In the not-so-distant past, you could look out the window of any mid or high rise in Atlanta and have a view unimpeded by construction cranes. Thankfully, those days (at least for now) are over. From our offices in Atlantic Station, we have a panoramic view of Atlanta and are watching with interest the growing number of cranes around the area that signal real estate development. Many of our real estate developer clients are driving new projects and we’re excited about the continued prospects for real estate investment.
“So many areas of Atlanta are experiencing remarkable development ,” said Joe Foltz, a partner at Womble Carlyle Sandridge & Rice LLP. “Avenues of Buckhead is taking shape with tenants taking occupancy. Ponce City Market, Krog Street Market in the Old Fourth Ward and Inman Park have become highly desirable destinations for retail and dining and chic locations for residential. However, the renaissance of intown neighborhoods strikes me as the most remarkable, much of it stimulated by the Beltline.”
Following is a perspective of this growth we are witnessing from our view of the city.
From our view of downtown we see a number of cranes that appear to be sticking out of the Georgia Dome. Of course, they are actually behind it – though only by 84 feet. They signal construction on the new Atlanta Stadium. Like much development here, the Atlanta Stadium is designed with sustainability in mind and will seek LEED Certification when complete.
Downtown Atlanta is coming off a very robust year of growth. 2014 saw two national museums, new streetcar track construction and streetcar launch and proposed apartment towers. And although no cranes are involved, we would remiss if we didn’t note that downtown will be among the Atlanta areas boosting the growth of start-up hubs. Downtown’s historic Flatiron building is undergoing a major transformation to an entrepreneurship hub by Microsoft. Within the hub, a Women’s Entrepreneurship Initiative will be developed to serve as a “Launchpad for rising women entrepreneurs in Atlanta.” This key renovation will be a boon to numerous small businesses. Courtland, Edgewood and Auburn Avenues all have proposed developments in early stages. There is also the ongoing discussion about what the next iteration for Underground Atlanta will be. WRS, Inc. out of South Carolina, entered into an agreement with the City to purchase the property in December of 2014. Since then, the organization has held meetings to discuss ideas for development. Closing is projected for mid-2015 with development to begin in 2016. No word on the status of this project as of this article’s publication.
Transitioning from downtown, north to Midtown, Midtown Alliance has a planned streetscape project on the section of Peachtree Street from Ponce de Leon to Pine Street – an “important link between Midtown and Downtown Atlanta.”
We have an equally clear view of the booming growth of Midtown. With 15 projects under construction and as many under development, Midtown is enjoying an incredible pace of growth that includes a focus on green space, improving the Midtown experience as well as drawing new business to the area including technology companies. In the Midtown Alliance Real Estate Report this February, CEO Kevin Green discussed the “remarkable transformation” that this important Atlanta neighborhood is experiencing.
Lance Patterson, of Patterson Real Estate Advisory Group, also recently noted, “I feel there are great development and value enhancement opportunities today in Midtown – both the east and west sides. Midtown offers what today’s renters (commercial and residential) are looking for including accessibility, ‘Live/Work/Play’ environments and cool, character-laden, unique real estate.”
Being a corporate resident of Midtown from our Atlantic Station office on 17th Street, we’re very excited to see Midtown’s growth from high above the city. The Midtown Alliance Development Tour highlights several projects that combine residential and retail space, as well as cultural construction – the Center for Puppetry Arts Expansion – and the new Emory Proton Treatment Center. Moving west but still in Midtown proper, the new Portman development planned for Technology Square, Georgia Tech’s signature development, is shaping up to be a $300 million mixed-use project that will tower over current development and will incorporate the façade of the historic Crum & Forster Building. Within our Atlantic Station neighborhood, a technology-focused office building has been announced and construction is expected to start soon. Developed by Hines, the building will have an old-fashioned exterior, but the interior will be long on modern day technology to accommodate and encourage “progressive” tenants seeking “creative” space. Like other Atlantic Station properties, sustainability will be a focus.
The unofficial newbie to growth is what many call West Midtown. Long considered the more industrial side of the city, this area of town that begins at the far west of Midtown’s official boundary includes the burgeoning Howell Mill corridor. Though cranes are not a fixture in this area, don’t be fooled – it’s a booming neighborhood populated (for now) by low-rise and single-story buildings and razed industrial property that are being put to profitable use.
For instance, Strongbox West – a co-working space for entrepreneurs – renovated and took over 50,000 SF of a single-tenant building located on the corner of the property that also houses the MeadWestvaco plant on Marietta Boulevard. Midway between Strongbox West and our office sit two key pieces of property under development. One is a three-acre property that is home to a rising development on Howell Mill. With 15,000 square feet of retail space and over 300 apartment units planned, the area around Brady Avenue and Howell Mill Road is bustling with construction activity. Literally across the street, the Westside Ironworks adaptive re-use project is well underway with almost all retail space leased. Having salvaged the long-time home of Ironworks International, the property also includes previous land occupied by a construction machinery rental business. The Howell Mill Road Development Blueprint, addressing future growth and development of the corridor north of the Atlanta Water Works, is in its early stages but promises to address potential mixed-use development and better pedestrian accessibility to that area.
North of the city, Buckhead development is also evident. From his office, Mark Abrams, leader of our real estate group, will be able to keep an eye on the Fuqua Development located on 13.5 acres in south Buckhead near Piedmont Road and Lindbergh Drive. Apartments, townhomes and single-family homes will join an 82,000 SF Kroger when it’s all said and done. And just when you thought the long-anticipated Buckhead Atlanta project might be complete (after all, we finally have a Shake Shack), the developer – OliverMcMillan – has announced that the time might be right for the group to develop the former HiFi Buys property just north of Buckhead Village. A spec building is a possibility – probably seven or eight stories. And with its 30-story tower (Three Alliance Center) already under construction in Buckhead at Georgia 400, Tishman Speyer has announced plans to start a spec office building in Buckhead Village on East Paces Ferry Road.
This not all-inclusive list of Atlanta real estate development leaves us a little breathless. One word of caution from Foltz, however. “Multi-family housing development has continued apace across all submarkets. Should there be a downturn in job creation or the economy as a whole, this sector will experience the consequences of oversupply. In addition, more transit oriented development will be required or traffic gridlock will make these prize locations unattractive to visitors to the areas.
For the present, we are buoyed by the development the city is once again enjoying, and its contribution to the city’s ability to draw and keep quality businesses and residents.
Our next review will cover the development occurring in Cobb County, in large part thanks to the Atlanta Braves relocating there. If we have missed activity that you think should be discussed, drop us a note. We’ll add them to a future update.
Contact Smith & Howard’s Real Estate Accountants
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