Will new developer stick with Ben Carter’s plan?
Arizona has the Grand Canyon.
Georgia has the Streets of Buckhead.
But is the dust about to settle?
What Now Atlanta reported in December that Streets of Buckhead (SOB) was recently taken over by OliverMcMillan, a California development firm.
The deal is scheduled to close the end of April and the California firm is said to invest approximately $300 million to finish the project.
SOB stalled in 2009 under Ben Carter Properties, but what of the initial project is still in tact and which retailers are still on board?
Some of the original retailers included Hermes, Oscar De La Renta, and Brioni to name a few. Hermes left Lenox Mall in anticipation for the project and has since reopened on Buckhead Avenue across from the Hole of Buckhead. One could assume their numbers are afar cry from projections, but they probably get discount beers from their neighbor, Fado Irish Pub.
Whether the rest of the planned retailers will commit, is unknown. Industry wide, national retailers have put expansion plans on hold and those leading retailers that are expanding in the U.S. are Dollar Stores and Goodwill; not Gucci or Ferragamo.
And what of the skyscrapers and high-rises included in the initial SOB plans (vertical development)?
Two residential towers and boutique offices were in the original SOB plan. But is there really a need for more condos and office towers in Buckhead? Consider this: seven million square feet of office space was added to the market in 2008. This, combined with the economic downturn, has created a historical high vacancy rate of 20 percent.
Metro Atlanta’s condo market is recovering, but most of the recent sales are driven by price. There were nearly 830 condo sales in 2010, but the majority were foreclosures or short sales. Oliver is taking a big gamble expecting the real estate market will recover in the short run and be able to absorb a six block complex of retail, residential, and office.
Plans for SOB also called for two high end luxury hotel brands.
Both brands were the first two elements to back out from the original plan and it doesn’t seem plausible for the newest plans to include hotel elements. General consensus on any significant vertical development to break ground in Buckhead is at least five years out from happening.
In order to maximize profit and growth, the new developers will need to first build the retail and establish the foundation of the project (street level). The developers will need to make the initial construction structurally sound to add vertical development five to ten years down the road. If the developers are smart, they’ll disguise empty construction pads with temporary green space and build them out as needed with time.
The dirt hole and exposed steel (rebar), passed by an estimated 45,000 cars daily, is a constant reminder of the sad state of the economy, and the tornado effect it had on real estate– a ghostly image of what was once the social nightlife area of Atlanta, the great times that were enjoyed there in the 80’s and 90’s and even early 2000’s.
The Kegs are kicked, and we are ready for the next chapter. Hopefully OliverMcmillian will carry out the original vision of Carter, and bless this city with a destination point and development that all Atlantan’s can be proud of.