Big AT&T Lease Takes No. 2 Spot In 10 Biggest Atlanta Office Leases Of 2021
The year 2021 in Atlanta’s office market was defined by companies expanding into the region, hoping to tap into its combination of talent base, low-tax environment and affordability.
But before the calendar turns, the second-largest lease of the year closed, Bisnow can first report: AT&T dialed in a renewal for 435K SF of office space across two buildings at Lenox Park in Buckhead.
The deal was eclipsed only by Carvana’s sublease of nearly 600K SF from State Farm at the insurance giant’s new campus in Central Perimeter, an expansion emblematic of Atlanta’s banner year.
The economic momentum of this past year is likely to continue into 2022, especially as executives start pushing their employees more forcefully back to offices and out-of-state companies start opening their new Atlanta operations, JLL Executive Vice President Brooke Dewey said.
“I feel like it's going to be a rocket booster come Jan. 4,” said Dewey, who represented landlord MetLife in leasing the Midtown Union project to anchor Invesco in 2019. “We have been really, really busy in the fourth quarter. For those companies that have pushed off decisions … are obviously going to get refocused.”
Atlanta's office market started 2021 off to a slow start, with companies emptying more space than they were occupying in the first half of the year. By the third quarter, though, Atlanta landlords saw a dramatic shift, with 1.17M SF of positive absorption. While the fourth quarter will not officially end until Dec. 31, there's evidence that the final quarter of 2021 could be even stronger: There has been at least 3M SF in leasing activity, according to Lee & Associates.
New corporate offices from Micron, Visa, Cisco and a planned Microsoft campus on Atlanta's Westside highlighted the economic development wins for Metro Atlanta and the promise of thousands of new jobs.
“With all of these job announcements, Atlanta is still a hot market,” Avison Young Southeast Region Lead Sara Barnes said.
Here are the top 10 office leases of 2021, compiled by Colliers Atlanta and Bisnow research.
10. Novelis
Size: 95,742 SF
Building: One Phipps Plaza
Submarket: Buckhead
Lease type: New
The aluminum giant inked a deal for Simon Property Group's under-construction, 13-story office tower as part of the larger redevelopment of its high-end Phipps Plaza mall. Novelis will downsize from 125K SF at Two Alliance Center as the company adopts a permanent shift to a hybrid work model, company officials told the Atlanta Business Chronicle.
Size: 97,792 SF
Building: 171 17th St.
Submarket: Midtown
Lease type: Renewal
The vaunted Atlanta law firm again renewed its lease at Atlantic Station, where it has been since the tower was developed in 2004. AGG locked in an early renewal, as its lease was originally set to expire in 2024, KBS Realty Advisors Senior Vice President Allen Aldridge said. AGG and KBS came to terms on the early renewal in 2020, but the pandemic delayed the parties executing the lease until this year, Aldridge said.
8. Swift Curie McGhee & Hiers LLP
Size: 100K SF
Building: Pershing Park Plaza
Submarket: Midtown
Lease type: New
Swift Curie decided in October to pack its bags at the 21-story Peachtree Tower at 1355 Peachtree St. — where it has been for 30 years — and sign a lease at Pershing Park Plaza, the 160K SF mid-rise right at the nexus of Peachtree and West Peachtree streets. Pershing Park's previous anchor tenant, Jones Day, moved last year into a new office building at Colony Square. Smith Curie is tied with AGG as the eighth-largest Atlanta-area law firm.
Size: 115K SF
Building: Coda
Submarket: Midtown
Lease type: New
In a deal first reported by Bisnow, Cisco plans to open a Talent and Collaboration Center at Portman Holdings' $375M high-tech Coda tower at Tech Square. The tech firm announced in October it would bring 700 new jobs to Atlanta, part of a host of tech companies flocking to Midtown in their chase for talent. Cisco's lease brought the 750K SF tower, which includes an urban data center, to essentially 100% occupied.
6. Visa
Size: 123K SF
Building: 1200 Peachtree St.
Submarket: Midtown
Lease type: New
The digital payments and credit card giant also expanded its reach into Midtown Atlanta. The firm is taking space at 1200 Peachtree St., a tower owned by Cousins Properties that was formerly leased to Norfolk Southern for its Atlanta operations. Norfolk Southern announced in 2018 that it was moving its headquarters to Atlanta and has since moved into a new 750K SF tower off West Peachtree Street in Midtown, developed by Cousins. Visa expects to add 1,000 new jobs at its new Atlanta location over the next few years.
5. Hapag-Lloyd
Size: 123K SF
Building: Three Ravinia Drive
Submarket: Central Perimeter
Lease type: New
While Hapag-Lloyd has long had an office in Atlanta, the international shipping company announced it was moving its North American headquarters to Atlanta earlier this month, adding 250 jobs over the next few years. In doing so, the company is establishing its global brand in Central Perimeter at the 817K SF pagoda-like tower owned by Preferred Apartment Communities. Hapag-Lloyd plans to move its workers to Three Ravinia from its Quality Service Center at 5515 Spalding Drive in Peachtree Corners.
4. Center for Global Health Innovation
Size: 200K SF
Building: Tower Square
Submarket: Midtown
Lease type: New
The Atlanta-based nonprofit announced this month that it was opening a new global health district in Midtown at the former AT&T tower at 675 West Peachtree St. The CGHI's new district will have a 75K SF conference center and café, as well as office and laboratory space for nongovernmental organizations, universities, health systems, venture funds and other health-driven organizations. CBRE's Chris Port, Kyle Kenyon and Alex Port represented Tower Square's owner, billionaire Carl Icahn's Icahn Enterprise Holdings.
Size: 220K SF
Building: 5995 Windward Parkway
Submarket: North Fulton
Lease type: New
Following its merger with Columbus-based Total System Services in 2019, fintech giant Global Payments consolidated a number of its Atlanta offices into Grubb Properties' 5995 Windward Parkway building in Alpharetta. The company still maintains its headquarters at Three Alliance Center in Buckhead.
2. AT&T
Size: 435K SF
Building: Lenox Park
Submarket: Buckhead
Lease type: Renewal
Sneaking in at No. 2, AT&T renewed two leases for two office buildings at its longtime Buckhead campus. The telecom giant has been downsizing in Atlanta for some time, vacating its space at the former AT&T tower in Midtown. AT&T also vacated two of the five buildings on the campus in 2018.
1. Carvana
Size: 570K SF
Building: State Farm's Park Center I
Submarket: Central Perimeter
Lease type: Sublease
The online automotive dealership — which has one of its signature car vending machines in Midtown — surprised the Atlanta office market when it took over nearly 600K SF that State Farm decided it didn't need at its new Dunwoody campus. The insurance company's employees shifted to a remote work environment during the pandemic. Carvana's workers could start moving into the building in February, a State Farm spokesperson told Bisnow in September. "While we did not actively market Building 1 for sublease, the opportunity presented by Carvana allows us to realize significant cost savings,” the spokesperson said. State Farm still has more than 1M SF of office space at the campus.
