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Atlanta Real Estate Market Trends | Buckhead Office Q3 2020

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Buckhead_2019

Occupancy declines continued in Buckhead this quarter with just over 30,000 square feet of negative absorption occurring.

Atlanta's Buckhead submarket was mostly affected by USI Insurance's relocation to Central Perimeter. The company vacated 65,125 square feet at Prominence in Buckhead.

With the string of consecutive negative quarters, the overall vacancy rate has been trending upwards in Atlanta's Buckhead neighborhood. The good news is the year-over-year difference is only 50 basis points (0.5%).

Still, vacancies, along with a 170% increase in sublease availabilities over the past two quarters, are affecting Buckhead office rents. Class A averages showed no change from Q2, while overall, the submarket saw a slight decline.

Buckhead's absorption activity is expected to be borderline negative yet again in the fourth quarter. There are not enough scheduled move-ins to cover the space coming on to the market via tenant vacancy.

Key Takeaways

  • Buckhead sees just over 30,000 square feet of negative absorption in Q3 2020
  • USI Insurance's move out of approximately 65,000 square feet was the most significant factor in this quarter's decline
  • Buckhead's overall vacancy rate is trending upwards but year-over-year shows only a 50 basis point difference
  • Buckhead started to show signs of rental rate declines in Q3 2020
  • Absorption is projected to be borderline negative for the Buckhead submarket in Q4 2020

3Q20_Buckhead

Atlanta Real Estate Market Trends | Buckhead Office Q3 2020

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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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