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MEMBER NAME
NAI BRANNEN
GODDARD
Atlanta
Industrial
Report
| Fourth
Office Report
| First
Quarter
2007Quarter 2009
Brannen Goddard
Commercial Real Estate Services, Worldwide.
Atlanta Industrial Market
Fourth Quarter 2009
Leasing Highlights in Select CoStar Markets
Color Coded by Vacancy Rate
Leasing Highlights
Market Overview
Select Markets by Vacancy Rate (YTD)
Northwest Atlanta Ind
North Central Atl Ind
Vacancy:
14.4%
YTD Abs:
(1)M SF
Leasing Activity: 1,614,762 SF
Vacancy:
13.7%
YTD Abs:
(190)K SF
Leasing Activity: 603,209 SF
The Atlanta Industrial market ended the
fourth quarter 2009 with a vacancy rate
of 13.0%. This vacancy rate represents a
0.3% increase over the previous quarter
of 12.7%. This increase in vacancy rate
occurred in a quarter where Atlanta saw
(1,359,843) square feet in negative net
absorption and no new deliveries. Rental
rates are down slightly from the previous
quarter. Two new projects totaling 24,818
square feet are currently underway.
Northeast Atlanta Ind
2009 saw weak demand, falling values,
tighter lending practices and fewer
transactions. As we head into 2010, most
economists are predicting a slow road to
recovery. Housing has bottomed, industrial vacancies are about to peak, and
office and multi-family vacancies should
peak this year. Job losses will continue
through the first half of 2010, but at a
much slower rate.
Vacancy:
11.2%
YTD Abs:
(858) SF
Leasing Activity: 4,912,715 SF
Chattahoochee Ind
Vacancy:
6.5%
YTD Abs:
(368)K SF
Leasing Activity: 316,071 SF
I-20 W/Fulton Ind
Central Atlanta Ind
Vacancy:
15.2%
YTD Abs:
893K SF
Leasing Activity: 3,515,286 SF
Vacancy:
6%
YTD Abs:
(17)K SF
Leasing Activity: 116,404 SF
Stone Mountain Ind
Vacancy:
13.6%
YTD Abs:
(716)SF
Leasing Activity: 484,145 SF
Snapfinger/I-20E Ind
Vacancy:
12.8%
YTD Abs:
(512)K SF
Leasing Activity: 797,523 SF
Economic Overview
UNEMPLOYMENT RATE (OCT)
National
Georgia
Atlanta MSA
South Atlanta Ind
Vacancy:
YTD Abs:
14.5%
(656)K SF
Leasing Activity: 3,627,034 SF
10.0%
10.3%
10.1%
Long-term growth prospects remain
healthy given Atlanta’s diverse economy,
strong in-migration and population
growth, transportation and status as a
logistics and distribution hub.
MARKET INDICATORS
Vacancy Rate:
Less than 5%
5% to 10%
10% to 15%
Brannen Goddard
Commercial Real Estate Services, Worldwide.
15% to 20%
Over 20%
Vacancy
Rate
Net
Absorption
Construction
Rental
Rates
4%
Direct
Sublet
Vacancy Rates by Building Type
Flex
Flex
1993-2009
Shallow-Bay
Shallow Bay
Warehouse
Warehouse
Total
Total
96%
20.0%
15.0%
10.0%
5.0%
0.0%
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
Absorption & Deliveries
Vacancy
Past 12 Quarters
The overall vacancy rate in the Atlanta Industrial market
ending the fourth quarter 2009 is 13.0%. This rate
represents over 72.9 million square feet of vacant space
throughout the Metropolitan Atlanta Industrial market.
Vacancy rates were highest in the Flex & Shallow-Bay
Market sectors of the Stone Mountain submarket.
Deliveries
6,000
4,000
Millions SF
The amount of vacant sublease space is over 2.8 million
square feet, up from the previous quarter. The largest
amount of sublease vacancy was found in the warehouse sector in Northeast Atlanta.
Net Absorption
8,000
2,000
0
Net Absorption
In the fourth quarter 2009, the Atlanta Industrial market
had a negative net absorption of (1,359,843) square feet
compared to a positive net absorption of 34,033 square
feet at the end of the previous quarter. A negative net
absorption of (3,304,092) square feet was reported this
time last year. YTD negative net absorption is over 4.1
million square feet.
(2,000)
(4,000)
2007
Delivered SF
2q
3q
2007
4q
2008 2008
1q
2q
2008 2008
3q
2009
4q
1q
2009 2009
2q
Absorption SF
Vacancy
2009
4q
14.00%
12.00%
6,000,000
10.00%
4,000,000
Millions SF
3q
Deliveries, Absorption & Vacancy
Deliveries, Absorption & Vacancy
8,000,000
2007 2007
1q
8.00%
2,000,000
6.00%
0
4.00%
(2,000,000)
2.00%
(4,000,000)
0.00%
2006 4q
2007 1q
2007 2q
2007 3q
Brannen Goddard
Commercial Real Estate Services, Worldwide.
2007 4q
2008 1q
2008 2q
2008 3q
2008 4q
2009 1q
2009 2q
2009 3q
2009 4q
All data for text, charts & graphs provided by ©CoStar Property.
All Construction Activity
Markets Ranked by Under Construction Square Footage
Under Construction Inventory
# Blds
Market
Northwest Atlanta Ind
Northeast Atlanta Ind
Stone Mountain Ind
South Atlanta Ind
1-20 W/Fulton Ind
Chattahoochee Ind
North Central Atlanta Ind
Central Atlanta Ind
Snapfinger/I-20 East Ind
Totals
Total RBA
1
1
0
0
0
0
0
0
0
2
Preleased SF
18,750
6,068
0
0
0
0
0
0
0
24,818
Flex
0.0%
100.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
23.6%
All Existing
33,570
46,675
30,659
72,164
68,632
34,184
28,372
34,018
43,269
47,000
U/C
18,750
6,068
0
0
0
0
0
0
0
12,409
Based on Full-Service Equivalent Rental Rates
Warehouse
Flex
Preleased %
0
6,068
0
0
0
0
0
0
0
6,068
Historical Rental Rates
Average Bldg Size
Warehouse
Total
Total
$11.00
$10.00
Dollars/SF/Year
$9.00
$8.00
$7.00
$6.00
Construction Activity
The Atlanta Industrial market saw
no new deliveries at the close of the
fourth quarter. Year-to-date deliveries
total over 1.5 million square feet of
product to the market.
Currently there is only 24,818 square
feet of space under construction, down
slightly from the previous quarter. At
this same time last year, there was over
1.5 million square feet underway in
Atlanta.
The two projects currently underway at
the end of the fourth quarter 2009 are
1170 Canton Road, a 18,750 square
foot building with 0% of its space
pre-leased, and 253 Swanson Drive, a
6,068 square foot facility that is 100%
pre-leased.
$5.00
$4.00
Future Deliveries
$3.00
$2.00
$1.00
30,000
$0.00
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008 1Q 2008 2Q 2008 3Q 2008 4Q 2009 1Q 2009 2Q 2009 3Q 2009 4Q
Thousands of SF
1997
Market Highlights
Building
Submarket
I-20 W/Douglasville Ind
S Clayton/Henry County
Airport/North Clayton Ind
Duluth/Suwanee/Buford
Square Feet
744,331
402,000
180,300
148,439
Tenant Name
N/A
Deere & Company
Clorox Products
Alpha Technologies
Significant Fourth 2009 Construction Deliveries
Building
Submarket
Square Feet
Occupied
No Deliveries this Quarter
Significant Fourth Quarter 2009 Properties Under Construction
Building
Submarket
1179 Canton Road
253 Swanson Drive
Northwest Atlanta
Northeast Atlanta
20,000
15,000
10,000
5,000
Significant Fourth Quarter 2009 Lease Transactions
Westpoint Building A
Westridge Distribution Center
Southside Distribution Center - Tradeport
Shawnee Ridge J-1
25,000
Square Feet
20,000
6,068
Build on the power of our network.™ Over 325 offices worldwide.
Delivery
1st Qtr 2010
1st Qtr 2010
2010 1Q
2010 2Q
Quoted Rental Rates
The average quoted asking rental rate
for available Distribution space was
$3-$4.50 per square foot per year at
the close of the fourth quarter 2009.
Bulk Warehouse rates were reported
at $2.25-$3.15 per square foot.
The average quoted rate within the
Flex sector was $4.50-$8.50 per
square foot.
Total
Atlanta Industrial Market Statistics
Total Industrial Market Statistics
Existing Inventory
Market
# Blds
Fourth Quarter 2009
Vacancy
Total RBA
Direct SF
Total SF
Vac %
YTD Net
YTD
Under
Leasing
Absorption
Deliveries
Const SF
Activity
Central Atlanta Ind
272
17,060,584
1,003,348
19,202
1,022,550
6.0%
(16,796)
0
0
116,404
Chattahoochee Ind
417
21,004,027
1,336,435
33,440
1,369,875
6.5%
(367,673)
0
0
316,071
3,515,286
I-20 W/Fulton Ind
884
89,311,787
13,067,711
537,954
13,605,665
15.2%
(892,664)
75,680
0
North Central Atlanta Ind
464
23,678,073
3,088,334
150,565
3,238,899
13.7%
(190,453)
0
0
603,209
2,018
156,263,393
16,541,470
918,109
17,459,579
11.2%
(858,489)
349,000
0
4,912,715
1,614,762
Northeast Atlanta Ind
Northwest Atlanta Ind
910
55,321,266
7,763,615
214,329
7,977,944
14.4%
(1,245,672)
573,783
18,750
Snapfinger/I-20 East Ind
428
33,292,100
4,232,264
41,401
4,273,665
12.8%
(511,672)
0
0
797,523
1,167
140,680,821
19,488,995
927,542
20,416,537
14.5%
656,422
550,000
0
3,627,034
South Atlanta Ind
Stone Mountain Ind
Totals
472
25,973,895
3,488,486
56,298
3,544,784
13.6%
(715,588)
0
0
484,145
7,032
562,585,946
70,010,658
2,898,840
72,909,498
13.0%
(4,142,585)
1,548,463
18,750
15,987,149
FlexMarket
Market
Statistics
Flex
Statistics
Existing Inventory
Market
# Blds
Total RBA
Vacancy
Direct SF
Total SF
Vac %
YTD Net
YTD
Under
Leasing
Absorption
Deliveries
Const SF
Activity
Central Atlanta Ind
59
2,621,828
188,244
0
188,244
7.2%
33,241
0
0
39,605
Chattahoochee Ind
76
2,526,872
230,234
0
230,234
9.1%
(39,859)
0
0
55,705
I-20 W/Fulton Ind
50
2,407,666
263,316
0
263,316
10.9%
(17,247)
0
0
73,324
145
7,329,441
1,292,283
22,109
1,314,392
17.9%
(175,770)
0
0
206,293
Northeast Atlanta Ind
386
14,760,257
2,660,642
109,425
2,770,067
18.8%
(29,854)
0
0
400,357
Northwest Atlanta Ind
173
7,520,431
1,157,434
126,102
1,283,536
17.1%
(266,338)
0
0
339,423
North Central Atlanta Ind
Snapfinger/I-20 East Ind
South Atlanta Ind
54
1,882,341
107,644
33,001
140,645
7.5%
0
0
31,804
100
3,206,079
288,992
0
288,992
9.0%
(149,837)
0
0
53,488
90
2,992,662
693,448
36,450
729,898
24.4%
(395,567)
0
0
72,079
1,133
45,247,577
6,882,237
327,087
7,209,324
15.9%
(1,017,048)
0
0
1,272,078
Stone Mountain Ind
Totals
24,183
Warehouse
Market
Statistics
Warehouse
Market
Statistics
Existing Inventory
Market
# Blds
Total RBA
Vacancy
Direct SF
Total SF
Vac %
YTD Net
YTD
Under
Leasing
Absorption
Deliveries
Const SF
Activity
Central Atlanta Ind
155
11,838,591
543,210
19,202
562,412
4.8%
(2,753)
0
0
76,799
Chattahoochee Ind
308
17,156,450
1,061,331
0
1,061,331
6.2%
(299,504)
0
0
260,366
1,464,053
I-20 W/Fulton Ind
549
65,259,158
10,177,834
445,074
10,622,908
16.3%
(1,745,660)
0
0
North Central Atlanta Ind
204
10,606,204
1,264,500
104,550
1,369,050
12.9%
(46,086)
0
0
204,201
1,040
106,727,441
9,340,690
673,788
10,014,478
9.4%
(1,166,763)
349,000
0
3,151,455
740,454
Northeast Atlanta Ind
Northwest Atlanta Ind
509
35,407,094
5,283,956
14,209
5,298,165
15.0%
(395,976)
573,783
18,750
Snapfinger/I-20 East Ind
265
24,771,398
3,423,342
8,400
3,431,742
13.9%
(464,834)
0
0
509,907
South Atlanta Ind
784
110,072,987
15,714,720
546,082
16,260,802
14.8%
(366,698)
92,000
0
2,412,858
Stone Mountain Ind
Totals
202
14,564,340
1,229,690
15,023
1,244,713
8.5%
(150,858)
0
0
154,584
4,016
396,403,663
48,039,273
1,826,328
49,865,601
12.6%
(4,639,132)
1,014,783
18,750
8,974,677
Shallow-Bay
Distribution
Market
Statistics
Shallow-Bay
Distribution
Market
Statistics
Existing Inventory
Market
# Blds
Total RBA
Vacancy
Direct SF
Total SF
Vac %
YTD Net
YTD
Under
Leasing
Absorption
Deliveries
Const SF
Activity
Central Atlanta Ind
58
2,600,165
271,894
0
271,894
10.5%
(47,284)
0
0
Chattahoochee Ind
33
1,320,705
44,870
33,440
78,310
5.9%
(28,310)
0
0
0
I-20 W/Fulton Ind
285
21,644,963
2,626,561
92,880
2,719,441
12.6%
75,680
0
1,977,909
North Central Atlanta Ind
115
5,742,428
531,551
23,906
555,457
9.7%
31,403
0
0
192,715
Northeast Atlanta Ind
592
34,775,695
4,540,138
134,896
4,675,034
13.4%
338,128
0
0
1,360,903
534,885
870,243
0
Northwest Atlanta Ind
228
12,393,741
1,322,225
74,018
1,396,243
11.3%
(583,358)
0
0
Snapfinger/I-20 East Ind
109
6,638,361
701,278
0
701,278
10.6%
(71,021)
0
0
255,812
South Atlanta Ind
283
27,401,755
3,485,283
381,460
3,866,743
14.1%
458,000
0
1,160,688
0
0
257,482
533,680
0
5,740,394
Stone Mountain Ind
Totals
180
8,416,893
1,565,348
4,825
1,570,173
18.7%
1,883
120,934,706
15,089,148
745,425
15,834,573
13.1%
1,172,957
(169,163)
1,513,595
All data for text, charts & graphs provided by ©CoStar Property.
Brannen Goddard
Commercial Real Estate Services, Worldwide.
tel 404 812 4000
fax 404 816 3939
www.naibg.com
Suite 1100
5555 Glenridge Connector
Atlanta GA 30342