ATLANTA OFFICE REPORT
Downtown Submarket
Q3 2022
Positive Q3 for Downtown Amid Delivery of New Supply
1.8% rise in vacancy year-todate 22.0%
ABSORPTION AND VACANCY RATE
• Downtown Atlanta saw positive absorption of 99,712 square feet in Q3 of 2022. This was Downtown Atlanta’s second positive quarter this year, bringing the year-to-date absorption to positive absorption of 104,382 square feet.
150,000 100,000
20.0%
50,000 0
18.0%
‐50,000
• Despite the positive absorption figure, Downtown’s vacancy rate rose 160 basis points (1.6%). This was mostly thanks to the vacant delivery of Fourth Ward, a 475,000 square foot beltline-centric development. Fourth Ward is 68.4% leased to Mailchimp, who is not expected to occupy their space until Q4 of 2023.
‐100,000
16.0%
‐150,000
14.0%
‐200,000 ‐250,000
12.0%
‐300,000 ‐350,000
• The average asking rent across all property classes in Downtown has risen 9.2% since Q1 of 2022, with the average Class A rate hitting $31.47.
Q1 2021
Q3 2021
Q1 2022
Absorption
10.0%
Q3 2022
Vacancy Rate
Source: CoStar
Total Inventory SF
Direct Vacancy Rate
Sublease Vacancy Rate
Total Vacant SF
Vac Rate Q3 ‘22
Vac Rate Q2 ‘22
Net Absorp Q3 ‘22
Net Absorp YTD
Deliveries YTD
Under Constr
Avg Rent (FSG)
Class A
14,194,884
25.1%
0.6%
3,654,040
25.7%
23.6%
96,264
80,478
585,350
619,871
$31.47
DOWNTOWN
Class B
5,583,218
10.6%
0.2%
604,760
10.8%
10.4%
4,644
26,197
33,318
33,000
$27.07
Class C
2,132,687
17.2%
0.0%
366,071
17.2%
17.1%
(1,196)
(2,293)
-
-
$21.40
Total
21,910,789
20.7%
0.4%
4,624,871
21.1%
19.5%
99,712
104,382
618,668
652,871
$31.14
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 Comission
RECENT DOWNTOWN INVESTMENT SALES Property Bank of America Plaza
Price
SF
$/SF
Date
Buyer
$380,000,000
1,351,586
$281
3/1/2022
CP Group
387 Technology Cir - Bldg 100
$85,250,000
126,760
$672
10/21/2022
Ancora Partners
100 Edgewood
$29,560,000
306,000
$96
6/30/2022
Atlantic Companies
ACTIVE DOWNTOWN UNDER CONSTRUCTION PROJECTS
Science Square Labs
Junction at Krog District
Waldo’s
364,871 | Oct 2024
136,000 | Jun 2023
118,882 | May 2023
Georgia Tech / Trammell Crow
Portman Holdings
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 Q3 2022
IN THE MARKET • Peachtree Center foreclosure: Banyan Street Capital was unable to work out a debt restructuring deal resulting in Peachtree Center going back to the lender. SitusAMC, who represented the lender, entered a $127.5 million credit bid on the property. The buildings include Marquis I and II, as well as 231, 225, 229, 233 and 235 Peachtree St. • 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.
Peachtree Center
• 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. • 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.
Science Square Labs
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 - 34,909 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