Office vacancy in the Atlanta metropolitan area reached 19% atthis year's midpoint, with direct vacancy increasing only slightlyin the second quarter to 16.3%, according to Jones Lang LaSalle.New office deliveries outpaced demand during the past quarter, witha few previous owner-occupied buildings returning to the leasingmarket after they were vacated and sold.

"The Atlanta market has traditionally recovered from cyclicdownturns faster than other markets," says Lanie Rea, localresearch manager with Jones Lang LaSalle. "As the local andnational economies gain strength over the next few years, Atlanta'soffice market can be expected to tighten once again."

Asking rents remained stable during the second quarter at $21.66per sf, as landlords have attempted to hold the line on pricing,especially for core product in class A urban submarkets, Rea says.She notes that it's likely for some urban office tenants to seeklower costs and concessions in suburban submarkets, though somesuch as Midtown and Buckhead have higher rents.