Metro Atlanta Office Market Experiences Significant Surge in Leasing Activity

Metro Atlanta Office Market Shows Signs of Life

Hey there, Atlanta! If you’ve been keeping an ear to the ground about the commercial real estate scene, you’ll be happy to hear some promising news. The chatter is getting louder as three of the largest office owners in our fabulous city – Cousins Properties, Highwoods Properties, and Piedmont Office Realty Trust – are reporting a jump in office leasing activity. Yes, you heard that right! It looks like the office market is finally bouncing back, and there’s plenty to be excited about.

Leasing Activity is on the Rise

During their recent third-quarter earnings calls, leaders from these firms struck a surprisingly optimistic tone, revealing that leasing activity is up in Metro Atlanta and beyond. All together, they managed to lease nearly 500,000 square feet in our area just in the last quarter. Interestingly enough, a good portion of those deals involved companies that are actually expanding their footprints instead of shrinking them. Isn’t that great news?

Richard Hickson, Executive Vice President at Cousins Properties, shared during the call on October 25th, “Our late-stage pipeline remains at a very healthy level.” And if you thought that was good, he said their early-stage pipeline is even more encouraging, which means there’s a lot more action expected in the future. However, patience is key here—these opportunities take some time to turn into signed leases.

A Market on the Move

Now, let’s crunch some numbers. In total, companies in Metro Atlanta leased over 2 million square feet in the third quarter alone. That’s a whopping 30% increase from the same period last year! Talk about a jump! With year-to-date totals sitting at around 7.2 million square feet, things are really heating up.

The uptick in leases comes as companies are starting to demand that their employees return to the office more regularly. Finally, after delaying big decisions, these companies are stepping back into the leasing game. Exciting times are ahead!

Piedmont, Cousins, and Highwoods Lead the Charge

Piedmont Office Realty Trust inked a tidy 13 office leases encompassing 120,000 square feet in the third quarter. George Wells, their COO, emphasized that this included a “full-floor headquarters operation— the ninth in four years.” Wow, talk about staying busy!

Not wanting to be left out, Cousins also made waves, leasing 104,000 square feet in Atlanta, with a stunning 68% of those being new or expansion leases. Hickson noted that there were seven deals in the market for 75,000 square feet or more in just one quarter. Meanwhile, Highwoods Properties wrapped up a total of 271,000 square feet in leases, much of it being new deals. The development is buzzing indeed!

The Buzz Around Town

As for the larger companies, Highwoods CEO Ted Klinck mentioned seeing activities with prospective tenants looking for spaces ranging from 50,000 to 200,000 square feet. This points to the fact that larger customers are coming back to the office or even to the market itself. Exciting times, without a doubt!

What’s Next for Atlanta?

Hickson also noted that Atlanta is the company’s largest contributor to rent roll-ups, beating out both Austin and Tampa. With some premium office space dwindling, there could be upward pressure on rent prices. Colin Connolly, the CEO of Cousins, said, “The lifestyle office market continues to improve. New construction is at historic lows while leasing demand is picking up.”

There’s quite the storm brewing in Atlanta’s commercial real estate space, with talks about new developments heating up. Let’s just say, if you’ve been aiming to secure a prime office spot, now’s the time to keep an eye on the market!

The message is clear: Metro Atlanta is on the rebound, and there’s an air of optimism floating around as we look to the future. More deals are expected, and the scene is set for a busy office market ahead. Your dream office could just be around the corner!