Crocker Partners and MidCity plan Sandy Springs project along Georgia 400

Developers in Atlanta’s central Perimeter are drawing up plans for more projects, as tenants look to expand while existing office space fills up.


The latest ambitions come from a joint venture between Atlanta’s MidCity Real Estate Partners and Florida-based Crocker Partners. The companies want to develop NorthPlace, which could include up to 370,000 square feet of office space.


The 3.7-acre site stands at Barfield Road and Georgia 400 in Sandy Springs and just southeast of the new Mercedes Benz USA headquarters. The site has been a target of development for years. Crocker bought it in 2007, just before the downturn. Today, Barfield Road is part of an active corridor connecting Hammond Drive, Mount Vernon Highway and Abernathy Road, an area home to blue chip companies such as UPS, Global Payments, and IBM (ISS).


Earlier this year, Mercedes Benz said it was relocating its headquarters from New Jersey to a site on Abernathy. Ashton Woods Homes also plans to convert the 76-acre site around the headquarters into a mix of townhomes, flats, apartments and retail. The development could feature more than 1,000 planned housing units.


Anticipating that residential growth, NorthPlace developers have plans for ground floor retail. The site’s density can also be adjusted based on the needs of tenants, and it could accommodate build-to-suit projects from 20,000 to 100,000 square feet. “What makes us different is that we can dial up the density or go smaller,” said Kirk Demetrops, president and founder of MidCity Real Estate Partners.


The joint venture has started marketing the property and needs significant pre-leasing before it would launch construction. Warner Summers – Architecture is designing the project.


Across the central Perimeter, plans for new projects show how much demand Atlanta’s largest single office district is seeing from prospective tenants — and how much the market’s class A space is tightening. Overall vacancy is the lowest in over eight years, with class A vacancy dropping to 11 percent, according to market data. Roughly 2 million square of tenants in the market have leases expiring over the next two years, Demetrops said.


Companies are also expanding.


Atlanta Business Chronicle is reporting today Enterprise software maker VMware Inc. (NYSE: VMW) plans to expand its Atlanta-based AirWatch business — a move that would create more than 300 jobs. Palo Alto, Calif.-based VMware is said to be scouting the central Perimeter and north Fulton for at least 50,000 square feet of space.



General Electric officials are also expected to tour buildings and sites across Atlanta as the company considers Georgia as a possibility to relocate its Connecticut headquarters. The Wall Street Journal recently reported a decision could come by the end of this year.


Big blocks of class A Perimeter office space are drying up, as new development has been limited by tighter lending and rising construction costs. The last speculative office building to break ground in the central Perimeter was almost 10 years ago, according to data from real estate services firm Cushman & Wakefield. One of the few class A blocks just became available after Newell Rubbermaid Inc. decided to move its corporate headquarters from one side of Georgia 400 to the other.
Developers see an opportunity, especially along Abernathy and 400.


Later this year, Hines plans to start a spec office project on 14 acres at Mount Vernon Highway, Abernathy Road and Georgia 400. Cousins Properties Inc., Ackerman & Co., and H.J. Russell & Co. also formed a joint venture to develop a mixed-use project on the same corridor.


All this comes as rents soar to the highest levels in the Central Perimeter’s history.
Rents in central Perimeter’s top office buildings have climbed to at least $30 a foot. And, despite ongoing challenges from rising construction costs, the gap between existing class A rents and the rents necessary to launch a new building has narrowed to as little as $6 a foot.


“The office market’s performance the past 12 months is unprecedented,” Demetrops said.


NorthPlace would extend MidCity Real Estate Partners’ presence in the central Perimeter. Earlier this year, it announced it secured Focus Brands for a 63,000-square-foot headquarters.
MidCity redeveloped Hammond 400, a site at Barfield Road, Hammond Drive and Georgia 400, with six build-to-suit buildings. The last phase of the project is under construction, with 90 percent sold or under contract.
Crocker Partners’ Atlanta portfolio also features such marquis Atlanta towers as Prominence in Buckhead, Regions Plaza in Midtown and Cumberland Center II in the Cumberland submarket.

This Article Originally Ran in the Atlanta Business Chronicle

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