1q 2012 | northwest atlanta office | market report
DESCRIPTION
Colliers International | Atlanta 1Q 2012 report for the Northwest office marketTRANSCRIPT
NEW SUPPLY, ABSORPTION AND VACANCY RATES
SUBMARKET REPORTATLANTA
www.colliers.com/atlanta
MARKET INDICATORS
Q1 2012 | NORTHWEST ATLANTA
Cum
berl
and
TRENDS & HIGHLIGHTS
12%
13%
14%
15%
16%
17%
18%
(80,000)(60,000)(40,000)(20,000)
020,00040,00060,00080,000
100,000
1Q11 2Q11 3Q11 4Q11 1Q12
Absorption Deliveries Vacancy
UPDATE Recent Transactions in the Market
SALES ACTIVITY
PROPERTY ADDRESS SALE PRICE SIZE SF PRICE / SF BUYER
Riverwood 100 $81,500,000 502,527 $162.18 Highwoods Properties4111 Northside Pkwy.-IBM $53,600,000 825,000 $64.97 Atlanta Public Schools355 Tower Rd. $10,450,000 55,000 $190 Wellstar Health System1090,1130 Northchase Pky. $7,700,000 165,205 $46.61 Crossgate Partners
LEASING ACTIVITY
TENANT PROPERTY ADDRESS SIZE SF TYPE
Travelport 300 Galleria 150,000 Class A Renewal
Graphic Packaging RiverEdge Summit 109,556 Class A Lease
Gentiva Riverwood 100 60,000 Class A Renewal & Expansion
Silverpop Systems 200 Galleria 22,822 Class A Expansion
• The Cumberland offi ce market saw modest negative absorption in the fi rst quarter following two consecutive quarters of occupancy gains. The increase in vacancy can be traced to tenant consolidations within the submarket and also a few tenant relocations to neighboring submarkets.
• Activity in the Cumberland offi ce market is lackluster, yet balanced. The area is seeing a mixed bag of both tenant vacancies, space renewals and new leasing. This submarket, however, has lagged behind competing markets such as Buckhead and Central Perimeter which are winning the majority of the larger leasing requirements.
• Not much is expected to change for the submarket’s offi ce market over the next few months. Nevertheless, Cumberland remains one of the most viable options to tenants seeking offi ce space.
Squa
re F
eet
Source: CoStar Property, Colliers Research
Q1 2012Projected
Q2 2012
VACANCY
NET ABSORPTION
CONSTRUCTION — —
RENTAL RATE —
Total SF 27,307,866
Vacancy Rate 17.2%
YTD Net Absorption (59,442)
YTD Deliveries 0
Under Construction 0
Avg. Class A Rate $21.33
SKYLINE REVIEW
35
30
25
20
15
10
5
Space Available Direct Sublet
Flo
ors
BUILDING Riverwood 100 Overlook III 200 Galleria 400 Galleria CumberlandCenter II
RBA 502,527 SF 438,709 SF 438,273 SF 440,000 SF 413,247 SF
TYPICALFLOOR SIZE 21,889 SF 26,000 SF 22,000 SF 23,157 SF 24,308 SF
% LEASED 90.2% 85.5% 74% 86.7% 84.3%
LARGESTSPACE AVAIL. 24,931 SF 38,512 SF 23,094 SF 24,586 SF 49,500 SF
RENTAL RATEPER SF (Gross) $24.50 $23.50-$24.50 $17.00-$21.00 $24.50 $22.50
1 2 3 4 5
BUILDING One Paces West Two Paces West Platinum Tower The Towers at Wildwood Plaza
RBA 274,948 SF 371,523 SF 312,591 SF 706,307 SF
TYPICALFLOOR SIZE 22,000 SF 20,640 SF 21,000 SF 43,362 SF
% LEASED 85.8% 82.3% 86.9% 88.7%
LARGESTSPACE AVAIL. 34,253 SF 20,734 SF 11,186 SF 25,341 SF
RENTAL RATEPER SF (Gross) $21.00-$21.50 $21.00-$21.50 $22.50 $19.75-$23.00
6 7 8 9
Source: CoStar Property
35
30
25
20
15
10
5
Flo
ors
P. 2 | COLLIERS INTERNATIONAL
MARKET REPORT | Q1 2012 | ATLANTA OFFICE | NORTHWEST ATLANTA
AERIAL LEGEND
POINTS OF INTEREST
1
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Cumberland Mall
Galleria Mall
Cobb Energy
Arts Centre
Chattahoochee
Recreation Center
Dobbins Air Base
Vinings Area
PLANNED CONSTRUCTION
Buildings by Numbers (see opposite page)
New Construction
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6 7
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4
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RIVERWOOD PROJECT$300M project530,000 SF Class A offi ce90,000 SF retail400 residential units200 room hotelDeveloper: Seven Oaks Co.
555 GALLERIA250,000-300,000 SFClass A Build-To-SuitConstruction contigent upon leasingDeveloper: Childress Klein
1
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MARKET REPORT | Q1 2012 | ATLANTA OFFICE | NORTHWEST ATLANTA
COLLIERS INTERNATIONAL | P. 3
COLLIERS INTERNATIONAL
ATLANTA OFFICE SPECIALISTS:
www.colliers.com/atlanta
Accelerating success.
IN THE NEWS
• Gentiva expansion smaller than expected: Gentiva Health Services recently signed a renewal & expansion totaling 60,000 square feet at Riverwood 100. The amount of the expansion totals about 7,000 square feet. Back in 2011, the company was reported seeking almost 65,000 square feet for expansion, following an acquisition of Odyssey Healthcare in Dallas, TX and possibly adding 100 jobs. The new lease, however, does not include these additional jobs and for the time being it appears the smaller expansion will suit the company’s short-term needs.
• Cobb County nabs over two dozen major projects in 2011: The economic development teams in Cobb County and the Cumberland Community Improvement District were busy securing new business in 2011. The area attracted over two dozen major projects in the last twelve months. The most recent win was the announcement of Home Depot choosing Cobb for a new customer support call center which will bring 700 jobs to the county. Other big wins in the year were Osmotica Pharmaceutical Corp. investing $20 million in a manufacturing and R&D facility in Marietta, Novelis choosing the Kennesaw area for a new research and development center, and CCH Small Firm Services choosing to bring 200 employees from outside the state to its Kennesaw operation. Business leaders hope these accomplishments will provide momentum going forward into 2012 as they target specifi c industry clusters such as aerospace, business & professional services, supply-chain logistics and information technology.
Accelerating success.
COLLIERS INTERNATIONAL | ATLANTA OFFICE | NORTHWEST ATLANTA LISTINGS
GALLERIA 600
14,200 SF SubleasePete Shelton
955 COBB PLACE BLVD.
10,731 SF LeaseAndrew Walker
JONQUIL VILLAGE
10,376-20,752 SF LeaseAndrew Walker
NEWMARKET BUSINESS PARK
1,060-4,653 SF LeaseLee Evans / Scott O’Halloran
PROF. BLDGS. @WOODSTOCK
Bldg. 97019,311 SF For Sale
Andrew Walker / Craig Mendel
OVERLOOK III
11,184 SF SubleaseAndrew Walker
10%
11%
12%
13%
14%
15%
16%
17%
18%
(40,000)(20,000)
020,00040,00060,00080,000
100,000120,000140,000
1Q11 2Q11 3Q11 4Q11 1Q12
Absorption Deliveries Vacancy
Total SF 8,608,157
Vacancy Rate 15.3%
YTD Net Absorption 32,161
YTD Deliveries 0
Under Construction 16,650
Avg. RentalRate $16.06
KENNESAW | MARIETTA | CHEROKEE CO. Offi ce Market Stats
Squa
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eet
UNITED STATES:
Colliers InternationalTwo Midtown Plaza | Suite 11001349 West Peachtree Street, NEAtlanta, Georgia, 30309TEL +1 404 888 9000FAX +1 404 870 2845
Source: CoStar Property, Colliers Research
This market report is a research document of Colliers International. Information herein has been deemed reliable and no representation is made as to the accuracy thereof. Colliers International-Atlanta, Inc., and certain of its subsidiaries, is an independently owned and operated business and a member fi rm of Colliers International Property Consultants, an affi liation of independent companies with over 520 offi ces throughout 62 countries worldwide.
522 offi ces in 62 countries on 6 continentsUnited States: 147Canada: 37Latin America: 19Asia Pacifi c: 201EMEA: 118
• $1.8 billion in annual revenue
• Over 2.5 billion square feet under management
• Over 12,000 professionals
Bob Allen Bob Mathews
Jill Bomar Craig Mendel
Lee Evans Scott O’Halloran
Deming Fish Hugh Paff ord
Huston Green Jodi Selvey
Tim Huff man Fred Sheats
Russ Jobson Pete Shelton
Jeff Kelley Hayes Swann
Drew Lavine Will Tyler
Michael Lipton Andrew Walker
Nicole Littleton Bob Ward
MARKET REPORT | Q1 2012 | ATLANTA OFFICE | NORTHWEST ATLANTA