NO SPECS (NO KIDDING)
|It's hard to believe, but Atlanta currently has no spec office space under construction—none—according to a just-released report from Cushman & Wakefield.|
Atlanta's Central Perimeter and Northeast office markets don't have the cache of Midtown or Buckhead, but they have something else:positive net absorption. In fact, they performed well enough to lead Atlanta to a quarter of positive net absorption (39K SF) for the first time in several quarters. And leasing volume jumped 10%. But metro?s overall vacancy rate increased to 21.2%. The Central Perimeter market outperformed in the first quarter and chalked up 280K SF of absorption, the report says (Autotrader.com?s lease at Perimeter Summit helped). At the other end, Buckhead was a big loser with 136K SF of negative net absorption during the first quarter. It's attracted national attention for overbuilding, and now the final two towers of the current cycle are completed; we snapped one of them above: 3630 Peachtree. Of course boosters point out you can't catch the big fish without having the space available!
This morning, we snapped the quarter?s largest office delivery, 1075 Peachtree at 12th & Midtown, likely the last spec office developed in Midtown for a couple years. The gleaming new 725K SF will soon welcome law firm Seyfarth Shaw. But Midtown finished the first quarter with negative net absorption of 44K SF, according to Cushman. Currently, the only office space under construction in the entire metro area is a 60K SF build-to-suit in North Fulton for education accreditation firm AdvancED. It's hard to remember the last time Atlanta, where barriers to entry are few, had less than 100K SF of office space under construction. On the bright side: This shutdown of the spec office construction pipeline should help Atlanta's absorption numbers throughout the year.