Atlanta’s office market recorded a healthy performance despite national economic headwinds. The metro ranked #2 in the U.S. for net absorption and vacancy held steady in Q4.
Read our Five Fast Facts for more insight into the key trends that impacted the Atlanta office office market during the fourth quarter.
- #2 Absorption in the U.S.:
With 485 KSF of occupancy gains, Atlanta recorded the second-strongest office absorption in the country in Q4. This figure was bolstered by three suburban and two CBD tenants each moving into new spaces 50 KSF+.
- Rents Continued Climbing:
The Class A direct average asking rent rose 4.3% YOY to a new high of $34.21 PSF as the stratification of this product widened further. Buildings 100 KSF+ built or substantially renovated since 2020 commanded an average of $51.18 PSF, while buildings built before 2000 averaged $32.96 PSF.
- Quarterly Leasing Surpassed 1 MSF:
While four 50-KSF+ deals were inked during Q4, small and mid-size transactions drove activity, bolstering the annual total to 7.5 MSF.
- Vacancy Held Steady:
At 22.4%, the total market vacancy rate remained unchanged in Q4. While suburban vacancy fell to 20.4%, best-in-class new construction deliveries caused the rate in the CBD to climb to 25.7%.
- Creative Office Construction Abounds:
Nearly 2.5 MSF delivered throughout 2022, 45.8% of which has been pre-leased. Construction remains underway on an additional 1.9 MSF, including seven creative office projects in Midtown.