DEL.ICIO.USSovereign a regal addition to Atlanta skyline
The Atlanta Journal-Constitution
Wednesday, November 05, 2008
The developers of 3344 Peachtree, the tallest new building in Atlanta in 16 years, could not have picked a more inhospitable year to open.
Project financing is virtually non-existent. Banks are failing. Bankruptcy filings are at record levels. And condo sales are as infrequent as the rain.
Phil Skinner / pskinner@ajc.com/
The Sovereign building towers over other Buckhead buildings. This year’s economy is shaping up to be one of the worst in the country’s history. Yet, a local development company has managed to open the tallest building in Atlanta in almost 20 years.
Yet, there it stands, 50 stories of luxury that seems to defy the times. The curved glass building with the blue hue includes 82 condominiums at Sovereign that begin at $1 million and pricey artwork by Todd Murphy and Michael Stipe, the R.E.M. front man.
“When the project was planned and the commitments were made, no one was anticipating this kind of year,” said Julian Diaz, chairman of the real estate department at Georgia State University.
A development as big as 3344 Peachtree is a bet on where Buckhead is trending no matter what the current conditions, Diaz said.
“These tend to be very longterm decisions with very longterm implications,” he said.
The $250 million 3344 Peachtree represents the culmination of a 15-year effort to transform Tower Place, one of Atlanta’s earliest mixed-use developments, located near Lenox Square, into an ultra-urban destination.
“We’ve been doing good ‘new urbanism’ planning since day one, before that was a catch phrase,” said David Allman, founder and chairman of 20-year-old Regent Partners, the developer.
Regent Partners owns roughly 40 percent of the project and San Francisco-based Farallon Capital Management 60 percent, Allman said. 3344 Peachtree is the biggest project Regent has ever taken on.
Planning of the 850,000-square-foot mixed-use project began in earnest about five years ago when the economy was on an upward trajectory.
“It’s an extraordinary piece of dirt, as they say in real estate,” Allman remarked about the 3-acre footprint.
Still, the dismal economy has affected 3344 Peachtree just like it has all real estate.
While more than 70 percent of the 500,000 square feet of office space is leased, “if not for the meltdown in the financial community, it would be full by now,” Allman said. About a third of the condos have sold or are under contract, according to David Tennery, principal of Regent Partners’ office properties group.
In a way, it’s fitting that 3344 Peachtree opened during a time of financial distress because that’s part of its history.
In 1993, Regent Partners bought the 20-acre Tower Place for $36 million from Chemical Bank, which had foreclosed on the property.
Developed by Charles Ackerman in the 1970s, Tower Place had a suburban feel at the time.
“How do we urbanize this project?” Allman recalled thinking when the deal was struck.
The answer was multifaceted: Scale back the Tower Place roads, add sidewalks and lighting, turn surface parking into buildings, update and expand the retail, and acquire additional land to provide access to Ga. 400.
Allman founded Regent Partners in 1988, then sold it to Philipp Holzmann AG of Frankfurt. In 2003, Allman and Farallon bought back the company from a former affiliate of Philipp Holzmann that was bleeding money.
A small to midsize company with 30 employees, Regent Partners “understands design. They understand construction. They understand the land business,” said Rocky Fried, managing member at Farallon.
Allman is the longtime chairman of the Buckhead Community Improvement District, which uses tax revenues to make traffic improvements and foster pedestrian activity.
Sally Silver of NPU-B, the neighborhood group that reviewed 3344 Peachtree before construction began, said that despite its size, the building is “welcoming to people walking by. It definitely does not promote the canyon effect that a lot of highrises do.”
Smallwood, Reynolds, Stewart, Stewart & Associates spent more than a year on the design. The winding path of Peachtree Road, the varying floor sizes for the offices and condos, and Regents’ desire for a contemporary look in keeping with the neighborhood all played a part in the way the building turned out.
“We felt strongly that the design of the building should be very fluid and organic in response to its distinctive massing and site context,” architect Gil Garrison said. “The building appears as a series of supple folds and bends which carry one’s eye upward in a counterclockwise direction.”
The condos — one of which costs $9.5 million — are essential to making that commercial area of Buckhead a better place to live, Allman said.
“If there’s an ingredient that really changes the dynamic of mixed-use projects, it’s residential,” he said. “It has huge implications for the future of the city.”
Services »