Atlanta’s Office Market has been dealing with the effects of the coronavirus pandemic over the past several quarters. Despite landing major tenants like Microsoft. Carvana, and Hapag-Lloyd, overall leasing activity hasn’t crossed pre-pandemic levels. Uncertainty surrounding the pandemic has affected tenants’ abilities to maintain or increase their physical footprints, which will continue to weigh this sector down until leasing returns to pre-pandemic levels. Rent growth has slowed down across the city. It has remained stagnant for the past quarter, stemming from 18% vacancy across all submarkets, due to a few large moveouts and saturation of sublease availability. Investors have been drawn to the bargain in terms of yields and pricing compared to gateway office markets, pushing sales up from the previous quarter to $254 million, 67% up from last quarter. Sales in Q4 ended 2021 with a sales volume of over $2 billion. This marks the strongest year since 2016, which along with the lack of distressed sales, indicates a confident return to Atlanta Office from a capital markets perspective. Atlanta’s recently delivered and under construction are facing a challenging leasing environment, which has slowed down the speculative construction pipeline to 4.5 million SF from the nearly 8 million SF at the start of 2021.

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