Office Submarket Report
ATLANTA | CENTRAL PERIMETER
Q4 2015
Key Takeaways
Market Indicators
> Central Perimeter absorbed the highest amount of office space
in the fourth quarter leading the Atlanta market once again. The
positive absorption came from numerous move-ins with Focus
Brands’ occupancy at MidCity Plaza being the largest.
Relative to prior period
Central Perimeter
Q4 2015
Central Perimeter
Q1 2016*
VACANCY
-
NET ABSORPTION
> The submarket also saw the highest amount of office absorbed in
the year. This is the 4th straight year Central Perimeter has seen
a net occupancy gain and also led the Atlanta market.
CONSTRUCTION
> The average vacancy rate in Central Perimeter is at its lowest point
in 15 years. Class A vacant space currently totals 1.9 million sq.
ft. which is the lowest it has been since the 4th quarter of 2000.
*Projected
> Central Perimeter’s average quoted rental rate increased 7.5%
year-over-year. It is currently at its highest amount ever in the
submarket’s history.
Summary Statistics
RENTAL RATE
Central Perimeter Office Market
Total Inventory
(Millions Square Feet)
All
Classes
Class A
Class B
29.5
20.8
7.3
> Activity will continue to be strong in Central Perimeter. The
submarket is expected to see a lot of positive growth in 2016.
Vacancy Rate
12.5%
9.2%
20.7%
Absorption, Deliveries and Vacancy
Change From Q3 2015
-0.9%
-1.1%
-0.6%
888
788
110
578
578
-
617
602
15
$23.78
$27.07
$20.60
1.4%
0.6%
2.0%
Square Feet
800,000
16%
Absorption YTD
(Thousands Square Feet)
600,000
14%
400,000
Construction Deliveries YTD
(Thousands Square Feet)
Under Construction
200,000
12%
0
(Millions Square Feet)
Asking Rents
(200,000)
10%
4Q14
1Q15
Absorption
2Q15
3Q15
Deliveries
Per Square Foot Per Year
4Q15
Average Quoted
Vacancy
Change From Q3 2015
UPDATE - Recent Transactions in the Market
Notable Leasing Activity
TENANT
PROPERTY
LANDLORD
SIZE (SF)
TYPE
eVestment Alliance
100 Glenridge Point Pkwy.
Pope & Land Enterprises
67,900
Class B Lease
Vmware
1155 Perimeter Center Pkwy.
Piedmont Office Realty Tr.
50,400
Class A Expansion
University of Phoenix
Northridge Plaza
Choate Construction Co.
38,736
Class A Renewal
GreenSky
Glenridge Highlands One
Piedmont Office Realty Tr.
35,000
Class A Lease
Notable Sales Activity
PROPERTY
SALES DATE
SALE PRICE
SIZE (SF)
7000 Central Pkwy.
11/6/2015
$85,300,000
415,324
$205.38
CBRE Global Investors Ltd
Glenridge Highlands One
11/24/2015
$63,561,619
290,0073
$219.12
Piedmont Office Realty Trust
Sterling Pointe
8/20/2015
$53,400,000
351,123
$152.08
The Simpson Organization/Harbert
6303 Barfield Rd./859 Mt. Vernon
11/19/2015
41,000,000
289,000
$141.87
Drawbridge Realty Trust
Sources: CoStar Property, Colliers Research
PRICE / SF
BUYER
Skyline Review
Space Available
Direct
Sublet 35
Source: CoStar Property
30
Floors
25
20
15
10
5
BUILDING
Concourse VI
Concourse V
Three Ravinia
1001 Summit Blvd.
Glenridge Highlands II
RBA
697,400 SF
687,107 SF
813,145 SF
572,643 SF
415,000 SF
TYPICAL
FLOOR SIZE
27,000 SF
26,719 SF
26,250 SF
24,262 SF
24,927 SF
% LEASED
92.7%
86.2%
98.7%
78.5%
98.1%
47,326 SF
25,432 SF
5,771 SF
68,710 SF
6,539 SF
$31.00-$32.50
$31.00-$32.50
$32.50
$32.00-$33.00
$29.50
1
2
3
4
5
7000 Central Park
400 Northpark
One Ravinia
Two Ravinia
One Glenlake
RBA
415,324 SF
586,256 SF
386,603 SF
407,292 SF
365,607 SF
TYPICAL
FLOOR SIZE
28,000 SF
24,000 SF
23,500 SF
22,695 SF
26,500 SF
% LEASED
82.4%
87.6%
93.8%
86.6%
73%
21,577 SF
23,368 SF
22,434 SF
22,288 SF
52,508 SF
$29.00
$28.00-$33.00
$27.50-$28.50
$27.50
$31.00
6
7
8
9
10
LARGEST
SPACE AVAIL.
RENTAL RATE
PER SF (Gross)
35
30
Floors
25
20
15
10
5
BUILDING
LARGEST
SPACE AVAIL.
RENTAL RATE
PER SF (Gross)
2
Office Submarket Report | Q4 2015 | Central Perimeter | Colliers International - Atlanta
4
3
7
10
2
1
5
6
1
8 9
3
1
2
4
6
5
2
3
4
5
6
Planned Construction
Aerial Legend
Buildings by Number
(see opposite page)
MARTA Rail Line
New Construction
Points of Interest
1 Perimeter Mall
4 Scottish Rite
2 Northside Hospital
5 Perimeter Place
3
St. Joseph’s
Hospital
3
6 Marist High School
1
100 NORTHPARK
Mixed-Use Project
1.5 million SF office
150,000 SF retail
500 multi-family units
250-room hotel
Planning Stage
Developer: Hines
4
MERECEDES-BENZ
US HEADQUARTERS
250,000 SF
Planning Stage
Delivering 2018
Architect: Gensler
2
3
ABERNATHY 400
700 NORTHPARK
550,000 SF
Planning Stage
Delivering TBD
Developer: Ackerman
484,000 SF office
Planning Stage
Delivering TBD
Developer: Hines
5
6
4004 & 9009 PERIMETER SUMMIT
400,000 SF (4004); 350,000 SF (9009)
Planning Stage
Developer: Seven Oaks
Office Submarket Report | Q4 2015 | Central Perimeter | Colliers International - Atlanta
In The News
> Massive project could ‘urbanize’ Perimeter Center: Owners of the former Gold Kist Foods
building off of Perimeter Center Parkway plan to transform the 15-acre parcel into a massive
mixed-use district containing high-rise office and residential towers. According to plans, the
project would be completed in phases with the first to include 9 acres of the project for two
24-story office towers and a 28-story hotel. The second phase would include the remaining
acreage to include two residential projects and another hotel. Plans are conceptual at this point
and going through the necessary approval, design and zoning processes.
FOR MORE INFORMATION
> Ambitious five-tower project planned for Sandy Springs: Korean investor Shik Hong who
recently purchased 1117 Perimeter Center West has filed plans with the city of Sandy Springs
to redevelop the property to include up to five office and residential towers. Like so many
proposed developments in the area, the ambitious project would connect to MARTA in order to
take advantage of the access to public transit. The model follows other projects taking place,
and those planned, which seek to urbanize the Central Perimeter area. Plans for 1117 Perimeter
Center West are still preliminary and currently in progress.
COLLIERS INTERNATIONAL
ATLANTA OFFICE SPECIALISTS
AT A GLANCE | 700 Northpark
> Class A, LEED-CS certified office tower
totaling 484,000 square feet including
15,000 square feet of street-level retail and
restaurants.
> To be fourth tower in Northpark office
development; located adjacent to Sandy
Springs MARTA station.
> Building in planning stage, but will likely be
Central Perimeter’s newest office building
since 2000.
Scott Amoson
VP, Director of Research | Atlanta
+1 404 877 9286
[email protected]
Monica Davis
Michael Lipton
Scott DeMyer
Bob Mathews
Lee Evans
Craig Mendel
Deming Fish
Scott O’Halloran
Chuck Francis
Paul Reese
Chris Goershel
Jodi Selvey
Huston Green
Fred Sheats
Josh Gregory
Pete Shelton
Tim Huffman
Hayes Swann
Russ Jobson
Jennifer Telleria
Jeff Kelley
Will Tyler
Dany Koe
Andrew Waguespack
Mike Lash
Andrew Walker
Drew Levine
Bob Ward
> Hines Interests is marketing and will develop
the project.
Colliers International | Atlanta Office | Central Perimeter Listings
900 ASHWOOD
986-26,028 SF Lease
Scott O’Halloran /
Lee Evans /
Deming Fish
THE POINTE - 500
4,008 SF Sublease
9,585 SF Sublease
Monica Davis /
Michael Lipton
5871 GLENRIDGE
1,095-8,977 SF Lease
Deming Fish /
Lee Evans /
Scott O’Halloran
6160 P’TREE DUNW
2,217 SF Lease
Fred Sheats
THREE RAVINIA
3,858 SF Sublease
Russ Jobson
Copyright © 2015 Colliers International.
The information contained herein has been obtained from sources deemed reliable. While
every reasonable effort has been made to ensure its accuracy, we cannot guarantee it. No
responsibility is assumed for any inaccuracies. Readers are encouraged to consult their
professional advisors prior to acting on any of the material contained in this report.
4
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North American Research & Forecast Report | Q4 2014 | Office Market Outlook | Colliers International