Office Market Summary
In the first half of 2019, the Atlanta office market slowed slightly from the record setting 2018 performance as vacancies increased slightly, values pulled back, transaction volume slowed and under construction is outpacing absorption. However, cap rates continue to compress and rents are rising. Overall, the metro Atlanta office segment remained strong through the first half of 2019.
Below is a quick summary of the Q2 2019 Metro Atlanta Office Market stats as compiled by Crossroads Appraisal Group from information obtained from CoStar. If you would like a PDF version of the information below, it is available here for your convenience.
Supply increasing at a more robust pace since 2016
Redevelopment trend remains strong as razing of older buildings on track to outpace 2018 demolitions
Trending down from 2013 through 2016 and leveling off since with a slight up tick Mid-year 2019 to 11.4%.
ABSORPTION, DELIVERIES & UNDER CONSTRUCTION
Absorption has slowed in 2019
Red Flag – Under Construction at six year high significantly outpacing Absorption
Sales remains strong with 2019 on pace for 1,046 transactions
Cap rates continue to trend down despite interest rate hikes
Values down slightly from 2018 but still ahead of prior years
Despite slowing absorption, increased construction levels and vacancy rates, rental rates continue to grow topping $25.00 per square foot for the first time.