North Fulton Sublease Availability Continues to Climb
• Despite recording 83,443 square feet of positive absorption this quarter, North Fulton remained negative for the year with an overall absorption of -191,593 square feet. A large portion of this absorption occurred in the form of subleasing with almost 65,000 square feet of space occupied.
• North Fulton vacancy declined this quarter by 20 basis points to a rate of 22.6%. This drop in vacancy can largely be attributed to the 52,006 square foot move in of SK Battery at Stonebridge I. However, despite SK Battery subleasing this space, sublease availability continued to climb to an all-time high of 5.8%.
• Tenants choosing to sublease space in the North Fulton submarket receive an average discount of 26.1% on lease asking rates.
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
Tenant Property Landlord SF Lease Type SK Battery Stonebridge I Starwood Real Estate Income Trust, Inc. 52,006 Sublease Best Claims Group Royal 400 Research Management Corporation 34,642 New Lease Kaleris Preston Ridge III Hobbs Brook Real Estate LLC 26,285 New Lease TOP NORTH FULTON LEASES Q4 2022 12% 14% 16% 18% 20% 22% 24% ‐400,000 ‐300,000 ‐200,000 ‐100,000 0 100,000 200,000 300,000 400,000 Q2 2021 Q4 2021 Q2 2022 Q4 2022 Absorption Vacancy Rate 12655 Birmingham Hwy 1037 Alpharetta Street Bldg 2 Halycon 3000 67,500 SF | May 2023 47,993 SF | Jul 2023 21,000 SF | Oct 2023 Market District Development Armada Hoffler Properties, Inc. RocaPoint Partners NORTH FULTON Total Inventory SF Direct Vacancy Rate Sublease Vacancy Rate Total Vacant SF Vac Rate Current Vac Rate Current Net Absorp Q4 ‘22 Net Absorp YTD Deliveries Under Constr Avg Rent (FSG) Class A 13,412,979 24.1% 2.2% 3,537,083 26.4% 26.5% 32,105 (136,951) 22,070 210,000 $28.11 Class B 9,906,275 15.6% 3.7% 1,914,373 19.3% 19.9% 54,153 (48,049) - 87,500 $22.18 Class C 975,626 3.4% 0.0% 32,711 3.4% 3.1% (2,815) (6,593) - - $20.29 Total 24,294,880 19.8% 2.7% 5,484,167 22.6% 22.8% 83,443 (191,593) 22,070 297,500 $26.10 ACTIVE NORTH FULTON UNDER CONSTRUCTION PROJECTS Property Price SF $/SF Date Buyer Windward Chase $48,200,000 401,470 $120 2/1/2022 RealOp Investments 11315 Johns Creek Pky $31,591,828 96,357 $327 10/6/2022 Anchor Health Properties Mansell Three $19,719,255 126,140 $156 4/20/2022 The Simpson Organization RECENT NORTH FULTON INVESTMENT SALES 0.5% rise in vacancy over
12 months ABSORPTION AND VACANCY RATE Source: CoStar Source: CoStar, LPC Research
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ATLANTA OFFICE REPORT
Q4 2022
• Details finalized for Alpha Loop extension at Northwinds: Alpha Loop, the 8-mile greenway trail set to encircle Alpharetta, will connect the Northwinds office campus with a $15.2 million extension. The 1-mile-long path will feature a 360-foot-long bridge and 144-foot-long tunnel beneath Westside Parkway. Alpha Loop will connect Avalon and Downtown Alpharetta to North Point Mall and the Big Creek Greenway, another trail system stretching from Roswell to Forsyth.
• Avalon developer turning attention to former State Farm campus: Mark Toro, the developer of Alpharetta’s Avalon, has set his sights on a new project at the corner of McGinnis Ferry Road and Johns Creek Parkway. The former State Farm campus in Johns Creek is set for a $350 million redevelopment that would include retail, housing, and dining elements.
• First office phase at Forsyth’s Halcyon is fully leased: Halcyon has fully leased their 150,000 square foot office component. Opened in 2019, Halcyon boasts a mixed-use “live, work, play” environment.
Lincoln North Fulton Listings
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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.
Lincoln Property Company Southeast 3405 Piedmont Road, Suite 450 Atlanta, GA 30305 404 266 7600
404.689.3216
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. IN THE MARKET ATLANTA OFFICE REPORT | NORTH FULTON SUBMARKET Q4 2022
Nathan Bell Research Manager
nbell@lpc.com
Northwinds Office Park Park at Windward Concourse 2475, 2520, 2500, 2550 Northwinds Pky 11065 Haynes Bridge Rd 11625 & 11675 Rainwater Dr 1720 Windward Concourse & 1725 Windward Concourse 1,000 SF - 35,000 SF 1,000 SF - 8,000 SF Hunter Henritze / Caroline Fisher Michael Howell / Robert Degolian Matt Fergus / Seabie Hickson Michael Howell
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.
Northwinds
The Quad at Johns Creek