"Atlanta will see its first two-million-sf building," notes the report prepared by brokers W. Colin Cavil and Dennis Mitchell. In addition, more deals will be done by private buyers with tenancy-in-common arrangements dominating. More functional obsolete buildings will be demolished for the land value. Pension fund allocations will increase, along with "capital recycling." A total 40 million sf of properties will change hands, the report projects.

As support for their forecast, the brokers cite the sales track record of the past four years. In 2005, 189 properties totaling 29.8 million sf were sold for $1.3 billion or an average $44 per sf. In 2004, 181 properties totaling 23.9 million sf were sold for $958 million or an average $40 per sf. In 2003, 116 buildings totaling 15.5 million sf were traded for $545 million or an average $35 per sf. And in 2002, 112 properties totaling 15.2 million sf changed hands for $475 million or an average $31 per sf.

Private buyers accounted for 72% of the sales in 2005; REITs, 8%; and institutional buyers, 20%. In 2004, private buyers did 61% of the deals; REITs, 12%; and institutional, 27%. In 2003, private buyers bought 75% of the properties; REITs, 5%; institutional, 20%. REITs had their best year locally in 2002 when they made up 22% of the buyer profile. Private buyers still led the pack, doing 72% of the deals. Institutional trailed with 6%.