Buildings now under way include the 800,000-square-foot office component of Daniel Corp./Selig Enterprises Inc./Canyon-Johnson Urban Funds' $2 billion mixed-use 12th & Midtown project. The 38-story tower will open in late 2009 or early 2010, according to Daniel Corp. Vice President Doug Guedry, who reports that a letter of intent for a three-floor, 81,000-square-foot user is in the works "and we are close on a couple of other deals."
Moving north, there's a large block of vacant space, albeit not exactly "new," in the pipeline at the high-profile corner of Peachtree and 14th streets. Following the $98 million September deal in which Chicago-based Transwestern Investment Co. LLC. acquired the 439,388-square-foot Campanile, seller AT&T Inc. is vacating the building, leaving about 308,000 square feet empty as of the first quarter. The Atlanta office of Transwestern, a related commercial brokerage firm, is repositioning the building from its longtime use as a corporate headquarters facility into a building that competes in the Midtown leasing market.
Other new space on the way in Midtown includes the 535,000-square-foot 271 17th St. building, the third office building in Atlantic Station. Slated for completion in 2009, this building will
be anchored by BB&T, which has signed on for 80,000 square feet; and the Ford & Harrison LLP law firm, which recently inked a deal for 52,000 square feet.
Meanwhile, across the Downtown Connector at Spring and 17th streets, Daniel Corp. and Selig have joined up with MetLife to develop some 550,000 square feet of office space as part of the first phase of Metropolitan Center, a project that will ultimately incorporate more than 1.2 million square feet of office with retail stores, hotel and residential units.
The developers are hammering out a construction schedule for the project, according to Daniel Corp. Senior Vice President for Atlanta Operations Steve Baile, "and our objective is to deliver the first phase sometime during 2010."
In the deals department, as part of its recently announced headquarters move from London to Atlanta, Invesco Plc will consolidate its existing metro-area offices into about 178,000 square feet in Dewberry Capital Corp.'s previously near-empty Two Peachtree Pointe.
The impact of this move on Midtown is close to neutral, though; the global investment manager will also be vacating about 131,000 square feet at nearby One Midtown Plaza, and has put its 45,000-square-foot local headquarters building at 1315 Peachtree St. on the market for sale.
Potential tenants scouting Midtown these days are mainly law firms, financial services companies and consultants, according to Guedry. Several of these groups are looking to move from locations in Buckhead, he reports, "because the traffic situation there is killing them -- Buckhead doesn't have the established street grid system that Midtown has, and as a result you're much more likely to get stuck in traffic."
The substantial amount of space coming on line in Midtown may be a bit too much to be promptly absorbed by these and other types of tenants, according to Colliers Spectrum Cauble Inc. Vice President Pete Shelton.
During the past four years, demand from downtown Atlanta law firms for new Midtown locations has been the major driver pushing office space absorption in Midtown to record levels, Shelton said, "but I don't think that pace is going to be sustainable over the next few years," he says.
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source: bizjournals.com
