Tenants looking for larger blocks of office space, take caution (and a proactive approach)…

The leasing environment in Atlanta has changed significantly since the last time most tenants negotiated leases.  The shift to a landlord’s market has contributed to a jump in rates that has seemed a bit like a sucker punch to many companies. When looking at larger blocks of office space in Atlanta’s major submarkets space is getting tight research indicates.

The likely result is that office tenants will be coming out to the market earlier, or at least giving it strong consideration.

Midtown’s availability of large spaces has remained level but Buckhead is showing a decrease in supply of big block options as well as a decrease in sublet spaces available. Not a big block user? Beware of your neighbor who may want your space! Some partial floor tenants are being forced to relocate to accommodate big users.

Atlanta’s quoted rental rates are rising across the board, which points to further evidence of landlord’s advantage. And limited sublet options are directing tenants to direct office space, further improving market’s fundamentals.

With population projections continuing to rise, it is expected that availabilities at office buildings within walking distance of MARTA will require a premium. Perhaps, for the first time increased traffic congestion could really influence more public transportation usage.

At the same time, Atlanta’s suburban office markets are staying active. On the heels of big activity at Avalon, Alpharetta office fundamentals are shifting as well.

 Got Advice? Michael Ulin with JLL's Tenant Advisory team provides intelligent real estate solutions.