Developing Superior Retail Properties Throughout the South
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CITY HIGHLIGHTS ATLANTA CITY HIGHLIGHTS ATL A NT A OFFICE MA RKET or the first time in 30 years, not tion, there is nearly 1.9 million square Atlanta Plaza, contain blocks in excess residential and retail components, and Fa single office building greater feet of available sublease space. Net of 100,000 square feet. some speculative office space. than 50,000 square feet is being built absorption for the overall Atlanta While heavy concessions are start- For the remainder of 2012, we are on speculation in the Atlanta office office market was 520,046 square feet, ing to burn off, asking rates will tread guarded and expect that most of the market. There are several macro- CoStar reported. Despite this posi- along the bottom and not see signifi- activity will consist of vertical move- economic reasons for this but the tive data point, Atlanta office rents cant improvements until occupancy ment which will generate a minor principal cause is the relatively slow — which ended the first quarter of the levels rise considerably. amount of true net absorption — increase in employment. year at $18.36 per square foot — could In terms of leasing activity, Kids II around 500,000 square feet. Rajeev Dhawan, the director of Eco- not support new office developments. is moving into 105,818 square feet at The biggest upcoming issue in the nomic Forecasting Center at the J. Carrying over from the first quarter, Terminus 200 in Buckhead, while ACE community will be determined July Mack Robinson College of Business Atlanta should experience modest net USA is moving into 96,293 square feet 31, when voters will approve or reject at Georgia State University, expects absorption gains for the balance of the at Royal Centre Two North Fulton. a transportation sales tax initiative Georgia to add 26,800 jobs in 2012, year, most of which will still be con- FLEETCOR will relocate into 65,846 with much of the added tax revenue of which 6,300 jobs would be consid- centrated in Class A buildings as ten- square feet at Spalding Ridge in the slated to expand the 10-county Metro ered ‘premium’ jobs, while Atlanta’s ants continue their flight to quality. Peachtree Corners submarket. Atlanta region to build 157 transporta- economy will gain 17,400 of those jobs Class A space in Buckhead has been Cox Enterprises is responsible for tion projects. (We believe it will pass.) for the year — with 3,900 being pre- the biggest beneficiary of Atlanta’s the biggest owner/user activity in The sales tax would reach 9 percent in mium or well-paid positions. This is flight to quality in companies not just Atlanta as it continues to develop two Atlanta and 8 percent in Fulton and all good, but it may not be enough. moving to higher quality office build- 300,000-square-foot buildings in the DeKalb if passed. Compounding the jobs challenge, ings, but also upgrading submarkets. Central Perimeter submarket in an The net effect of added transporta- office users are looking for less square Since January 2010, Buckhead has effort to consolidate its operations. tion revenue has potential long-term footage per employee to reduce occu- accounted for approximately 75 per- While there are no major specula- consequences for all the Metro Atlanta pancy costs. The average is now under cent of the Class A net absorption tive office buildings in the pipeline, counties. Namely, a likely increase in 200 square feet per employee and in Atlanta. A majority of the office Jamestown Properties is redeveloping speculative, suburban office develop- likely to trend lower. space developed in the last cycle, the former Sears distribution center ment projects along the new routes. Against this backdrop, the Atlanta which afforded tenants significant on the eastern edge of Midtown into — Alan Joel and Dan Granot are office market ended the first quarter concessions, is now committed. Fur- a mixed-use property. Rebranded as co-principals of Atlanta-based Joel & with a vacancy rate of 16.5 percent, thermore, only two buildings in the Ponce City Market, the 2.1 million- Granot Commercial Real Estate/ according to CoStar Group. In addi- entire submarket, Phipps Tower and square-foot center will include a hotel, CORFAC International. DEVELOPING SUPERIOR RETAIL PROPERTIES THROUGHOUT THE SOUTH COMVEST Properties, LLC is a commercial real estate development company. Together with its affi liate, Net Lease Developers, LLC, COMVEST is an active developer of shopping centers and single tenant net leased properties throughout the South. Join us on FaceBook VISIT US AT ICSC RECON #S5946, South Hall 1, Las Vegas Convention Center 228.594.3400 • www.COMVEST.net 286 Beauvoir Road, Suite 200 • Biloxi, Mississippi 39631 MAY 2012 SOUTHEAST REAL ESTATE BUSINESS 21.