Situation

This 138-acre, $2 billion, mixed-use community development of the former Atlantic Steel mill, a brownfield site, by Jacoby Development, Inc. and AIG, was originally conceived as an environmentally-friendly Master Design Project by Georgia Tech graduate student, and ATLANTIC STATION’s current Vice President of Design and Development, Brian Leary.

At completion, the project will consist of 1.5 million s.f. of retail space; 5,000 residential units; 6 million s.f. of Class A office space; a 20,000 car parking structure; and 1,000 hotel rooms.

Located west of I75/I85, this highly visible yet essentially unavailable site required the addition of the 17th Street Bridge to link ATLANTIC STATION® to Midtown on the east side of the freeway. Midtown, a high-density office and residential area, is the home of Atlanta’s arts district.

Initial plans to sell parcels in The Village (IKEA), The Commons (high-density residential), Home Park (bungalow, townhome and duplex residential) and The District (office, retail, entertainment, hotel and loft residential) to various development partners stalled when earlier partnerships were not productive.

Jacoby Development, Inc. committed to personally build out the community and solicited partners capable of translating the components of their vision for a “new urbanism” into reality. Jones Lang LaSalle was hired as retail advisor to assist with evolving their retail strategy and successfully integrating the retail component into the community from the ground up.

Initiatives

Drafted a white paper document illustrating the low volume of retail in the Midtown area which served as a basis for the retail market research conducted for this development.

Assisted the legal team in translating design concepts into models and in drafting documents, including ownership declarations for five owners associations.

Developed operational and common area programming.

Identified the anticipated property common area maintenance (CAM) expenses and developed sophisticated recovery methodologies; developed budgets and an assessment matrix for all building types, uses and owners.

Established an initial financial proforma model to evaluate projected returns for various leasing and development strategies.

Results

The CAM matrix delivers a five-year projection with budgets for five owners associations and nearly 15 different property categories.

The proforma model was used to develop the underwriting for the retail financing increasing the initial value by 16%.

Eventually assumed responsibility for retail property management and leasing, as well as administration of all owners associations.

The retail portion of ATLANTIC STATION® is scheduled to grand open in October, 2005 with Dillard’s, a sixteen-screen Regal Cinemas, Publix Urban Market, DSW, a growing collection of unique and upscale retailers, and a diverse assortment of restaurants. The first IKEA in the Southeast opened in June 2005 and anchors the southwest corner of the development.

By the end of 2005, 2,000 units of residential will be occupied, nearly 1.2 million s.f. of retail will be open for business, 100 hotel rooms will serve the public and 800,000 s.f. of office space will be open or under construction.