Office Rents Could Increase 20 Percent

BUCKHEAD, GA -- A group of commercial real estate executives believe that Buckhead’s office rents will only get more expensive during the next two years, according to a report.

Top-grade office space currently sells for about $40 a foot, but rents could be up to 20 percent higher in 2017 than they were in 2015, according to Tishman Speyer’s Chris Ahrenkiel, who spoke at the Bisnow Future of Buckhead forum.

Ahrenkiel said that the rent increases can be attributed to the looming addition of 200,000 new jobs to the area and a hot market that’s seen nearly $2 billion in sales, according to BuckheadView.

Regent Partners founder David Allman said the days of good deals in Buckhead are over, but added that $40 a square foot for a Buckhead office is still a financially sound move compared to prices in other markets, according to BuckheadView.

Last year, Panelists from Tishman Speyer and Regent Partners said that once their projects Three Alliance Center and an unnamed mixed-use development next to the Buckhead MARTA station are complete, there won’t be any prime real estate left in the area.

With the central business district drying up, developers have since set their sights on Buckhead Village. OliverMcMillan’s powerhouse Buckhead Atlanta retail development opened in the area last year and has become the new hotbed of development activity in the city.

JLB Partners recently announced plans to transform a lot at 99 West Paces Ferry Road into a mixed-use development anchored by a residential tower with street-level retail due to the property’s location.

The Loudermilk Companies said they plan to develop two city blocks into a medical office tower, office space, and boutique hotel.