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Q3 2010 | DOWNTOWN

ATLANTA

SUBMARKET REPORT

TRENDS & HIGHLIGHTS NEW SUPPLY, ABSORPTION AND VACANCY RATES 200,000

Total SF

24,937,459

17%

Vacancy Rate

15.4%

16%

YTD Net Absorption

74,179

150,000 100,000 50,000

15%

0 (50,000)

3Q09

4Q09

1Q10

2Q10

3Q10

(100,000)

YTD Deliveries

0

Under Construction

0

14% 13%

(150,000) (200,000)

12% Absorption

Deliveries

Avg. Class A Rate

$19.49

Source: CoStar Property

Vacancy

MARKET INDICATORS Q3 2010

NEXT QTR

UPDATE Recent Transactions in the Market SALES ACTIVITY

VACANCY NET ABSORPTION CONSTRUCTION

RENTAL RATE

PROPERTY ADDRESS

SALE PRICE

SIZE SF

PRICE / SF

BUYER

120 Ralph McGill Blvd. (Forc.)

$2,950,000

23,080

$127.82

Sunrise Bank of Atlanta

159 Ralph McGill Blvd. (Forc.)

$1,200,000

36,000

$33.33

Georgia Properties LLC

353-363 Parkway Dr.

$1,000,000

9,000

$111.11

Metro. Atlanta Ob/Gyn

139 Ralph McGill Blvd.

$850,000

19,500

$43.59

Ralph McGill 139, LLC

Downtown

LEASING ACTIVITY

www.colliers.com/atlanta

TENANT

PROPERTY ADDRESS

SIZE SF

TYPE

InComm

250 Williams St.

186,675

Class A Renewal & Exp.

Carlock Copeland & Stair

191 Peachtree

52,000

Class A Lease

McKinsey & Co.

Georgia Pacific Center

50,000

Class A Renewal

CredAbility

270 Peachtree

41,772

Class A Lease

Downtown remains one of most stabilized office markets in Atlanta. Third quarter absorption totaled 49,202 SF, marking the second consecutive quarter of increased occupancy.

For the year, office leasing in the Downtown office submarket has been steadily consistent. The largest deal this quarter was a renewal and expansion by InComm at 250 Williams Street. The gift and prepaid card distributor will be moving into an additional 90,506 SF early next year.

On the whole, Downtown has held its own through the current economic landscape. In the past two years, the submarket has essentially broke even with move-ins and move-outs.

Downtown is garnering a lot of attention as of late with new attractions being suggested for the area.


MARKET REPORT | Q3 2010 | ATLANTA OFFICE | DOWNTOWN

SKYLINE REVIEW Space Available Direct Sublet

60 55 50 45 40

Floors

35 30 25 20 15 10 5

BUILDING RBA % LEASED LARGEST SPACE AVAIL. RENTAL RATE PER SF (Gross)

Bank of America Plaza

SunTrust Plaza

Georgia-Pacific Center

191 Peachtree

Centennial Tower

1,253,499 SF

1,249,022 SF

1,133,840 SF

1,209,721 SF

638,731 SF

80.6%

92.4%

88.4%

84.8%

89.5%

203,068 SF

23,545 SF

112,609 SF

102,045 SF

37,600 SF

$30.00-$31.00

$26.00-$28.00

$21.00-$22.00

$26.00

$15.00-$22.00

1

2

3

4

5

12 11

8

1 9

2

7

8 4 3 10 9 6 3 5

10

2 7 6

5 4

3 P. 2

| COLLIERS INTERNATIONAL

2

1

1

13

15 14

16


MARKET REPORT | Q3 2010 | ATLANTA OFFICE | DOWNTOWN

NOTABLE PROJECTS Source: CoStar Property

1

E Q U I TA B L E

GSU SCIENCE CENTER 350,000 SF Delivered March 2010

2

100 Peachtree

Marquis One

North Tower

270 Peachtree

55 Park Place

625,000 SF

460,437 SF

302,951 SF

325,000 SF

553,018 SF

47.7%

67%

65.9%

73.1%

74.2%

122,386 SF

54,287 SF

127,713 SF

41,772 SF

278,716 SF

$17.50-$19.50

$20.50-$21.50

$18.50-$19.50

$18.00-$19.00

$18.50

6

7

8

9

10

AERIAL LEGEND

POINTS OF INTEREST 1 Georgia Dome

100,000 SF $125 million project Construction pending

3

9 The Varsity

2 Philips Arena

10 Georgia Tech

World 3 Georgia Congress Center

11 Atlanta Civic Center

4 CNN Center

Sweet Auburn 12 Curb Market

MARTA Rail Line

5 Centennial Olympic Park

13 Georgia State University

New Construction

6 Georgia Aquarium 14 Underground Atlanta

Buildings by Number (see opposite page)

CIVIL RIGHTS MUSEUM

7 World of Coke

15 State Capital

8 The Fox Theater

16 Turner Field

50 ALLEN PLAZA 870,914 SF Developer: Barry Real Estate Proposed

COLLIERS INTERNATIONAL |

P. 3


MARKET REPORT | Q3 2010 | ATLANTA OFFICE | DOWNTOWN

IN THE NEWS

480 offices in 61 countries on 6 continents

• Plenty

of land downtown, boosters tell developers: Central Atlanta Progress recently released a map highlighting areas ripe for development in the submarket. The map shows five areas in Downtown with tracts large enough to support transformative development. These five areas include: the area near Five Points MARTA station, the ‘Gulch’ area near the Georgia Dome, the Sweet Auburn district, the Fairlie-Poplar district and the “railroad district” near Castleberry Hill. In all, these areas encompass a total of 467 under utilized acres. plans for ‘Gulch’ hub a transit gamble: With plans for a multi-modal transit terminal back on track, the project faces a number of uncertainties. The total cost of such a grandiose project is one; especially when even the best guess could be far off. Funding to build rail systems linking to the hub is another, along with whether or not metro Atlantans will take it upon themselves to adopt alternative transportation. Finally, there is question as to whether or not the hub will create demand for more real estate in the area given the excess of empty and dilapidated buildings. Regardless, enough interest from both local and international development firms exists for redeveloping the 16-acres tract.

United States: 135 Canada: 39 Latin America: 17 Asia Pacific: 194 EMEA: 95

• Grand

• Cox

Enterprises donates former AJC building to city: The former location of the Atlanta JournalConstitution is being donated to the city of Atlanta by Cox Enterprises. The AJC relocated from the facility earlier this year to office space in Central Perimeter. The donation includes a nine-story office building, four-story printing press building, warehouse space and surface parking. Mayor Kasim Reed plans to use the facilities for police and fire training academies, gallery space and for a public auditorium.

AT A GLANCE | Streetcar gets funding

U.S. Department of Transportation agrees to grant $47 million to the city’s proposed $70 million streetcar project.

First phase of project will run 2.6 miles from the King Center site to Centennial Olympic Park, featuring a dozen stops and direct connection to MARTA.

$2 billion in annual revenue

• Over 2 billion square feet under

management • Over 15,000 professionals

UNITED STATES: Colliers International 1349 West Peachtree Street Suite 1100 Atlanta, Georgia, 30309 TEL +1 404 888 9000 FAX +1 404 870 2845

COLLIERS INTERNATIONAL ATLANTA OFFICE SPECIALISTS: Bob Allen

Craig Mendel

Expected to provide 2,600 trips a weekday in its first year of operation.

Neal Baker

Scott O’Halloran

Lee Evans

Hugh Pafford

Critics argue the streetcar will do nothing to ease metro Atlanta’s biggest transportation problems.

Huston Green

Jodi Selvey

Russ Jobson

Fred Sheats

Construction begins in 2012 with a completion date targeted for 2013.

Nicole Kamen

Pete Shelton

Jeff Kelley

Hayes Swann

Brett Kingman

Andrew Walker

Michael Lipton

Bob Ward

Bob Mathews COLLIERS INTERNATIONAL | ATLANTA OFFICE | DOWNTOWN LISTINGS

135 ANDREW YOUNG INTL. BLVD. 11,000 SF Sale Jodi Selvey / Pete Shelton

This market report is a research document of Colliers International. Information herein has been deemed reliable and no representation is made as to the accuracy thereof. Colliers International-Atlanta, Inc., and certain of its subsidiaries, is an independently owned and operated business and a member firm of Colliers International Property Consultants, an affiliation of independent companies with over 480 offices throughout more than 61 countries worldwide.

Accelerating success.

www.colliers.com/atlanta


3Q 2010 | Atlanta Downtown Office Market Report  

Colliers International Office Market Report for Atlanta Downtown Submarket

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