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AT&T Will Leave Namesake Midtown Atlanta Tower

"These Developments are Not Unique to Atlanta. Enterprise-wide, We’re Constantly Evaluating Our Real Estate Portfolio to Identify Opportunities to Make Better Use of Underutilized Office Space," -- AT&T
January 30, 2018
In a blow to two Atlanta office submarkets, AT&T will vacate all the space it occupies at its namesake AT&T Tower in Midtown and two locations in Buckhead. The telecom services giant occupies 1.2 million square feet in the 49-story Midtown office tower alone.

All told, the moves could dump as much as 2.5 million square feet of space on the office market by early 2020. The main motive: cost savings. "These moves will help save costs and bring our teams into central locations," an AT&T executive said in a memo to managers.

Developers were quick to point out that AT&T’s decision to pull out of the Midtown tower was not unexpected.

"The market has known for years that AT&T is vacating the majority of the building, so the effective impact of them leaving all of it is marginal to the market," Selig Enterprises Executive Vice President Chris Ahrenkiel tells CoStar News. He added that the 37-year-old office tower will not present competition to any new or planned Class A towers. (Selig is preparing a prime Midtown site for a major new development that will include 650,000 square feet of Class A office space.)

Specifically, AT&T said it plans to leave AT&T Tower at 675 W. Peachtree St. in Midtown, 575 Morosgo - also known as Main Street - at Lindbergh City Center, and 1055 Lenox Park Blvd. in the Buckhead submarket. One of the Lindbergh towers is home to AT&T's Cricket Wireless service.

AT&T announced the changes Tuesday via emails to managers and employees. Lance Skelly, a director of corporate communications at AT&T, confirmed the moves in a statement late Tuesday. He said the company believes the consolidation of offices will "have minimal effect on our employees and operations located here."

Skelly also pointed out that many AT&T employees will simply move from one building to another in Lenox Park and others in Midtown will relocate only a short distance away.

"The developments are not unique to Atlanta. Enterprise-wide, we’re constantly evaluating our real estate portfolio to identify opportunities to make better use of underutilized office space," AT&T said in the statement. "Moves like this reduce our company’s operating expenses while creating more collaborative work environments for our employees."

In an email with the subject line, "Moves ahead for Atlanta office space," an AT&T mobility and entertainment executive said, "Ahead of the formal notification, I want to provide some context for you. AT&T and Cricket will keep a strong presence in Atlanta," the executive, Rasesh Patel, said in the message.

Patel said the firm plans to consolidate employees in other Atlanta-area buildings, including Midtown 1 and 2 office towers at 754 and 725 W. Peachtree St., and within the firm's Lenox Park campus at 1025 and 1057 Lenox Park Blvd. and 2180 Lake Blvd.

In addition to the 1.2 million square feet AT&T occupies in its namesake tower at 675 W. Peachtree, the firm also has 437,500 square feet in the attached eight-story support center. At Lindbergh City Center, AT&T leases 477,500 square feet in both Tower I and Tower II for a total of 955,000 square feet. 1055 Lenox Park is a 103,229-square-foot office building.

This is a developing story. Please return for updates.

UPDATE 1: Story updated to include total amount of space AT&T occupies in the AT&T Tower and to identify buildings where it plans to consolidate Atlanta-area employees.

Tony Wilbert, Atlanta Market Reporter  CoStar Group   

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