NEW GAMES IN TOWN
UP-AND-COMING NEIGHBORHOODS ARE HEATING UP THE RETAIL REAL ESTATE MARKET.
Byline: Rebecca Kleinman
Move over, Buckhead. There’s some new hot spots in the territory that are ripe for retail real estate, and savvy specialty merchants are smacking their lips with anticipation.
These up-and-coming neighborhoods — Westside, Atlantic Steel Mill, the intersection at Medlock Bridge and Abbotts Bridge roads, and the Peachtree Street corridor between Fifth and 10th Streets in midtown — offer trendy restaurants, fresh upscale housing stock and the promise of affluent residents that are eager to spend.
Just a year ago, retailers looking for action were primarily limited to the Buckhead, Virginia-Highland and Little Five Points neighborhoods, at least when it came to in-town shopping areas with critical mass. And few alternatives were available outside the Perimeter, other than at malls.
Now, factors such as population growth, traffic issues and the trend of new urbanism are changing the real estate dynamics of the metropolitan Atlanta region. To meet demands, at least a half-dozen new developments have opened or are slated to open within the next two years, and none are in or near the traditional commercial centers.
Although retail real estate developers and brokers agree that Buckhead remains the number-one destination for its proximity to Lenox Square and Phipps Plaza and for its concentration of wealth, they report these newer areas will benefit niche retailers, whose stores wouldn’t necessarily fit the more established neighborhoods. The attractive customer profile in the latest crop of development is the clincher.
A good example of a shopping destination geared toward niche retailers is Westside, an upscale development at the corners of Howell Mill and Huff Roads that opened in February 2000. Described as an “urban shopping district” by Michael Phillips, president of Tucker Mott, a local development company, its industrial, yet clean and airy look differs greatly from the typical Atlanta strip malls.
Once home to a meatpacking plant and tire and liquor stores, Westside currently consists of five buildings broken down into approximately 30 units ranging from 500 to 10,000 square feet. Some units feature dual doors opening onto a courtyard, as well as a wraparound balcony. To Phillips, it was important to bring retail outdoors by integrating the environment.
Many cutting-edge merchants jumped at the opportunity to open there, despite its newness or location west of the interstate. The early movers included the restaurant Bacchanalia and its gourmet food halls called Star Provisions, Mondo magazine shop and cafe, Belvedere home furnishings, and Macon & Co. art gallery.
Set to open by summer’s end are G. Gilbert, a designer and better sportswear boutique for women ages 35 to 60; Scout, a lifestyle store modeled after APC in New York, and Bungalow, a high-end home furnishings and accessories store.
All three retailers report being drawn in by the same conditions: fresh, special, exclusive, different, pedestrian-friendly and not over-crowded.
“There weren’t any upscale or up-and-coming areas. The real estate just wasn’t there, until this came about,” said Courtney Tilinsky, co-owner of Bungalow, who looked for two years before finding her space.
MILLING ABOUT IN MIDTOWN
While Westside caters to local and regional retailers, other new developments add national tenants into the mix. Receiving the greatest attention is midtown’s Atlantic Steel Mill, a $2 billion restoration and building project proposed to open in 2002. Bordered by Interstate 75/85, Northside Drive, 16th Street and the railroad, its expansive site will include one million square feet of retail space, 4,800,000 square feet of office space, 400,000 square feet of entertainment space, 2,400 residential units and 800 hotel rooms. Among the Mill’s highlights, Brian Leary, an associate with Jakoby Atlantic Redevelopment, lists its open-air block and “shoppertainment” concepts; proximity to three MARTA stations; a freeway overpass connecting eastern midtown; underground and deck, as opposed to surface, parking, and an astonishing 400,000 cars a day that pass by on the Brookwood interchange.
“Midtown’s so hot because it’s strong residentially and it’s not downtown,” said Leary. His project is part of Blueprint Midtown, an architectural and cultural plan to transform the area into a pedestrian-friendly, 24-hour environment where people can work, live and play in one.
Also involved in the plan is the revitalization of Peachtree Street between Ponce de Leon Avenue and 10th Street, which developers report will transform the corridor into the Michigan or Madison Avenue of the South. “This type of pedestrian-friendly retail, with storefronts, has never occurred here on this scale,” said John Dewberry, president of Dewberry Capital Corp., a full-service commercial real estate development firm.
In 2002, he plans to open Midtown Square, a mixed-use high-rise on the northeast corner of Peachtree and 10th Streets, the spot that he has been told is “ground zero for Atlanta.” Of its two million square feet, approximately 175,000 will go toward retail. Dewberry predicts heavy occupancy by national tenants, while some regional and local retailers will add flavor. A hotel and underground parking also are part of the package.
To the south, development company Loudermilk and Rohrig holds nine consecutive corners on both sides of Peachtree Street between 10th and Fifth Streets. Their vision calls for a variety of residential and commercial spaces, ranging from a boutique hotel much like The Delano in Miami, to a high-end restaurant by the city’s most notable chef, Guenter Seeger, to a 17-story apartment building.
Though he described midtown as “the number-two stop, after Buckhead,” George Rohrig was quick to note that Buckhead lacks the same level of concentration and need for high-end retail and restaurants.
“There’s a lot of disposable income in midtown, especially with all of the high-end condominiums going in like The Biltmore and The Dakota,” he said.
Mira Bergen, president of A Store Is Born, a local commercial real estate brokerage and consulting firm, agreed that midtown is underretailed for the caliber of its residents. “It’s an affluent area with all of these people ready to spend money, and it’s full of office space,” she said.
Brokers predict midtown’s popularity will only rise, especially as more Atlantans grow tired of long commutes. They also attribute the neighborhood’s pending success to a less-competitive and more-sophisticated environment, suitable for cutting-edge retailers.
The new urbanism trend for single people and empty-nesters to move back into town doesn’t mean that retail areas outside Perimeter aren’t booming just as well.
One of the hottest locations, the intersection of Medlock Bridge and Abbotts Bridge Roads in Duluth, give residents a much-needed alternative to the nearby malls.
Currently, the intersection is anchored by Abbotts Bridge Station, a mixed-use retail center that opened in 1997. But coming in 2001 is The Avenue-North Fulton, one of Cousins Properties’ three outdoor mall developments in the Atlanta area, which also includes The Avenues East Cobb and Peachtree City.
According to Lisa Simmons, director of corporate communications for Cousins, this area will continue to grow despite the move toward in-town living. “Families with school-age children want the benefits of upscale neighborhoods. The two demographics can coexist,” she said.
Her proof comes from a report by the U.S. Census Bureau, which named Forsyth County the second-fastest-growing U.S. county for 1999.
Banana Republic, Gap, Blue Marlin and Old Navy have already leased space in the 210,000-square-foot complex, totaling some 30 to 40 units.
Abbotts Bridge Station offers the same combination of national, regional and local tenants, including Bath & Body Works; Suvan Day Spa; My Paris Apartment, a home furnishings specialty store; The Honeycomb, a children’s specialty store, and e.k. taylor, a women’s specialty store. Only one of its 17 units is available for lease this summer.
It didn’t take much for Linda Schulte, owner of e.k. taylor, to realize Duluth needed a good boutique. “I opened this store for women like myself, who hate the commute to Buckhead or Sandy Springs, but who love fashion,” she said.
Her strategy in choosing the Duluth market as the right spot for her operation is based on a commitment to pick one area and customer profile to focus on. Schulte said she doesn’t consider midtown’s growth a threat to the Duluth retail corridor, either, precisely because that area’s ambience and customer profile is not the same as Duluth’s.
Now, with even more burgeoning neighborhood developments on the way, including Brookwood Place on the edge of Buckhead and midtown, and retail spaces surrounding Centennial Olympic Park, such an attitude may pay off for other specialty retailers, as well.