- Cousins Properties invested nearly $1B in offices in late 2024, making it one of the most active institutional buyers in the sector.
- The company’s portfolio occupancy rate rose to 89.2%, up from 87.3% at the end of 2022, as top-tier office space remains in high demand.
- Cousins signed over 2 MSF in office leases in 2024, a sharp increase from 1.7 MSF the year prior.
- The REIT plans to continue strategic acquisitions through 2025 as more institutional investors reenter the office market.
After years of cautious investment in the office sector, Cousins Properties (CUZ) is making a bold bet on its recovery, as reported by CoStar.
The Atlanta-based real estate investment trust invested nearly $1B in offices during 2H24, marking what CEO Colin Connolly described as “one of the most productive” periods in the company’s history.
By The Numbers
Cousins’ acquisitions were focused on trophy office properties in high-growth Sun Belt markets.
In December alone, the firm closed a $522M deal for Austin’s iconic Sail Tower and a $328.5M acquisition of the Vantage South End office campus in Charlotte. Earlier in August, the company completed an $80M purchase of a prime office tower in midtown Atlanta.
Altogether, the REIT added nearly 2 MSF of premier office space to its portfolio, a clear sign that larger investors are reentering the office market after a period of uncertainty.
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Chasing Demand
Many institutional investors have remained on the sidelines in recent years, waiting for a balance between improving economic conditions and attractive pricing. However, as pricing stabilizes and more comparable sales emerge, larger players like Cousins are returning to the market.
Cousins’ investment strategy aligns with a broader trend favoring high-quality office properties. Since the pandemic, tenants seeking office space have increasingly focused on buildings with premium amenities and prime locations. This created a clear divide between top-tier office assets and lower-quality buildings, which continue to struggle with high vacancies.
According to CBRE data, vacancy rates for top-tier office buildings are 13%, compared to 19% for lower-quality spaces. Additionally, landlords with premium properties command asking rents more than 50% higher than the rest of the market, up from a 40% premium three years ago.
Portfolio Plans
Cousins’ focus on high-end, well-located office properties has helped drive strong leasing activity. The company reported more than 460 KSF of office leases in Q4, bringing its total for the year to over 2 MSF, up from 1.7 MSF in 2023.
The REIT’s tenant roster includes major corporate names like Amazon (AMZN), Alphabet (GOOGL), ExxonMobil (XOM), and Bank of America (BAC), reflecting its appeal to blue-chip tenants. As a result, its portfolio occupancy rate steadily climbed to 89.2%, compared to 87.3% at the end of 2022.
With a 21.1 MSF office portfolio spanning Atlanta, Dallas, Houston, Austin, Tampa, Charlotte, and Phoenix, Cousins is well-positioned to capitalize on the next phase of office recovery. The company plans to keep buying in 2025, as investor confidence in high-quality office assets grows.
Looking Ahead
Cousins Properties’ aggressive investment spree marks a turning point in the office market, signaling that institutional investors are beginning to reengage with the sector.
With demand for top-tier office space outpacing lower-quality assets, the REIT is doubling down on a strategy prioritizing well-located, amenity-rich office buildings.
As the office market stabilizes and more companies commit to long-term leases, expect to see more institutional buyers follow Cousins’ lead, further fueling the sector’s rebound in 2025.
