Atlanta Office Market
Annual full-service asking rental rates continues to increase, reporting a new historical high of $32.98/SF, reflecting a 3.4% increase year over year. While the rental rate growth in 2024 was slightly higher than the 3.2% reported in 2023, the annual pace of rent growth has generally been declining since 2017. Although net absorption was positive 62,785 SF in the fourth quarter of 2024, three new buildings delivered vacant. As a result of supply outpacing occupancies, the vacancy rate increased by 20 basis points quarter over quarter to 26.2%. The under-construction pipeline continues to consistently slow, declining by 61.5% quarter over quarter to 522,000 SF, the lowest level in recent years. The historically low pipeline along with no new construction starts in 2024 will improve the supply-demand imbalance. The average deal size for all classes in the fourth quarter of 2024 was 6,714 SF, with Class A deal size continuing to be larger at 8,981 SF on average.
Download Atlanta Office Market Report 4Q24
Atlanta Industrial Market
The market realized 2.1 MSF of net absorption in the third quarter of 2024, reflecting a 77.5% increase from the previous quarter and a 442.0% increase year over year. Supply decreased dramatically in the third quarter of 2024, dropping 58.9% year over year to 2.0 MSF, marking an 82.1% decline from the previous quarter’s all-time high of 11.0 MSF. Still, year-to-date supply outpaced demand, resulting in the vacancy rate increasing 260 basis points year over year to 8.0%. Overall rental rates were $6.90/SF, increasing by 4.9% year over year, but are still 0.4% lower than the all-time high of $6.93/SF in the fourth quarter of 2022. The construction pipeline trended downward for the fifth consecutive quarter to 17.5 MSF under construction in the third quarter of 2024, marking a 12.0% quarter-over-quarter decline and accounts for 2.3% of current inventory.
Download Atlanta Industrial Market Report 3Q24