Vericor Renews at Brookside One for Five Years

The Munich-based subsidiary of MTU Aero Engines North America Inc. of Newington, CT renewed its five-year, 12,711-sf lease at an estimated aggregate rent of $659,000. Brookside One, 87% leased, is at 3625 Brookside Parkway in this suburb about 30 miles north of Downtown Atlanta.

As lease deals go, this was not a record-shattering event, but in a difficult North Fulton County office submarket where there is almost 3.4 million sf of empty space equating to a vacancy level of 27.8%, the transaction was considered noteworthy, according to area brokers. Vericor considered relocating to five other area buildings before deciding to remain at Brookside, Carter's Diamond tells GlobeSt.com.

"We presented Vericor with multiple relocation alternatives in and around the North Fulton area," Diamond says. "However, because Duke Realty's renewal economics were so attractive, Vericor decided a lease renewal would provide the most cost-effective solution." The average asking gross base rent in North Fulton is in the low $20-per-sf range, the broker says.

"We have been at Brookside One for five years and the property and location have really served our needs well," says Sebastian Groeger, Vericor's chief financial officer. "Carter ensured that we obtained the best rate and a significant rent reduction for the lease renewal." Adds Diamond, "The North Fulton market is still quite vacant but improving slowly."

Atlanta-based Colliers Cauble Co. puts the entire rentable North Fulton submarket's 83 class A office buildings at 12 million sf. North Fulton posted a negative absorption of 234,704 sf in the second quarter. The submarket's total class A, B and C office space is 20 million sf, with nearly 4.5 million sf empty at an overall vacancy mark of 26.3%.