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Publications
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Press Releases
Throughout the year as different, noteworthy events occur at Richard Bowers & Co, we would like to keep you informed. Listed below are our Quarterly press releases along with any supplemental releases containing vital information about the happenings at Richard Bowers & Co.
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Richard Bowers & Co. Releases its Second Quarter 2010 Office Market Report
First signs of positive absorption suggests a bottoming-out of the office market
Atlanta office market remains positive despite negative absorption
Wednesday, July 7, 2010
Second Quarter 2010 Summary - Following five straight quarters of negative absorption,
2010 began favorably with its first quarter positive absorption figure restoring a sense of optimism for the remainder of the
year. Second quarter absorption, however, was back in the red with 295,668 square feet of negative absorption resulting
in 242,142 square feet of negative absorption through mid-year. Overall vacancy rates have increased to 19.68 percent, up
0.21 percentage points from the first quarter of 2010 and 2.46 percentage points from this time a year ago. This marks the
highest vacancy rate the city has seen in more than two decades, dating back to the 1980s. Average rental rates continue
on a downward trend despite having 1,640,816 square feet of trophy class “A” space delivered during the first quarter.
Average rental rates decreased from $21.65 per square foot at mid-year 2009 to $21.42 at mid-year 2010.
Although both the urban and suburban markets posted negative absorption in the second quarter, the urban corridor
continued to outperform the suburbs with 100,946 square feet of negative absorption, compared to the suburbs at 194,722
square feet of negative absorption. Only three of the sixteen Atlanta submarkets posted positive absorption in the
second quarter, two of which were in the urban corridor: Buckhead with 52,496 square feet and Downtown with 43,663
square feet. Most of Midtown’s 197,105 square feet of negative absorption can be attributed to the AT&T sublet space
in Promenade II that returned to direct, leasable space. This change accounted for 66 percent of the overall negative
absorption in the second quarter and would have put the urban corridor into positive absorption numbers if AT&T’s lease
had not expired.
Buckhead, which has delivered nearly 3 million square feet since 2007, currently has the most available square feet of any
submarket with 4,384,685 square feet and also has the highest average rental rate of all submarkets at $26.18 per square
foot. Midtown follows with an average rate of $25.98. Downtown remains the most ffordable option in the urban
corridor with an average rental rate of $21.58 per square foot.
With close to 3 million square feet delivered during the past year and the overall average vacancy rate approaching 20
percent, new construction has been brought to a standstill. Over time, this lack of new construction will allow the Atlanta
office market to catch up and fill this abundance of empty space. Atlanta remains one of the fastest-growing cities in the
country and has attracted several Fortune 500 companies recently. Our outlook for the remainder of the year is optimistic
with positive absorption and a reduction in vacancy rates.
Data provided
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