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2021 brings continued market softening in Atlanta, though demand decline may be leveling of
One year into the COVID-19 pandemic, the Atlanta office market continues to see an increase in available space as organizations look to later in the year, and more widespread vaccination, for a more earnest return to the office. In the first quarter, overall availability increased by 120 basis points (bps) from Q4 2020 and by 610 bps in the past 12 months, now at 26.1%. Class A availability increased similarly, rising 100 bps over the quarter and 700 bps year over year to 28.4%. Availability rates are reaching historic highs, fueled by the most recent development cycle, sublease inventory increasing, and companies looking to adopt more hybrid remote models. Still, fundamentally Atlanta remains attractive to many companies looking to relocate regional offices, tech hubs, and corporate headquarters. Just 1.3 million square feet (msf) were leased this quarter, marking the lowest first-quarter total in over four years. However, activity jumped up from Q4, which could signal that Atlanta has reached the bottom of the demand slowdown after multiple quarters of declines.