Could Buckhead be ready for new office towers? These landlords think so.
Building new office towers was a nonstarter in the wake of the COVID-19 pandemic, when Atlanta was flooded with unwanted workspace.
But that’s starting to change.
The head of Atlanta-based Cousins Properties, the city’s largest office landlord, told investors Friday that one of the company’s goals for 2026 is to kick start a new office project. The location hasn’t been determined among Cousins’ portfolio of Sunbelt cities, but Buckhead was floated as an appealing possibility.
“We hope to identify a new development start that can break ground in late 2026 or 2027,” Cousins CEO Colin Connolly said on a fourth quarter investors call. “Large users with 2029 and 2030 (lease) expirations are facing a significant shortage of large blocks of premier space and will likely need to consider new construction.”
“We hope to capitalize on this dynamic,” he continued.
Cousins isn’t alone. North Carolina-based Crescent Communities announced Friday a project featuring more than 300 apartments and a 21-story office tower at the corner of Peachtree and Wieuca roads near Phipps Plaza.
The prospect of new office space was unthinkable for much of the past five years. Like many cities, Atlanta set records for its amount of vacant office space after the pandemic sent white collar employees to work from home and many stayed remote.
The lack of demand coupled with rising construction costs made new office projects nearly impossible to finance through traditional sources. The only new workspace poised to join Atlanta’s market this year is 224,000 square feet within Rockefeller Group’s 60-story 1072 W Peachtree tower in Midtown.
Office towers take two years or so to build, so any new project started in the next year or so won’t add to the region’s supply until the end of this decade at earliest.
Connolly said the lack of new supply presents a tantalizing opportunity, especially because more companies are implementing stringent return-to-office mandates. Home Depot, which is based in Vinings, last week became the latest Fortune 500 company to eliminate its work-from-home policies.
Plus, given the lack of cranes swinging girders, any new project is poised to face little competition when trying to attract tenants looking for the cream of the crop.
“Any meaningful increase in new supply is four to five years away,” Connolly said. “The new result of these trends will be a shortage of high quality space that will be particularly acute in 2028, 2029 and 2030.”
Cousins isn’t the only one pushing to be on the forefront of new office development.
Crescent’s project would rise on land owned by the Church of Wieuca. The company is picking up a plan that was set in motion several years ago by a different developer but never came to fruition.
“I think this will be one of a few, and eventually many, new office opportunities that start to emerge as we enter a new office cycle for Buckhead and Atlanta at large,” Crescent managing director Sagar Rathie told The Atlanta Journal-Constitution.
‘Pendulum start to swing’
Although optimism for an office rebound is increasing, Atlanta’s office market still faces many challenges.
About a quarter of the region’s office square footage is vacant. That figure is even higher when accounting for unwanted space advertised for sublease. Many buildings, especially older ones, face loan issues and are on the brink of foreclosure.
Newer buildings have performed much better in comparison, attracting tenants willing to pay for top-quality space. The number of lease renewals and expansions are starting to increase, despite recent corporate downsizing, as employers call their workers back to the office.
“We’re seeing the pendulum start to swing the other way, where there’s more expansion conversations probably because there was too much of a downsize that happened,” said Kyle Kenyon, senior vice president of real estate services firm CBRE’s Atlanta Brokerage Group.
The office market posted positive absorption — an industry metric for how much net space is either leased or vacated — for all but one-quarter in 2025, according to CBRE, which is a positive sign after years of being in the red.
Cousins completed 700,000 square feet of leases during the fourth quarter, and more than half that activity was in the Atlanta area. The 361,000 square feet of leases inked here between September and December was the most by Cousins since the first quarter of 2019, Cousins Executive Vice President Richard Hickson said.
The largest of those leases was a 166,000-square-foot signing by AT&T at the Northpark complex in Sandy Springs. Hickson hinted the momentum should continue.
“The amount of activity we have in lease negotiations is at its highest level in five years,” he said.
An inflection point
Traditionally the Atlanta area’s ritziest office market, Buckhead has recently been surpassed.
The fast-developing high-rise districts in Midtown and West Midtown command the highest rents in the region, but they also have some of the largest amounts of vacant high-end space, according to CBRE. Buckhead has a vacancy rate of about 16% among its top-quality space, which is often called class A or trophy.
Connolly said digging beneath the surface shows Buckhead could quickly become tight, especially for large prospective tenants.
“There’s not a single block of space over 100,000 square feet today in a class A building,” he said of Buckhead. “So, I do think you’re going to start to see some increases in rental rates that will justify new construction for some large users that have no other alternatives.”
He mentioned Dallas and Charlotte as potential options for new office development, as well. Cousins last week paid more than $317 million to acquire a trophy tower in Charlotte.
Cousins’ office portfolio ended 2025 at 88.3% occupied, and Connolly said the company aims to eclipse 90% by the end of the year.
He added that companies based in New York City and the West Coast have showed renewed interest in moving their office operations to Sunbelt cities like Atlanta, which command cheaper rents by comparison. Connolly said it takes only a few of those companies to announce relocations to leave cities like Atlanta with a lack of high-end space, even if a glut of lower-quality space remains available.
“We believe we’re close to an inflection point where it will very much become a landlord’s market,” he 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.
