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Home , 1100 Peachtree, 1180 Peachtree, 171 17th Street, Colony Square, Midtown Union

Offi ce Submarket Report | MIDTOWN Q2 2019

Key Takeaways Market Indicators Midtown Midtown > Midtown continued posting strong absorption gains, fi lling over Relative to prior period Q2 2019 Q3 2019* 100,000 square feet for the third consecutive quarter. Q2’s net VACANCY total absorption was 158,355 square feet. NET ABSORPTION > Move-ins by WeWork, Sirius XM, and Google were the largest to take place in the submarket this quarter. Together they accounted CONSTRUCTION for practically all of the absorption here. RENTAL RATE > Despite the positive gains, Midtown’s vacancy rate increased almost a full percentage point between quarters. This is solely *Projected due to the delivery of 725 Ponce which added 365,000 square feet of vacant space. Almost half of this vacancy will be occupied by the end of the year. Summary Statistics All Midtown Offi ce Market Classes Class A Class B > Midtown dominated the Atlanta offi ce market in leasing this quarter with three signifi cant preleases. Construction of these Total Inventory (Millions Square Feet) 25.3 19.3 5.1 projects should begin in the coming quarters. > Activity in Midtown remains robust. The only concern is the amount Vacancy Rate 12.3% 14.7% 4.1% of new supply anticipated to hit the submarket in the near future. Change From Q1 2019 0.9% 1.1% -0.4% Absorption, Deliveries and Vacancy Absorption YTD 800,000 13% 288 299 18 (Thousands Square Feet) 12% 600,000 Construction Deliveries YTD 11% 1.1 1.1 - 400,000 (Millions Square Feet)

Square Feet 10% Under Construction 200,000 3.6 3.5 0.1 9% (Millions Square Feet) 0 8% (200,000) 2Q18 3Q18 4Q18 1Q19 2Q19 Asking Rents 7% Per Square Foot Per Year (400,000) 6% Average Quoted $37.90 $38.83 $27.83 Absorption Deliveries Vacancy Change From Q1 2019 6.7% 6.6% 0.5% UPDATE - Recent Transactions in the Market Notable Leasing Activity

TENANT PROPERTY LANDLORD SIZE (SF) TYPE

Invesco MetLife 300,000 Class A Prelease Anthem 712 West Peachtree Portman Holdings 275,000 Class A Prelease BlackRock 725 Ponce New City, LLC 131,656 Class A Lease Jones Day 500 Lva Atlanta Colony Square 115,896 Class A Prelease Notable Sales Activity

PROPERTY SALES DATE SALE PRICE SIZE (SF) PRICE / SF BUYER

171 17th Street July 2019 $177,000,000 510,268 $346.88 Prime US REIT 1200 Peachtree St. 3/4/2019 $82,000,000 370,000 $221.62 Cousins Properties 1447 Peachtree St. 6/24/2019 $24,800,000 116,946 $212.06 Silver Spirit Global LLC 881 Peachtree St. 5/17/2019 $17,657,510 51,516 $342.76 The Loudermilk Companies

Sources: CoStar Property, Colliers Research Skyline Review

Space Available Direct Sublet

50

45

40

35

30

Floors 25

20

15

10

5

BUILDING One Atlantic 1075 Peachtree Promenade Center RBA 1,100,312 SF 690,835 SF 762,804 SF 774,535 SF 553,778 SF TYPICAL FLOOR SIZE 23,500 SF 22,130 SF 26,000 SF 24,630 SF 22,575 SF % LEASED 93.7% 94% 94% 91.4% 99.4% LARGEST SPACE AVAIL. 44,403 SF 34,714 SF 21,333 SF 93,332 SF 22,574 SF RENTAL RATE PER SF (Gross) $43.50-$44.50 $46.00-$48.00 $41.00-$43.00 $39.50-$41.00 $38.50 12345

7 10 3 5 8 5 2 6 9 6 8 4 11

1 2 3 1 9 10 12 3

4

1 5 2 4 7

2 Offi ce Submarket Report | Q2 2019 | Midtown | Colliers International - Atlanta Active Projects

1

Source: CoStar Property

NORFOLK SOUTHERN HQ 750,000 SF Offi ce Under Construction Developer: Cousins Properties 2

1105 W. PEACHTREE 664,184 SF Offi ce Space Under Construction Developer: Selig Enterprises 3 271 17th Street The Proscenium Regions Plaza Campanile

621,946 SF 541,789 SF 533,135 SF 502,846 SF 505,000 SF

22,995 SF 26,252 SF 25,000 SF 20,816 SF 23,857 SF

89.1% 89.4% 97% 97.3% 38.3% ANTHEM PHASE I 22,180 SF 26,678 SF 64,983 SF 22,454 SF 202,332 SF 352,000 SF Offi ce Under Construction $36.00-$40.00 $41.00-$43.00 $41.00-$43.00 $39.00-$44.00 $38.00-$42.00 Developer: Portman Holdings 6789104 Aerial Legend Points of Interest

1 Tech 7 Colony Square T3 232,141 SF Creative Offi ce 2 8 Federal Reserve Under Construction Buildings by Number Developer: Hines (see opposite page) Center for 3 9 Puppetry Arts House & Museum 5 MARTA Rail Line Savannah College Technology 4 10 New Construction of Art & Design Square

5 11 The Fox Theater ATLANTA YARDS 523,511 SF Offi ce Brick-and-Mortar Loft-Offi ce Woodruff Arts 6 12 Under Construction Center Developer: Hines

3 Offi ce Submarket Report | Q2 2019 | Midtown | Colliers International - Atlanta In The News > Jones Day Signs for 115,000 SF in Colony Square Redevelopment: Situated at 15th and Peachtree, FOR MORE INFORMATION the 10th largest law fi rm in Atlanta is moving to a new six-story building located at Colony Square. Scott Amoson Jones Day will anchor a $400 million development headed by North American Properties. The fi rm, VP, Director of Research | Atlanta looking to keep up with the ever-changing offi ce culture and workforce demands, will be occupying the +1 404 877 9286 entire Building 500, which is within walking distance to MARTA; a crucial piece of the puzzle for the [email protected] company’s move. The building will also be located adjacent to an incoming food hall currently under construction at Colony Square. Jones Day plans to occupy the new space in the Summer of 2021. The company will remain in their northern Midtown location at Pershing Park Plaza until completion. COLLIERS INTERNATIONAL > Invesco to double workforce, move HQ to Midtown Union: Asset management giant Invesco has ATLANTA OFFICE SPECIALISTS chosen to expand its Atlanta headquarters with a move to Midtown Union, an 8.5-acre mixed use development at 17th Street and West Peachtree. Planning to double its current workforce of 550 and Allison Bittel Paul Reese invest $70 million, Invesco will anchor the new 26-story tower on the north side of Midtown. Midtown Frank Cannon Morgan Reynolds Union is leading the charge on the north edge of the submarket as developers aim to transform the Scott DeMyer Emily Richardson area into a denser, more walkable area much like Tech Square to the south. Invesco will remain at Two Jessica Doyle Jodi Selvey Peachtree Pointe until the development is complete. Lee Evans Fred Sheats Deming Fish Pete Shelton AT A GLANCE | NORFOLK SOUTHERN HQ > Norfolk Southern relocating corporate Josh Gregory Hayes Swann headquarters from north Virginia to the Russ Jobson Will Tyler $575 million Midtown headquarters. Jeff Kelley Andrew Waguespack > Campus to feature two 22-story towers, Dany Koe Andrew Walker containing a total of 1-million square feet. It Eric Kulbacki Bob Ward will include a street-side cafe, outdoor plaza, Drew Levine Tiff any Wein terraces along West Peachtree, a garden, and Michael Lipton Stewart Yates day care center. > Cousins Properties is developing the complex located at 650 West . > Delivery is anticipated Third Quarter 2021.

Colliers International | Atlanta Offi ce | Midtown Listings

1447 PEACHTREE 75 5TH STREET 1,077-3,814 SF Lease 5,452-14,884 SF Lease Will Tyler / Paul Reese Scott DeMyer

400 BISHOP STREET ONE ATLANTIC CTR. 130,000 SF Lease 4,456 SF Sublease Scott DeMyer / Drew Levine / Will Tyler Tiff any Wein

Colliers International | Atlanta Promenade | Suite 800 1230 Peachtree Street, NE Atlanta, Georgia, 30309 Copyright © 2019 Colliers International. +1 404 888 9000 The information contained herein has been obtained from sources deemed reliable. While colliers.com/atlanta every reasonable eff ort has been made to ensure its accuracy, we cannot guarantee it. No responsibility is assumed for any inaccuracies. Readers are encouraged to consult their professional4 advisorsNorth priorAmerican to acting onResearch any of the material & Forecast contained Report in this report. | Q4 2014 | Offi ce Market Outlook | Colliers International