Bank of America Plaza is Atlanta’s tallest skyscraper — and these days one of its loneliest.
Though the 55-story tower’s soaring gold-leaf spire still glitters from afar, the building is nearly half empty. Two thousand workers, perhaps more, have left in recent years as tenants downsized or moved, emptying whole floors.
Those who remain enjoy quick elevator rides, short cafeteria lines and ample parking. But a building that once symbolized Atlanta’s business vitality now stands as a 1,023-foot-tall monument to the real estate bust, and a measure of the region’s halting recovery.
A year ago the tower at the border of downtown and Midtown suffered the ignominy of becoming the tallest U.S. building foreclosed since the recession. Occupancy is down since then, and at least two more major tenants could walk.
“That tower lined up with the ascension of Atlanta as being seen as a Southern city to one with global recognition,” Mercer University economist Roger Tutterow said. The problem is that the region’s commercial center has marched steadily north since the tower opened in 1992, he added, and in the wake of the recession metro Atlanta isn’t growing jobs fast enough to fill its glut of offices.
“The dynamics changed,” Tutterow said.
Since the foreclosure, a new company has come in to stabilize and revamp the skyscraper, giving real estate observers hope. Yet the iconic tower at Peachtree Street and North Avenue still stands at a crossroads.
Metro Atlanta’s office market was ravaged by the implosion of the building and investment boom that followed the economic crash. Companies cut workers and office space.
Now there appear to be fewer big-fish tenants seeking large blocks of office space, and fewer prospects for out-of-state relocations, said Henry Lorber, a distressed real estate expert with Hays Financial Consulting in Atlanta.
Bank of America Plaza doesn’t have the amenities of newer competitors, he said, and apparently rental rates haven’t been cut to a point that will lure companies from other sites.
Competition for tenants is cutthroat. The empty top-tier — or Class A — office space in metro Atlanta would equal 14 Bank of America Plazas. That doesn’t include the lower-grade space that’s available.
The tower’s 48.6 percent vacancy rate far exceeds the region’s nearly 20 percent rate, which remains about 7 or 8 points above what is considered normal. The former owners, who paid a record price for the building at the very top of the market in 2006, couldn’t compete when the economy cratered and rival building owners coaxed tenants away with sweetheart deals.
The office market is a barometer of the broader economy. Companies typically rent what they need or expect to need in the near future.
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