News
GOODBYE GOVERNMENT?
July 20, 2011
| The calls for federal government spending cutbacks could have a hugely negative effect on Atlanta's office market—especially if it means the government reduces its corporate footprint. (Though all the heart attacks from that news should be a boon for Medicare.) | |
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| A recent report drafted by Montgomery Financial Services' principal Bona Allen (who recently left NYLO Hotels and is seen here at a recent Bisnow event) says the US government owns or leases 8M SF of office in metro Atlanta and another 2M SF throughout the state, giving Georgia the fifth largest concentration of Fed offices in the US. And a recent White House mandate to reduce the real estate footprint of the government (possibly including consolidations) across the board could have a huge impact for the metro office community, especially with more than 4.5M SF in leases expiring between now and 2014. ?The Atlanta domino could be one of the first and hardest to fall,? Bona says. Given the current debate on our debt, Bona says the government will almost be forced to cut back its CRE holdings. ?We may not have seen cuts like this before.? | |
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| John Connor, of corporate turn-around firm ABTV, commissioned Bona's report and says the impact of the federal government means that any cutbacks could keep metro landlords bleeding absorption until 2015. And as Congress considers all the cuts, John says he hopes lawmakers remember the human element—namely the jobs that could be lost in metro Atlanta. ?We just hope the Atlanta region will be treated fairly in the broad scope.? |
