The Impact of Alternative Office Space on Atlanta’s Office Market
by Huston Green
As Atlanta began recovering from the Great Recession and job growth ensued, more companies began to focus on recruiting millennials. Part of enticing this new generation into the fold was offering them a work environment unlike the traditional offices that fill many of Atlanta’s towers. Spaces with open floor plans aimed at fostering collaboration began taking the place of closed corner offices, and as such, historic buildings near pedestrian-friendly amenities began to undergo transformation. In the last half decade, creative loft and modern office spaces have popped up across the city, and currently, the supply can barely keep up with demand, leading to more and more projects under construction or proposed.
Creative loft office nodes
Many of the hot spots for creative loft offices are spurred by the connectivity of the Beltline and top-notch amenities. The Westside—where the core artery is Howell Mill running from 17th Street almost all the way down to the Georgia Dome—is one of the most mature nodes for alternative office space. Over the past decade, it has developed into a center of highly touted restaurants and retail with a plethora of residential options. This trend is further supported by the Westside’s close proximity to Georgia Tech, a recruitment headquarters for the start-ups, incubators and technology companies often housed in alternative office spaces. As a result of these dynamics, the Westside is experiencing very low office vacancy—roughly 7.5 percent in the Class A segment—and there are currently several significant projects under construction or proposed for the Westside, including Stockyards, Star Metal Lofts and T3 at Atlantic Station.
There are also a handful of newer creative office nodes that are becoming just as vibrant as the Westside. The Eastside is one of the fastest growing areas in the city. Anchored by the most mature part of the Beltline, the area is undergoing significant growth along the Memorial Drive corridor and has already experienced huge success with the opening of Ponce City Market, a mixed-use development demanding some of the highest office rents in the city. Home to MailChimp, Athenahealth, Cardlytics and Cox Enterprises, PCM’s original restaurants and shops, direct connectivity to the Beltline and historic character create a nearly unparalleled combination of amenities for companies looking to keep employees happy. The boom on the Eastside is expected to continue with several new projects planned, including 725 Ponce, a 360,000-square-foot office tower above an urban-prototype Kroger.
Some additional, albeit smaller, creative office submarkets in Atlanta include Chamblee—an alternative to Buckhead for the right tenant—and Armour Yards near Sweetwater Brewing Company where several projects are currently anticipated or underway. What weaves all these hot spots together is the charm and character they provide through historic surroundings and authentic amenities—a contrast to cookie cutter office developments often surrounded by fast-casual chain restaurants.