Q. Has the Central Perimeter office market recovered from the recession? What is the vacancy rate in the area? How does that compare with the past?
I do not think it is safe to say anyone has recovered from the recent recession. However, from an office space perspective, we are in much better shape than we were in during the prior three to four years.
The overall office vacancy is still hovering slightly below 20 percent; however, this is an improvement and many companies are starting to grow in the area. In fact, every building we represent in the submarket has at least two or three tenants that have recently expanded or are in the process of expanding.
Q. What are the advantages of this market for businesses relocating or expanding?
The advantage of Central Perimeter is the fact that it falls right in the sweet spot when companies run a ZIP code analysis of where their employees live. It is the first submarket north of the urban markets of Buckhead, Midtown and Downtown that has free parking — and much of that deck parking. The access to MARTA rail, the best collection of hospitals in the state, abundant amenities and quality housing are all significant strengths of the area.
Q. What are the biggest problems faced by property owners in the area?
The main challenge that faces this submarket (and most others in Atlanta) will continue to be traffic. The half-diamond interchange at Hammond Drive and Ga. 400 has definitely helped travel time for folks exiting the area during rush hour; however, the Ga. 400/I-285 interchange will continue to be stressed at peak traffic times.
Q. Are there certain types of businesses that are better suited for this market?
Clearly the submarket is probably best suited for Fortune 500-type companies, as evidenced by the headquarters in the area — UPS, Newell Rubbermaid, Cox Enterprises and First Data, just to name a few. It provides for the best access to executive housing to the south and employee housing to the north, and really in all directions.
Q. How big a problem is traffic when trying to convince businesses to relocate to the Perimeter area?
As referenced earlier, traffic is an issue. However, I do not believe traffic in the Central Perimeter submarket is significantly better or worse than any other submarket in metro Atlanta at peak traffic times.
When companies are looking at relocating to the Southeast or within Atlanta, the Central Perimeter submarket is always included on just about everyone’s radar and frankly, traffic concerns are usually not at the top of folks’ lists. The main drivers are economic incentives, proximity to housing for employees and access to amenities.
Thomas W. Miller, executive managing director for Newmark Grubb Knight Frank’s Office Agency Group, oversees marketing and leasing for Class A office projects located throughout metro Atlanta. He has more than 19 years of experience in commercial real estate.