After starting work on its T3 West Midtown project last week, Hines is moving quickly on its next Atlantic Station development.
In an appearance before the Fulton County Development Authority, Hines executives said they could launch “Atlantic Yards” this fall. The 515,000-square-foot project would include two buildings, one planned as five-stories, the other as 10.
The project would rise on an empty parking lot across from Atlantic Station’s existing glass office towers. The new project would feature masonry, concrete and steel, plus the look and ambiance of historic buildings, Tori Kerr, a managing director and development partner with Hines, told the Fulton Development Authority. The office building would also include 900 parking spaces.
Hines was asking the Authority for tax abatements to offset increasing construction costs that all developers are reporting.
Some new office towers are seeing development costs exceed $400 per foot. However, Atlantic Yards will have another unique layer of development costs, Kerr said.
Atlantic Station was developed on a former former steel mill at 17th Street and the Connector. It means Hines has environmental work to perform on the site’s residual slag, a by-product of making steel, that remains buried deep in the sub-surface.
That remediation has to be done before vertical construction on Atlantic Yards can progress.
Fulton County may need to consider up to $9 million in tax abatements to support the $205 million Atlantic Yards development. Hines will need to return to the Authority before the incentives can be approved.
The tax breaks would be carried out over 10 years. The development authority expects the project’s eventual tax revenues could still reach up to $26 million during that period, even with the abatements in place.
Drapac looks downtown Australian real estate investment firm Drapac Capital Partners is eying the purchase of 50 Ivan Allen Jr. Blvd, a site once planned as the centerpiece of downtown’s Allen Plaza mixed-use project. Drapac Capital has the site under contract from Atlanta real estate company Regent Partners.
In 2012, Regent bought the site out of foreclosure from BB&T for $4.5 million. Regent has considered it a prime downtown property, but it’s also expanding development into cities such as Savannah. Last year, it joined Mariner Group on developing a $500 million mixed-use project on the Savannah River. Another company, ELV Associates, is also part of the joint venture.
For Drapac Capital, 50 Ivan Allen Jr. Blvd. offers 1.4 million square feet for commercial development.“The area requires patience, but the city is rapidly urbanizing,” said Chief Operating Officer Sebastian Drapac. “It’s being fueled by potent drivers, most importantly population growth.”
The city has added more than 50,000 people since 2010, according to ARC estimates.
Allen Plaza is just a block from the Civic Center Station, a draw for companies wanting transit, and two blocks from Centennial Olympic Park. The site brings Drapac’s urban land holdings in Atlanta to just shy of 6 acres.
Pandora chooses ATL over Salt Lake City for $6M, 250-job office
Online music streaming giant Pandora Media Inc. chose Atlanta over Salt Lake City, Utah, for a new operations hub that should bring at least 250 primarily software development and engineering jobs to Midtown.
The company will invest $6 million in the Atlanta office and the eventual number of jobs could exceed the 250 announced earlier this year by Gov. Nathan Deal.
“It could far surpass that,” Seth Martindale, with CBRE Inc. consulting, said in an appearance before the Fulton County Development Authority.
Pandora is seeking from 50,000 to 100,000 square feet of office space most likely on the “Westside” of Atlanta an area known for some of the city’s finest restaurants and other amenities, he told the Authority.
It wasn’t clear if Martindale was referring to Atlantic Station, a mixed-use town center development that bridges the gap between Midtown and West Midtown along 17th Street.
If so, it would make sense. Pandora already has an office at Atlantic Station’s 271 Seventeenth Street, where it’s been bolstering regional advertising and sales operations.
“Next door,” Atlanta financial technology company Worldpay is listing almost 87,000 square feet on the seventh through 10th floors for sublease. It’s been seen as a favorite to land Pandora, but not yet a given.
Two of West Midtown’s newest Atlanta office buildings are reporting strong pre-leasing activity, but neither the Star Metals or The Interlock project have broken ground.
Selig Enterprises Inc. is planning a massive mixed-use project in the “Upper Westside” along Chattahoochee Avenue. Known as “The Works at Chattahoochee,” the project will represent a billion-dollar investment over the next decade and could mark the largest development of its kind for the area since Atlantic Station.
Al Nash, CEO of the Fulton County Development Authority, suggested at the May 22 meeting that Pandora was ready to start moving.
Atlanta Business Chronicle reported in January that Pandora unveiled a restructuring plan would shift operations from its West Coast headquarters to Atlanta. The strategy, which could save about $45 million, creates a “significant opportunity to add instrumental talent in a region with lower costs,” the company said at the time.
The OFS-transit connection
Gwinnett County has reached an agreement with Norcross fiber optic maker OFS Brightwave to buy more than 100 acres of its plant at Interstate 85 and Jimmy Carter Boulevard for $34 million — calling it a major milestone for economic development.
The purchase of the 104-acre site will be carried out by the county’s Urban Redevelopment Agency.
The sales agreement was presented at a May 22 public hearing. Gwinnett Commissioners approved a resolution in support of the purchase
The proposal comes as Gwinnett officials consider going to voters in November with a transit plan.
Gwinnett’s preliminary concepts for transit have included extension of heavy rail from MARTA’s Doraville Station north to Jimmy Carter Boulevard, where buses could feed into a multimodal facility.
The OFS redevelopment has long been seen as a chance for Gwinnett to create a landmark redevelopment like others along the northern edge of Atlanta.
In recent years, it has been pitched as a $1 billion media campus with 25-story towers. Before that, it was eyed as a $1 billion gambling resort. Years ago, Western Electric owned and operated a large plant on the site.
More than a decade ago, telecom giant Lucent Technologies housed almost 3,000 employees at the plant, but it laid off 15,000 to 20,000 employees globally when the telecom bubble burst. It eventually sold its optical fiber solutions unit to Furukawa Electric Co. Ltd., which renamed the company OFS and headquartered it in Norcross.
OFS will retain 66 acres of land at the plant, where it can continue manufacturing fiber optic cable, according to the agreement with Gwinnett County. OFS can also continue managing movie production on the site, which contains the “Atlanta Media Campus.” It has hosted several Marvel productions and served as stages for movies such as “Fast + Furious,” “Hunger Games” and “Divergent” franchises.
REAL TALK: A COLLECTION OF ATL REAL ESTATE BRIEFS
Downtown landmark 100 Peachtree is getting a major redesign that includes replacing the tower’s familiar “Equitable” sign with a new 174-foot digital logo for Georgia’s Own Credit The 33-story tower has been known as “The Equitable Building” since the late 1960s, when it was developed by AXA Equitable Life Insurance Company as its Southeast headquarters. Last year, Georgia’s Own Credit Union said it was relocating to the building, where it’s leasing more than 100,000 square feet. The new digital sign will display the Atlanta-based company’s logo and post messages promoting Atlanta events. It will be unveiled before next year’s Super Bowl. Digital signage and media will play a key role in defining Atlanta’s culture and brand, said A.J. Robinson, president of Central Atlanta Progress. The tower’s landlord Zeller Realty Group also brought on the architect Gensler to redesign the building’s amenities. Since buying 100 Peachtree last May, Zeller Realty has taken the building to at least 95 percent leased. That includes tenants such as Boston Consulting Group, which recently said it was expanding to a third floor. It will have 60,000 square feet. Zeller Realty reflects growing confidence in downtown’s office market. For example, direct office vacancy is the lowest it’s been since 2011, and rental rates for downtown’s top office space jumped nearly 13 percent during the past two years, according to Jones Lang LaSalle Inc., which handles leasing and management for 100 Peachtree. A century-old building in Atlanta on Ponce de Leon Avenue may get a new lease on life. The property owners of 881 Ponce de Leon had applied to the City of Atlanta for a demolition permit for the building at the corner of Ponce and Barnett streets so a JP Morgan-Chase bank branch could be built on that site. But the city moved to have the structure, built between 1913 and 1918 as an apartment building, be protected with a historic designation. The Atlanta Urban Design Commission was set to vote on that designation May 23. Instead of fighting the designation, the property owners have “embraced” the designation, according to Matthew Levin, a senior advisor for SVN who is representing the family that has owned the building since 1995. “The nomination caught them off guard,” Levin said. “They had no idea there was historic significance to the building.”Ironwood Insurance Services has signed a 26,000-square-foot lease to relocate its headquarters to One Riverside, an office building along the Chattahoochee River between Cobb Galleria and Vinings. Glenn Kolker and Preston Menning of Cushman & Wakefield represented the landlord, MAA, in the transaction. The real estate investment trust continues to make upgrades to the property, with the restaurant Adalina slated to open in the fall.
Maria Saporta contributed to this column.