Atlanta ended 2019 on a strong note in terms of demand, with more than a million square feet absorbed. This is the strongest performance we’ve seen since 2015, and it doesn’t even include the large build-to-suit projects Atlanta has seen lately for State Farm, NCR, and Anthem Blue Cross Blue Shield. (Transwestern’s data does not include those, but they do monitor them).

With the exception of Central Perimeter, all of the major areas in Atlanta saw healthy absorption in 2019 – ranging from 100,000 to 300,000 square feet each. The suburbs saw a little more demand than the urban core, though to be fair it’s a much larger portion of the market.

Likewise, vacancy is at its lowest point in a year, even with more than a million square feet delivered during the year. (Nearly 70% of the space completed in 2019 has already been leased.)

Midtown is still the dominant submarket in terms of high rents, space under construction, and low vacancy

Asking rents continue to rise in most submarkets, particularly in Class A space. The exceptions are Central Perimeter and North Fulton, where Class A asking rents dipped slightly.

Atlanta’s industrial market had a very strong third quarter and a healthy fourth quarter in terms of demand. In general, absorption has returned to “normal” after a couple of exceptional years. 2019’s absorption of 12.2 million SF essentially matches the market’s 10-year average.

Construction is still very robust. After delivering about 15 million SF each in 2018 and 2019, there are still 17 million SF under construction now – all set to deliver in 2020. Pre-leasing is up, though. Last quarter about 6% of UC space was leased, and now that figure is 33%.

Vacancy is creeping up slowly – from 2018’s 5.2% (a 20-year low) to 5.8% now.

On the investment market, volume has slowed, but pricing is up.

Asking rents dipped slightly in Q4 from Q3’s 20-year peak.

Essentially, while some metrics are slowing, the market is just coming off of a historic peak in terms of vacancy, demand, and rents. So, Atlanta is still outperforming every other year in the past two decades.