The Atlanta real estate market is experiencing significant momentum: this year, it’s both one of the best cities for working remotely in the U.S., as well as one of the most attractive office locations for tech companies big and small. And, although the city has not been untouched by the economic slowdown of the pandemic, office space for rent in Midtown Atlanta has been notably appealing to companies looking to lure some of the talent graduating from the various historically Black colleges and universities in the city, as well as from Georgia Tech and Georgia State University. In fact, deals closed throughout the pandemic attest to the value of high-quality office development meeting the robust local talent pool.
Cousins Signs VISA to 1200 Peachtree
VISA recently signed a lease for 123,000 square feet at the 1200 Peachtree building developed by Cousins Properties. Occupancy on the long-term lease is expected to begin in Q4 2022. The fintech giant’s efforts to establish a permanent office presence in the Atlanta market are expected to create 1,000 new jobs in the region throughout the next few years.
The developer acquired the property in 2019 from Norfolk Southern Corporation, which is scheduled to relocate into its new headquarters — also built by Cousins — before the end of this year. Following the transition, Cousins plans to reposition 1200 Peachtree for multi-customer use and align it with the rest of its leading trophy portfolio of class A office properties spread across the Sun Belt region.
“We are excited to see a financial technology leader like VISA focused on creating an exciting office environment for in-person collaboration,” said Colin Connolly, president and chief executive officer of Cousins. “Atlanta continues to attract large and growing companies recruiting new talent. The central location, proximity to renowned research institutions and accessibility that 1200 Peachtree offers is compelling for companies interested in the Midtown submarket.”
Microsoft Expands into Hines’ Atlantic Station
Last summer, Microsoft Corp. announced that it had taken a lease for 523,000 square feet at Hines’ Atlantic Yards project at Atlantic Station. Delivery for the space was scheduled for the second half of this year. Operations at the new location will focus on artificial intelligence and cloud services — a $75 million investment that looks to create about 1,500 jobs and drill down into Microsoft’s long-term plans for a significant presence in Atlanta.
Terrell Cox, general manager with Microsoft, said in a statement: “Atlanta has a rich culture and history of innovation, making it a unique place for tech growth.” The company also operates a cloud computing engineering center at the Coda building at Technology Square, and Microsoft maintains offices in Alpharetta, Ga., and Buckhead, Ga., as well.
Shhhh … here’s a lil’ sneak peek of the inside of our new campus. 🤫
We’re excited to open to the public in February 2022.
Thank you for having us, Atlanta! pic.twitter.com/jApqcxqVsp
— Microsoft Atlanta (@MicrosoftATL) August 9, 2021
Google Anchors 1105 West Peachtree
Similarly, Google anchored Selig Enterprises’ $530-million, tri-tower, mixed-use project at 1105 W. Peachtree, which was completed in September. The tech giant’s lease encompasses roughly 500,000 square feet across 19 floors of the class A+ office tower, which is located on the corner of West Peachtree and 12th Street. Joining Google on the 31-story building’s tenant roster is prominent local law firm Smith Gambrell & Russell, which has already begun moving into the new space. Google is expected to occupy its lease early next year.
Chris Ahrenkiel, executive vice president of development at Selig, secured both names before breaking ground.
“Early on in development, we received commitments from two high-quality office tenants, which validated the project’s purpose to provide the best office location for companies to recruit and retain top talent in their fields,” Ahrenkiel said. “In addition to our central location and efficient access, the project offers forward-thinking amenities, including a hospitality-inspired lobby, a variety of outdoor workspaces, and a vast selection of on-site dining options.”
Cisco in Talks for Major Midtown Atlanta Move
Portman Holdings is reportedly in talks with technology conglomerate corporation Cisco Systems for a lease at Coda at Tech Square. The $375-million tower is anchored by the Georgia Institute of Technology, which recently celebrated 20 years since the beginning of the Technology Square development. Bisnow reports that negotiations include roughly 80,000 square feet of state-of-the-art Atlanta office space at the West Peachtree Street high-rise. If finalized, this deal would bring occupancy at the property to nearly 100%. Cisco Systems’ local footprint already includes an office presence at The Pointe in Sandy Springs, Ga., as well as at Brookside Concourse in Alpharetta.
Why Unicorns Thrive on the Atlanta Tech Scene
Our 2019 analysis of the best U.S. cities for startups found that budding enterprises in Atlanta had the highest survival rate in the country. Specifically, an estimated 65.1% of firms with four employees or fewer were active past their first year. The city also ranked second-best for tech employment growth, following a 38% increase in computer, engineering and science jobs in five years.
While high-profile West Coast tech scenes are perpetually represented as a permanent destination for venture capital, the Atlanta ecosystem built up quality organically through strong community education and a “pay-it-forward” mindset. Moreover, Atlanta entrepreneurs who achieved success were more likely to reinvest in the community than to exit the scene altogether. Such was the case for David Cummings, who sold his B2B marketing automation company Pardot for nearly $100 million in 2012 and then proceeded to create a coworking space for entrepreneurs called Atlanta Tech Village. Since then, the Village has grown into a curated community of more than 1,000 entrepreneurs, nurturing success stories like Calendly and SalesLoft.
“The Southeast is 24% of the U.S. GDP, but only accounts for 7% of the venture investment,” said Blake Patton, founder of Atlanta-based investment firm Tech Square Ventures, as quoted by TechCrunch earlier this year. “With the recent momentum in the region, that is changing, and investors are taking notice and backing local managers who, in turn, are investing in the region’s best and brightest entrepreneurs.”
In what is one of the biggest acquisitions of a local-grown tech company, Mailchimp was purchased by Intuit last month for $12 billion. The digital marketing company launched in 2001 as a tiny business focused on creating email greeting cards. Now, it stands as a continuing testament to the strength of Atlanta talent and values.
Additionally, Atlanta-based fintech platform Greensky went public in 2018 at a valuation of about $4 billion. And, last month, Goldman Sachs entered into an agreement to acquire the digital lender in an all-stock deal valued at more than $2 billion.
As more and more homegrown enterprises strike it big, the Atlanta startup scene is poised to benefit from increased availability of mentorship, incubation networks and the early-stage funding that the highly abundant local talent deserves.