Atlanta Office Market
Annual full-service asking rental rates increased to $31.75/SF, a 2.0% increase year over year. Overall vacancy rates increased by 170 basis points year over year to 25.7%, driven by supply outpacing net absorption. The under-construction pipeline declined 23.3% year over year to 1.9 MSF and has generally been slowing, indicating a lower the risk of overbuilding. The average deal size for all classes in the first quarter of 2024 was 5,676 SF, with Class A deal size being larger at 7,296 SF on average.
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Atlanta Industrial Market
The market realized 3.7 MSF of net absorption in the first quarter of 2024, the highest recent quarterly level since the beginning of 2023. Overall rental rates were $6.48/SF, decreasing by 2.1% year over year. The decrease also represents a 7.6% decrease from the all-time high of $7.01/SF in the fourth quarter of 2022. The construction pipeline trended downward for the third consecutive quarter, reporting 23.3 MSF under construction, creating a possibility for potential supply constraints as economic conditions improve. Following the recent trend of supply outpacing demand, vacancy increased in the first quarter of 2024 by 240 basis points year over year to 6.6%.
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