Atlantic Station Thread II

[AubieTurtle]

I have coworkers who are convinced that the delays on buildings like the Atlantic are proof that the building intown was just a phase and everything is going to collapse and be abandoned in a few years. The builders aren't helping this perception any by announcing overly aggressive construction schedules. It's funny because when you look at construction at about anytime, there are always delays but people don't notice them. How many suburban housing tracts have come in on time? Most have plenty of delays but because those projects aren't high profile, it isn't noticed.

[MarketsWork]

Aubie, somebody else -- and it might have been you -- recently compared aggressive builders' announcements to dogs spraying trees to mark their territory and ward off others who might want to share it. I think that was an apt comparison.

[NativeAtlantan]

Do your coworkers live in the suburbs, Aubie? If so, that might explain it. I remember when the stockmarket was going crazy in the '98-'00 time period and I wasn't in it and all I could do was pray for a bust because I was so jealous of everyone that was taking advantage.

I think it's too late for the intown movement to collapse. There's too much momentum and I think enough people have already bought in to the idea. Yes, I believe there will be surges, but I think the days of reverse in-migration are over, or even stagnation - at least for the next 15-20 years.

[Fiorenza]

Judging from building permits and other indicators, highrise condo net absorption in Atlanta (Bhead-MT-DT) will certainly continue to attract buyers in the hundreds, not thousands...but still a decent enough volume to result in several nice buildings being brought to market every year. In 2008, supply coming online will temporarily outpace demand. Midrise and smaller condos will be developed in even greater numbers with supply and demand being closer to equilibrium. But, the real story in Atlanta is continuing single family infill and gentrification, in the thousands of units per year, pushing this sort of development further south in the city.

[Fiorenza]

I have some anecdotal information that the level of graft and corruption in the Atlanta building permits, is pretty rampant. Anybody else here have thoughts about it? Compared to other big cities?

[AubieTurtle]

Originally Posted by Fiorenza

I have some anecdotal information that the level of graft and corruption in the Atlanta building permits, is pretty rampant. Anybody else here have thoughts about it? Compared to other big cities?

From speaking to people in the city, the building permitting system has been one of the hardest parts of the government to reform, both from a "good ol' boy" network and a process perspective. I suspect that the problem is partially because of the boom that the city can't just go in and clean house because neither the city nor developers can afford for the system to be disrupted. Even if the current system is slow and poorly run, it is better than the chaos that would result from a whole new department. When you think about it, development has always been the place with the most opportunities for corruption and Atlanta is coming out of decades of some pretty poor goverance. It's going to take time to get things cleaned up and get the process changed to be simpler and faster. Most everyone wants it to happen but it won't happen overnight. Getting upset and keeping the department under a microscope helps keep the pressure on them and towards more reform.

As far as 2008 goes, I expect supply and demand to often get out of kilter. Unlike suburban subdivisions that typically deliver units in phases (each of which are usually really just a continual delivery of one home after another instead of them all at once), towers tend to deliver units in a short period of time. The lower floors may be released before the upper floors but in general there isn't that long of a gap between the first and last units.

I agree that infill will continue to be a big part of the city's growth. And this doesn't just mean tear downs or squeezing units between lots. Anyone who spends a bit of time looking at existing neighborhoods from above will notice that most neighborhoods have lots of undeveloped fields and pockets. The houses along existing streets might be dense (by the standards of when the neighborhood was developed), there are plenty of gaps where new streets could be added with more houses, not to mention multifamily housing. So far it seems like east Atlanta has been capturing lots of this but I'm amazed at the possibilities in the west and south.

It's also interesting to look at what areas are going to gentrify next. The Bluffs, English Avenue, and Vine City are very rough areas with bad reputations but they're also near downtown and logically would feel pressure towards gentrification. When I was looking up a property over there about a month ago, I noticed that many of the houses were owned by investment companies so it looks like the buy up is already happening.

[JTLInATL]

Originally Posted by StreetCandy

big department stores are a trend thats been dieing out since at least 1992!

Not true. Department stores chains have undergone major industry consolidation over the past 15 years, but that appears to be stabilizing and revenues are growing. There was an article in the New York Times about it a couple of months ago (http://select.nytimes.com/gst/abstra...80994DE404482), which explained how department store earnings growth is now outpacing specialty apparel store growth, because they can respond to fashion trends much faster than stores like the Gap who do everything in-house. Astute buyers can keep department stores on the cutting edge, without being dependent on private label apparel.

[sabino86]

Originally Posted by micropundit

^It was all they could get.They tried Bloomies and even Jacobson's(a defunct Midwestern retailer). They may now replace Dillard's with a Lord & Taylor who are now looking to regain their footing under new ownership.

Good riddance (if it happens). The most visible Dillard's in Atlanta (with Downtown Connector signage) and it gets jack s**t in business. What a waste of space.

[curiousATL]

All will be happy to know I passed a banner sign today that said Starbucks coming soon next to the Floral shop in the street level space of Twelve.

So whoever mentioned those non-compete restrictions ... guess things changed.

[AubieTurtle]

It is possible that the retail space in Twelve is not subject to Atlantic Station's non-compete rules since the space is likely leased out by Novare rather than Atlantic Station. If that is the case, expect future buildings to have in their sales contract with the independent developer to include a clause that they will not rent retail space to companies that compete with existing retailers in Atlantic Station.

[Afanti]

Originally Posted by curiousATL

All will be happy to know I passed a banner sign today that said Starbucks coming soon next to the Floral shop in the street level space of Twelve.

So whoever mentioned those non-compete restrictions ... guess things changed.

I heard a lady who works for Starbucks told me that Starbucks will be inside Target. They can not be in any of the retail space outside. I do not know how true it is. But anyway, I do not care and do not want to pay $3 for a cup of coffee.

[Buck]

They were going to put a Starbucks in Twelve and then they didn't and said that there would only be one in the Target. I guess they changed their minds again. That's great... Twelve is so bare right now on the 17th side. Besides, Target Starbucks aren't exactly complete Starbucks usually... they don't sell/take Starbucks giftcards and usually don't have the same food/pastry collection.

[Atlriser]

I find it hard to believe that a noncompete clause exist at Atlantic Station. That sounds very contradictory to everything happening their and furthermore, how do you define who competes with who? Retail is so competetive overall that restaurants compete with starbucks compete with ice cream shops compete with Publix so this idea seems utterly ridiculous and just a rumor floating about IMO.

[ThrashATL]

Originally Posted by Atlriser

I find it hard to believe that a noncompete clause exist at Atlantic Station. That sounds very contradictory to everything happening their and furthermore, how do you define who competes with who? Retail is so competetive overall that restaurants compete with starbucks compete with ice cream shops compete with Publix so this idea seems utterly ridiculous and just a rumor floating about IMO.

Bite your tongue! There are NEVER any UNSUBSTANTIATED rumors on SP!

[smArTaLlone]

Originally Posted by Atlriser

I find it hard to believe that a noncompete clause exist at Atlantic Station. That sounds very contradictory to everything happening their and furthermore, how do you define who competes with who? Retail is so competetive overall that restaurants compete with starbucks compete with ice cream shops compete with Publix so this idea seems utterly ridiculous and just a rumor floating about IMO.

Actually it was specifically mentioned in news articles concerning the Target, which will not have groceries because of an agreement with Publix.

[AubieTurtle]

Originally Posted by Atlriser

I find it hard to believe that a noncompete clause exist at Atlantic Station. That sounds very contradictory to everything happening their and furthermore, how do you define who competes with who? Retail is so competetive overall that restaurants compete with starbucks compete with ice cream shops compete with Publix so this idea seems utterly ridiculous and just a rumor floating about IMO.

While it might not be true, it is far from ridiculous. This is quite a common agreement in malls, where a specialty retailer will not agree to lease space unless the mall will guarantee that the mall will not rent space to their competitors. In theory this should not be part of capitalism since it stifles competition but it is pretty much part of the game these days. Just look at how many empty Wal-Marts and Home Depots there are around the country when Target and Lowes would be more than happy to move into the locations if the former tenant would sell it to them. Often even after the property is sold, there is a restriction on the deed that does not allow the land to be used for a competitor of its former owner. Business is so much easier when you can keep your competition out of the market and it is very much worth the minor loss of some real estate income in exchange for exclusive access to the local market.

In Atlantic Station's case, it very well may be that Publix would not agree to open a sorely needed grocery store unless they were guaranteed exclusive control of the grocery market in Atlantic Station.

[curiousATL]

Originally Posted by Afanti

I heard a lady who works for Starbucks told me that Starbucks will be inside Target. They can not be in any of the retail space outside. I do not know how true it is. But anyway, I do not care and do not want to pay $3 for a cup of coffee.

Um ... excuse me but I'm not lying. Why would I make that up? I'm assuming since their is a sign up (yes, there actually is ... go look for yourself) that they can be in the retail space.

[jobe]

Originally Posted by curiousATL

Um ... excuse me but I'm not lying. Why would I make that up? I'm assuming since their is a sign up (yes, there actually is ... go look for yourself) that they can be in the retail space.

There is absolutely a Starbucks going in at TWELVE. It opens in January.

[Buck]

Maybe the non-compete clause, if it exists past just for Publix, is only for big-box?

[Atlriser]

Instead of continuing to debate the merits of such agreements and so forth, why not have who ever started this RUMOR step to the plate and produce some actual facts to back it up. Otherwise what’s the point? The continuation of debating the merits only adds fire to the existence of such.