Atlanta Office Market
The Atlanta office market ended 2016 on a strong note, as all metrics moved in positive directions and overall demand remained high. The market's overall vacancy rate fell to 16.8%, down from 17.1% in the previous quarter and from 17.4% one year ago. The average asking rental rate increased to $23.71/SF from $23.46/SF last quarter and was well above the average rate of $22.48/SF at the end of 2015. While each class saw significant gains over the year, the quarterly increase was largely driven by rent growth in the Class B sector.
Atlanta Industrial Market
Atlanta's industrial market ended 2016 on a solid footing, as the year's overall fundamentals were strong. The overall vacancy rate rose over the fourth quarter to 8.9% from 8.0% and was up from 8.2% one year ago. This increase was driven by the 5.9 million square feet of new vacant space delivered to the market; the 7.0 million square feet delivered during the quarter was the highest total recorded since NGKF began tracking the market. While the rise in vacancy may at first appear cause for concern, it is important to note the move-ins that will result in positive absorption and a lower vacancy rate in first-quarter 2017.