Companies in Atlanta leased more office space in the first quarter of 2024 than at any point since 2021, according to new data from Savills. It was the busiest first quarter in five years, but the record amount of vacant space on the market continues to rise.
Midtown Atlanta is the most sought-after office market in Atlanta.
There were 2.4M SF of Metro Atlanta office leases signed in the first three months of the year, 71% more than in Q1 2023, per Savills. Nevertheless, office availability including sublease space in the region increased to 29.6%, up from 27.7% a year earlier.
The increase in availability is largely a result of new construction hitting the market, Savills Vice Chairman David Rubenstein, who heads the tenant-focused brokerage’s Atlanta office, said in an interview Wednesday.
For the first time in more than 14 years, there is less than 1M SF under construction in the market. The projects underway, which include 1050 Brickworks, Southern Post, 1020 Spring and 619 Ponce, have little in the way of pre-leases signed, according to Savills researchers.
Class-A availability is almost 35%, Savills said.
More than 2M SF was added to the region’s inventory year-over-year, and the newer buildings are taking up a larger share of the market, helping to drive overall vacancy higher, Rubenstein said.
The region’s total direct office vacancy rate stands at 24.6%, according to preliminary Cushman & Wakefield data, a rise of nearly 2% from last year.
“We’ve got a lot of new availability, some new buildings that have delivered. They tend to outperform the market because tenants are looking for all the bells and…
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