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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 Q3 2010 Atlanta Office Market Report.
Buckhead surges while the rest of the Atlanta office market continues to struggle.
Monday, October 11, 2010
The Atlanta office market closed the third quarter of 2010 with 10,451 square feet of positive absorption. Year-to-date absorption is now at a negative 422,535 square feet following the second quarter’s 447,140 square feet of negative absorption and a first quarter positive absorption figure of 14,154 square feet. Although the amounts are trivial, two of the first three quarters of 2010 have been positive, perhaps an early indication of a healthy recovery ahead.
The overall average rental rate of $21.29 per square foot continued a downward trend, falling six consecutive quarter from $21.69 per square foot in the first quarter of 2009. Class A average office rates of $23.88 per square foot this quarter dropped 13 cents on average from $24.01 during the previous quarter. Class B fell only 10 cents to $18.05 per square foot, while Class C took the hardest hit dropping 22 cents from $15.25 per square foot last quarter to $15.03 in the third quarter.
The urban corridor, which is about half the size of suburban market in terms of total existing square feet, considerably outperformed the suburbs during the third quarter. After five straight quarters of negative absorption, the urban corridor posted 352,508 square feet of third-quarter positive absorption while the suburbs counterbalanced with negative 342,057 square feet. Only six of the sixteen Atlanta submarkets recorded positive absorption figures. Buckhead/Lenox was the lone bright spot this quarter, accounting for 364,215 square feet of absorption. Following Buckhead was NE Expressway-South with 24,689 square feet and Downtown with 17,932 square feet of positive absorption.
Sony Ericcson officially made the move into over 40,000 square feet at the new Terminus 200 building while Novelis took occupancy of nearly 100,000 square feet at Two Alliance. Buckhead has been the focus of attention over the last six quarters with the hefty number of deliveries and the upsurge in the vacancy rate. After a successful quarter, its vacancy rate has dropped to 26.59 percent, down from 28.98 percent at mid-year to 2010.
Leading the quarter in negative absorption is the I-75/I-285 submarket, which is the second largest Atlanta submarket, with negative 153,891 square feet. Much of this can be attributed to First Data Corp. which officially vacated 124,000 square feet at Powers Ferry Landing East to consolidate in its new corporate headquarters at Glenridge Highlands II. The vacancy rate in I-75/I-285 is approaching 20 percent, up from 18.01 percent a year ago to 19.39 percent presently. Among the most consistent under-performing submarkets is GA-400 North with eight straight quarters of negative four-quarter cumulative absorption. Following closely is the I-285/GA-400 submarket with seven straight. These two submarkets posted third-quarter occupancy rates of 82.72 percent and 82.94 percent respectively.
Despite continued slow activity, the Atlanta office market could start to make a significant turn, particularly if the economy improves and job growth takes place. No new office development is on the horizon, and none is anticipated for at least several years.With the fact over 150,000 office workers in the Metro Atlanta region have lost their jobs, there could be significant pent-up demand with an improved economy.
Data provided
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