Offi ce Submarket Report ATLANTA | DOWNTOWN Q2 2020 Key Takeaways Market Indicators Downtown Downtown > Occupancy levels held steady in Downtown for Q2 as net Relative to prior period Q2 2020 Q3 2020* absorption was close to the zero mark at the end of the quarter. VACANCY - > Year-to-date absorption remains in the red thanks to Anthem’s NET ABSORPTION previously mentioned relocation to Midtown. As of mid-year, - - Downtown has the second highest occupancy loss so far this year. CONSTRUCTION - > Leasing activity has been steady in the submarket despite the RENTAL RATE pandemic slowing overall deals being transacted. Most of the leases completed in the submarket, however, are not large-scale. *Projected > Rental rates continue to rise Downtown. The pace at which they are increasing though is moderating and is below the market average. Summary Statistics All > The remaining half of the year is somewhat of a toss-up as to Downtown Offi ce Market Classes Class A Class B how activity is going to turn out Downtown. There are a couple Total Inventory of sizeable occupancies set for Q3 and Q4; yet at the same time, (Millions Square Feet) 26.7 14.4 8.8 subleases have begun to creep up in the submarket, meaning these tenants may possibly vacate by year’s end as well. Vacancy Rate 12.7% 15.7% 8.6% Absorption, Deliveries and Vacancy Change From Q1 2020 0.1% -0.2% 0.2% Absorption YTD 100,000 13% -113 -79 -28 (Thousands Square Feet) 50,000 Construction Deliveries YTD 12% 15 - 15 0 (Thousands Square Feet) 2Q19 3Q19 4Q19 1Q20 2Q20 Square Feet Under Construction (50,000) 93 30 63 11% (Thousands Square Feet) (100,000) Asking Rents (150,000) 10% Per Square Foot Per Year Average Quoted $29.00 $29.23 $27.76 Absorption Deliveries Vacancy Change From Q1 2020 0.8% 0.5% 0.2% UPDATE - Recent Transactions in the Market Notable Leasing Activity TENANT PROPERTY LANDLORD SIZE (SF) TYPE Lewis Brisbois Bank of America Tower Shorenstein Properties 48,002 Class A Lease (TBD) Centennial Tower The Dilweg Co. 20,097 Class A Lease Intelliteach 233 Peachtree St. Banyan Street Capital 15,795 Class A Renewal Ideas United 750 Glenwood Ave. - Bldg. 200 Urban Realty Partners 13,315 Class B Lease Notable Sales Activity PROPERTY SALES DATE SALE PRICE SIZE (SF) PRICE / SF BUYER 55 Allen Plaza 3/17/2020 $80,000,000 342,854 $233 Lone Star Funds Southern Dairies - 621 North Ave. 10/4/2019 $34,500,000 81,153 $425 Jamestown LP The Willoughby 8/15/2019 $23,800,000 58,547 $407 Stockbridge Capital Group 100 Edgewood Ave. 9/12/2019 $17,700,000 323,600 $55 Parkway Properties Sources: CoStar Property, Colliers Research Skyline Review Space Available Direct Sublet 60 55 50 45 40 35 30 Floors 25 20 15 10 5 BUILDING Bank of America Plaza SunTrust Plaza Georgia-Pacifi c 191 Peachtree 101 Marietta Street Center RBA 1,330,000 SF 1,249,022 SF 1,133,840 SF 1,222,142 SF 664,477 SF TYPICAL FLOOR SIZE 23,500 SF 25,000 SF 20,000 SF 24,220 SF 20,050 SF % LEASED 66% 95.3% 79.4% 89.3% 91.6% LARGEST SPACE AVAIL. 198,650 SF 22,074 SF 203,023 SF 35,167 SF 80,240 SF RENTAL RATE PER SF (Gross) $36.00-$40.00 $36.00 $27.50-$28.50 $31.00-$35.50 $30.00-$32.00 12345 3 11 7 13 1 2 8 4 3 10 15 9 2 6 16 14 5 8 7 5 4 10 6 12 9 1 2 3 1 2 Offi ce Submarket Report | Q2 2020 | Downtown | Colliers International - Atlanta New Development Source: CoStar Property 1 285 MARIETTA STREET 350,000 SF offi ce 60,000 SF retail Proposed Developers: Seven Oaks Co./ Legacy Property Gr. 2 100 Peachtree Marquis One 225 Peachtree 270 Peachtree Hurt Building 622,084 SF 492,611 SF 349,488 SF 326,023 SF 436,032 SF 19,600 SF 18,000 SF 14,562 SF 13,924 SF 24,224 SF 50 ALLEN PLAZA 870,914 SF 86.3% 77.7% 68.5% 78.7% 86.1% Proposed Land acquired Fall 2018 57,499 SF 72,404 SF 52,213 SF 63,914 SF 18,685 SF New Owner: Drapac Group $31.50 $26.50-$28.50 $23.50-$28.50 $22.50 $22.50-$25.00 3 67 8910 Aerial Legend Points of Interest 1 Mercedes-Benz 9 Stadium The Gulch 2 State Farm Arena 10 Georgia Tech WALDO’S-40 BOULEVARD Georgia World 120,452 SF 3 11 Atlanta Civic Center Congress Center Under Construction Buildings by Number College Football Developer: Lucror Resources (see opposite page) 4 CNN Center 12 Hall of Fame Centennial MARTA Rail Line 5 Olympic Park 13 Georgia State University New Construction 6 Georgia Aquarium14 Underground Atlanta 7 World of Coke 15 State Capital 8 Civil Rights Museum 16 Georgia State Stadium 3 Offi ce Submarket Report | Q2 2020 | Downtown | Colliers International - Atlanta In The News > Georgia Tech plans $750M expansion of Technology Enterprise Park: Georgia Tech is planning FOR MORE INFORMATION a massive expansion into Downtown. The university is in the process of rezoning approximately 18-acres of undeveloped land at Technology Enterprise Park where it wants to create a new Scott Amoson innovation district for the city. Plans call for a mix of uses including 610,000 square feet of lab VP, Director of Research | Atlanta and research space; 1-million square-feet of offi ce; 100,000 square feet of commercial space; +1 404 877 9286 and around 420-unit units of multi-family. The total cost of the project is around $750 million. [email protected] It is expected to bring up to 5,000 jobs to the area, and will also encourage revitalization and redevelopment of the city’s emerging Westside. > Drapac puts Downtown development site with 1.4M square-feet of potential up for sale: COLLIERS INTERNATIONAL Australian real estate investor Drapac Capital Partners is selling a roughly one-acre parcel close ATLANTA OFFICE SPECIALISTS to Centennial Olympic Park in Downtown which could eventually be redeveloped into 1.4 million Allison Bittel Michael Lipton square feet of space. The property located at 323 Spring Street was purchased by Drapac in Frank Cannon Paul Reese 2016 and is currently a commercial parking lot. It is one of two Downtown parcels the investor has put up for sale as of late. It currently has 505 Courtland Street under contract. Jessica Doyle Morgan Reynolds Lee Evans Jodi Selvey AT A GLANCE | Centennial Yards Deming Fish Meredith Selvey > $5 billion redevelopment of Atlanta’s “Gulch” Josh Gregory Fred Sheats site, transforming 50-acres of parking lots Russ Jobson Pete Shelton and former rail-yards. Jeff Kelley Hayes Swann > Largest mixed-use development in the Dany Koe Andrew Waguespack Southeast, featuring up to 12 million square Eric Kulbacki Andrew Walker feet of offi ce, retail, residential and hotel. Heather Lamb Bob Ward > First phase to include offi ce renovations of Drew Levine Stewart Yates former Norfolk Southern buildings > Master developer, CIM Group, expects build- out of completed project to take 5 to 15 years due to complexity of the redevelopment. Colliers International | Atlanta Offi ce | Downtown Listings PEACHTREE THE MILL CENTER 30,000 SF 982-169,628 SF Lease Heather Lamb / Deming Fish / Jessica Doyle Heather Lamb 100 PEACHTREE 19,070-38,415 SF Sublease MARQUIS I & II Pete Shelton / 1,168-45,280 SF Lease Drew Levine Jessica Doyle WALDO’S 120,452 SF Lease Heather Lamb / ONE GEORGIA CTR Jessica Doyle 898-2,996 SF Lease Jessica Doyle FLATIRON BLDG. 1,084-13,835 SF Mark Maggard Colliers International | Atlanta Promenade | Suite 800 1230 Peachtree Street, NE Atlanta, Georgia, 30309 Copyright © 2020 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.