ATLANTA—Who has the power in the Atlanta officeleasing market—landlord or tenant? The answer to thatquestion may depend, in part, on whom you ask.

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GlobeSt.com caught up with Bill Weghorst,executive vice president of PM Realty Group, tosee what he thinks in part two of this exclusive interview. He alsopredicts when and where he expects to see a significant wave of newoffice development in Atlanta, and what business, economic and realestate trends should people be watching that will impact the futureof the Atlanta office leasing market. You can still read part one:The Most Notable Change in Atlanta's OfficeMarket.

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GlobeSt.com: Who has the power in the Atlanta officeleasing market—landlord or tenant? Why?

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Weghorst: The lack of upward pressure on rentalrates in some submarkets suggests that tenants continue to holdbargaining power, but the tide is changing as landlords are nowoffering fewer concessions and rental rates have been trendingupwards in the most desirable submarkets such as Central Perimeter,Buckhead & Midtown.

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Steady demand has depleted the supply of large contiguous spaceoptions, causing class A asking rents to climb in these submarkets.Most notably, the Central Perimeter submarket has seen class Arents rise by 7.1% to $24.09 per square foot within the past 12months.

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GlobeSt.com: Where and when do you expect to see asignificant wave of new office development? What must happen beforethis wave occurs?

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Weghorst: The first office building to come outof the ground will likely be Tishman Speyer's Three AllianceCenter, a proposed 500,000-square-foot class A building inBuckhead, with expected delivery in mid-2016. This premiersubmarket impressively delivered just over 3.2 million square feetof new inventory during the last building boom from 2007 to 2010,but is primed for new construction as the cumulative class Aoccupancy levels among this new inventory is nearing the 90% markand the newest of these buildings is now quoting over $35.00 persquare foot.

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Central Perimeter is the likely next location for new officedevelopment as large contiguous blocks of space have become scarcelargely due to State Farm, but the insurance giant's looming 2.2million-square-foot campus have kept developers more restrainedthan in previous cycles even with the submarket's class A directoccupancy rate at 88.5%. However, there are several large tenantsscouting the market who could kick off a development, such asIntercontinental Hotel Group, AIG or NCR to name a few.

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Among the developers that could move forward with a new officetower include Ackerman & Co at its Abernathy 400 site,Manulife's 18-acre mixed-use site next to Ashford Green officebuilding, which calls for a 250,000-square-foot office building andHines Interests' 100 Northpark, a site off Abernathy Rd that couldaccommodate 1.5 million square feet of office.

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GlobeSt.com: What business, economic and real estatetrends should people be watching that will impact the future of theAtlanta office leasing market?

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Weghorst: Atlanta is benefitting from itsstrengthening demographics. With the region's population growthrate once again among the fastest in the US, the expanding consumerand labor force will continue to attract retailers, manufacturersand companies in other sectors.

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A high concentration of college-educated workers will continueto attract high-tech companies in life sciences, research anddevelopment, IT, professional and business services, and high-techmanufacturing. In addition, the costs of living and doing businessin the Atlanta metro area are relatively low, and the pool oftalent is large and deep for occupations that do not requirecollege degrees. Moderate job growth and limited development areexpected to continue throughout 2014, which will lead to a tightermarket for quality space and further rent growth in the mostdesirable submarkets.

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