More of metro Atlanta's office space was filled by tenants than was vacated in 2011, the first time that’s happened for a full year since 2008, according to a report released Friday.
It wasn’t a big yearly gain in what insiders call absorption -- only 5,138-square feet, about the size of a very large house -- but any gain is good news in the current economy.
The metro office market has suffered from a litany of problems, including a building boom that brought new office towers to market right as the economy collapsed. Companies got leaner during the crash, and rents sank as vacancy rates soared.
Loans for some office buildings, such as Bank of America Plaza, remain distressed, and more pain is expected.
Comparatively, metro Atlanta saw 840,000 square feet of net occupancy gains in 2008, the last positive year.
The overall vacancy rate -- including vacant sublease space -- was 21.9 percent in December, down slightly from 22 percent at the end of 2010, the report by Cushman & Wakefield said.
Vacant sublease space, space still rented by a corporation but no longer in use, dropped 41 percent to 1.6 million square feet. Reducing this space can help make markets more stable.
John O’Neill, the new market leader for Cushman & Wakefield, said Atlanta "held it's own" despite economic pressure, citing improvements in subleased space and Class A, or prime, offices.
“Going forward, steady leasing activity and the lack of new construction should drive down vacancy rates as momentum builds throughout the year,” he said.
Annual leasing activity dipped about 2.2 percent, matching the 2.2 percent decline in overall rental rates. Investment sales soared more than 300 percent to 8.7 million square feet.
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