Why staying put has become en vogue in Atlanta’s complicated office market
The past few years have been full of reasons for office users to hesitate when making decisions.
Between an unprecedented pandemic, the rise of remote work, political whiplash and concerns about trade and the broader economy, it’s no surprise companies are thinking twice before making commitments.
Leasing activity declined in the Atlanta area during 2025, dipping nearly 11% compared to the year prior, according to data from real estate services firm Cushman & Wakefield. But when companies are making decisions on their workspace, more are opting to avoid change and stick with what they know.
“New leasing right now isn’t necessarily telling the whole story. The renewal activity is really strong and healthy,” said Audrey Giguere, senior research manager for Cushman & Wakefield. “Companies are recommitting to their space.”
Despite overall leasing being down, office lease renewals in metro Atlanta more than doubled during the fourth quarter compared to the third quarter. It’s the biggest jump in lease renewals since the office market bottomed out in 2023. The fourth quarter’s surge in renewals highlights how the most attractive workspace for many companies, especially when the future is cloudy, might be their current one.
Even so, a new coat of paint doesn’t hurt, which is why many office landlords are pumping cash into renovating their spaces.
It’s an effort for aging, but still nice and attractively located buildings, to allure tenants or increase the odds of retaining the ones they have. Refreshed spaces are widely seen by office brokers and tenant representatives as a necessary investment in a post-pandemic world, especially when more than 31% of all office square footage in metro Atlanta remains on the market, according to real estate services firm CBRE.
Kyle Kenyon, senior vice president of CBRE’s Atlanta Brokerage Group, said a refresh can be all a building needs to cultivate some vibrancy.
“Tenants walk in there and they’re like, ‘Wow, this is why we’re looking for office space,’” he said. “This vibe, this buzz, this energy — that’s an amenity within itself.”
Four of the five largest office lease signings in metro Atlanta during the fourth quarter were renewals, according to real estate services firm JLL. The largest was by global law firm Kilpatrick Townsend & Stockton, which renewed its 148,000 square-foot-lease at the 1100 Peachtree tower in Midtown.
Spear Street Capital acquired the roughly 35-year-old skyscraper in May and began a $14 million lobby renovation. A refresh of the building’s conference center and fitness center is also underway. The 28-story tower is currently 76% leased.
Brooke Dewey, executive managing director of agency leasing for JLL in Atlanta, said the renovations mirrors activity happening in other aging, but still high-end and attractively located, office spaces.
“It’s to earn the business so to speak,” she said.
New buildings continue to demand the highest rents and splashiest tenant signings, but it’s not all peachy for the cream of the crop.
It is taking longer than usual to fill many new office buildings in urban submarkets like West Midtown and Midtown, said Jonathan Koes, who leads the Atlanta research team at real estate services firm Colliers. New towers, which are often called trophy, tend to fully lease within two years.
“We’re getting to almost 24 months, if not 36 months, for some of these buildings,” he said.
CBRE reports 42% of West Midtown’s trophy space was vacant at the end of the year, followed by downtown at 35%. In contrast, suburban markets in Central Perimeter and Cumberland Galleria are tight and less than 5% vacant.
“If these new buildings aren’t well located or easily accessible, I think they’re going to have a tougher time attracting tenants when there are other options other there, especially as vacancy marketwide is still near a record peak,” Koes said.
Many brokers are optimistic that trends are pointing in the right direction despite those cracks. The office market posted positive absorption — an industry metric for how much net space is either added or subtracted — for all but one quarter in 2025, according to CBRE, which is a positive sign after years of being in the red.
Ken Ashley, an executive director for Cushman & Wakefield, said conversations on downsizing and whether to return to the office after COVID-19’s disruptions have become relics of a bygone era.
“Instead of figuring out how much we’re going to cut, they want a path for growth,” he said. “So the script has flipped.”
Dewey echoed that point, saying more C-suite leaders are “putting the hammer down” with more strict in-person work requirements. Zach Wooten, an executive director at Cushman & Wakefield who works with landlords, said his team is currently working on more expansions than the past few years combined.
“We still have a cough,” Ashley said of Atlanta’s office market. “But we’re getting over the cold.”
There’s also almost no new office space under construction, which is expected to eventually pressure prospective tenants to look at buildings with more vacancy because that’s all that’s available. The only new workspace poised to join Atlanta’s market this year is 224,000 square feet within Rockefeller Group’s 1072 W Peachtree tower in Midtown.
Chris Ahrenkiel, managing principal of Cushman & Wakefield in Atlanta, said it will likely be four or five years before another new office building is built in Atlanta. All the while, tenants are showing that macroeconomic changes that would have slowed down decision-making the past is starting to wane.
“It feels like the business leaders have sort of been numbed to external events because there’s so much stuff happening that they no longer (see) those as being gigantic disruptions or reasons not to make decisions,” Ahrenkiel said.
About the Author
Zachary Hansen, a Georgia native, covers economic development and commercial real estate for the AJC. He's been with the newspaper since 2018 and enjoys diving into complex stories that affect people's lives.
