Hiring Gains to Help Mend Atlanta Office Market

Hiring Gains to Help Mend Atlanta Office Market

The Atlanta office sector in 2011 is expected to post its first reduction in vacancy in four years, according to Marcus & Millichap Real Estate Investment Services. The number of office-using jobs in metro Atlanta is projected to increase by 11,700 this year, following the loss of 8,200 workers in 2010. Employers in metro Atlanta will fill 37,000 positions in 2011 in response to improving business conditions, predicts the Encino, Calif.-based brokerage firm.

A rebound in hiring is expected to lead to the absorption of 1.2 million sq. ft. in 2011. The improving jobs market coupled with minimal construction will lower the vacancy rate 70 basis points to 20.2%, projects Marcus & Millichap. If realized, that would mark a stark contrast to 2010 when the vacancy rate ballooned 250 basis points.

Office completions in 2011 are forecast to slow to 250,000 sq. ft., down from 2.2 million sq. ft. in 2010. Still, asking rents are expected to slip 0.3% in 2011 to $21.11 per sq. ft. Effective rents, meanwhile, are projected to dip 0.5% to $16.59 per sq. ft.

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