ATLANTA (Dec. 7, 2010) – Rental rates for office and industrial space have flattened and should not decrease further in 2011. That’s the sentiment from several Carter brokers who today discussed where rents are headed during Carter’s Brokerage Services biweekly meeting.
“Rents are still pretty flat. They’re bumping along the bottom,” said Carter Senior Vice President Kirk Diamond, who heads Carter’s office tenant rep group. They’re not going down anymore, but they’re certainly not going up.”
And free rent still is available, Diamond said. He just completed a lease that includes some free rent on behalf of Lane Co., firm that owns and manages apartments. Lane inked a new headquarters deal at Sterling Point in Atlanta’s Central Perimeter Market.
The story is similar on the industrial side, according to Associate Wills Allen and Senior Vice President Skip Petters. “Rental rates continue to drift down a little bit, but they are starting to flatten,” Allen told his fellow brokers.
He’s seeing a lot of renewals in the Northeast submarket along I-85. “It’s not booming up there by any means, but it’s steady.”
When tenants do decide to get new space, “the majority of the deals are just companies moving from Space A to Space B,” Petters added. These deals likely don’t create positive absorption, “but it’s a transaction.”
Tenants that move typically are getting better spaces and still are “beating up the landlord” a little during negotiations, Petters said.
But with rents flattening, we should see a little less landlord abuse next year.