Office Market On Steady Course Into 2019

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Key Takeaways

  • A better than expected Q4 brought the year-to-date absorption total of Atlanta’s office market to just under 1.4 million square feet. This marks the third consecutive year with more than 1 million square feet absorbed in the market.
  • The largest occupancies this year came mostly from new headquarter move-ins including NCR (726,000 SF), Mercedes- Benz (225,000 SF), HD Supply (222,000 SF), and Westrock (146,718 SF). All together, these expansions accounted for half of the metro area’s net absorption total in 2018.
  • Atlanta’s office vacancy rate increased slightly year-over-year; up 20 basis points (0.2%) from 2017. This is a result of delivered product exceeding absorption in the year.
  • Just over 2 million square feet in 15 office projects broke ground this year. The largest of these was Twelve24 (335,000 SF) in Central Perimeter. Midtown and North Fulton saw the most construction starts in 2018 at three each.
  • All indications point to another solid year of activity for Atlanta’s office market in 2019; however, creeping pressures facing the economy could incite uncertainty and aff ect leasing levels in the latter half of the year.

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Atlanta Office Market

Similar to Year-End 2017, the Atlanta office market finished the year with a strong fourth quarter leading to annual absorption topping 1.2 million square feet for a third consecutive time. 2018 was highlighted by a number of new headquarters expansions including NCR, Mercedes-Benz, HD Supply, and Westrock. These were among the largest office occupancies in the Atlanta market and accounted for half of the metro area’s net absorption total. Most of the remaining occupancy gains this year were a result of company expansions; a sign of the continued economic growth shaping the market. Even so, activity could have been much higher.


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Office Market On Steady Course Into 2019

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