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Anthem's relocation contributes to Downtown Atlanta's negative absorption

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Downtown_2019

The Downtown Atlanta submarket was affected mostly by Anthem's relocation out of Bank of America Tower to its newly delivered office building just a few blocks north in Midtown.

Key Takeaways

  • Downtown experienced its second consecutive quarter of negative absorption in Q1, losing 114,000 square feet of occupancy.
  • The submarket was affected mostly by Anthem's relocation out of Bank of America Tower to its newly delivered office building just a few blocks north in Midtown.
  • As a result of the negative absorption, office vacancy has begun to trend upwards in Downtown. The overall and Class A vacancy rates are at their highest levels since the end of 2018.
  • Average rental rates took a hit in the first quarter, declining 1.3% from the end of last year. Some of this is due to the added vacancy in Q1, but some of it could be attributed to a change in data reporting.
  • Downtown was anticipated to see some headwinds in the way of relocations in 2020. The first quarter gives a glimpse of this. A few large occupancies should help the submarket in Q2; however, the COVID-19 pandemic could have a detrimental impact.

1Q20_Downtown

Anthem's relocation contributes to Downtown Atlanta's negative absorption

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Related Experts

Drew Levine

Senior Vice President, Principal

Atlanta

I am a Senior Vice President in the Occupier Services Group, a Colliers group that exclusively represents tenants. I have successfully advised startups, high-growth, and established companies since 2011. My team delivers customized services on local, national, and global levels that allow companies to make well-informed, profit driven real estate decisions. I have been involved in a wide range of transactions, from small acquisitions for startup companies to campus projects for Fortune 500 companies. Our work has included relocation and expansion projects, consolidations and dispositions, headquarter planning, lease terminations and complete portfolio planning strategies for hundreds of leading technology, professional services, and manufacturing companies. We strive to deliver real estate business solutions that: add measurable value, reduce costs, decrease business operating risks, improve workplace performance, expand flexibility, and increase overall profitability.

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