By: David C. Smith, Senior Director of Occupier Research, Americas
Companies continue to see the urban core as an opportunity to utilize real estate space to attract and retain talent, as well as to increase access to clients, customers and peers. The results of a recent survey partnership between Cushman & Wakefield and CoreNet Global indicate that a large proportion (44 percent) of companies have moved one of their business operations from a suburban setting into an urban environment.
Atlanta has been experiencing a revitalization in its urban core. Over the past three years, 91 percent of all new office product has been in two of Atlanta’s three CBD submarkets: Midtown (74 percent) and Buckhead (17 percent). And, there have been a number of high profile moves in-town.
While the cost of Class A office space in the CBD is on average 68 percent more expensive than suburban alternatives across the U.S., the differential in Atlanta is, while significant, much smaller. The weighted average of rent across the three CBD sub-markets is $29.23, which is 8 percent higher than the average rental rate for Class A office space in the non-CBD sub-markets ($27.08). The two most expensive sub-markets – Midtown and Buckhead – are both in Atlanta’s urban core and have average rents above $33 per SF.
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