deemed reliable. While Lincoln Property Company has no reason to doubt its accuracy, we do not guarantee it.
ATLANTA OFFICE REPORT | DOWNTOWN SUBMARKET Q2 2022
IN THE MARKET • Science Square Labs breaks ground: Set to deliver in 2024, a joint life sciences venture from Georgia Tech and Trammell Crow has broken ground in Downtown Atlanta. Located at the intersection of Northside Dr and Cameron M Alexander Blvd, Science Square Labs will bring 360,000 square feet of life sciences space to the Atlanta market. • CNN Center sells for over $144 million: In the largest Downtown transaction since 2016, CP Group has purchased the iconic CNN Center for $144,800,000. The state of Georgia sold the ground lease for the property to AT&T, which enabled the telecom giant to sell the mixed-use center to Florida-based CP Group. The CNN Center boasts 246,000 square feet of retail space and is located near State Farm Arena, Mercedes-Benz Stadium, and the future Gulch development. • Technology-driven mixed use development planned for South Downtown: Urbantec Development Partners plans to transform 10 acres of land into a mixed use development called Forge Atlanta. They plan to make the project at Ted Turner Drive and Whitehall Street a hub for life sciences in Atlanta.
Science Square Labs
CNN Center
Lincoln Property Company Atlanta tracks Class A, B, and C office buildings that are 10,000 square feet or greater, and excludes owner occupied, medical, and government buildings.
Lincoln Downtown Listings
55 Allen Plaza 55 Ivan Allen Boulevard NE 2,500 SF - 56,000 SF Hunter Henritze / Michael Howell Caroline Fisher
Need More Market Intel?
Spencer Papciak Research Manager 678.498.7676 spapciak@lpc.com
Lincoln Property Company Southeast 3405 Piedmont Road, Suite 450 Atlanta, GA 30305 404 266 7600
About LPC SE: Lincoln Property Southeast is a commercial real estate firm offering a comprehensive suite of value-added services for our clients. With our substantial local presence and history in the Southeast region, we are ideally situated to provide a superior service, which comes from knowing the goals and challenges faced by our clientele: tenants, investors, lenders and owners of commercial real estate. Our people and our philosophy are the key ingredients for Lincoln’s solid track record of success. The information contained herein has been obtained from the owner of the property or from a source deemed reliable. While Lincoln Property Company has no reason to doubt its accuracy, we do not guarantee it.
lpcsoutheast.com