Emory Point plan runs into finance hurdles

A mixed-use project adjacent to Emory University is stalled because one of the developers is having trouble getting financing.

Emory Point, which is to have apartments, condominiums and retail, was supposed to get under way this quarter. But Gables Residential, the developer of 275 apartments in the project’s first phase, has not yet found financing.

Gables and Cousins Properties are partners in the project.

“It now appears this project will be delayed into next year due to our apartment partners’ need to find financing … in this very difficult market,” Cousins CEO and Chairman Tom Bell told analysts Thursday.

“For us, that may not be such a bad thing because it will give us some more time for the financing markets to improve for our condominium buyers,” Bell said. “We and Emory continue to be extremely excited about this project.”

A spokesman for Gables, a private real estate investment trust, could not be reached for comment.

Cousins’ role is to develop 93,000 square feet of retail and restaurant space and 172 condos.

The site is close to the Centers for Disease Control and Prevention and the Veterans Administration hospital.

In the earnings call, CFO Jim Fleming told analysts Cousins has tapped lines of credit to boost its cash position from $50 million to $90 million since the end of the third quarter. That’s enough to fund projects currently underway, Fleming said.

Cousins has relationships with multiple banks. Companies like Cousins that depend on credit are concerned about the viability of some financial institutions.

“We’re very cautious about starting any new development in today’s environment,” Bell said. “As a result, we’ve pushed back our start dates to 2009 or later.”

The collapse of Linens ‘n Things this year means Cousins is potentially out $978,000 in rent next year unless other renters are found for the space, Fleming said. Linens ‘n Things operated at four retail centers where Cousins has an ownership stake.

Bell said Cousins continues to look for distressed properties to buy, but “we’ve not found anything to date that is compelling.” He said banks will be getting more foreclosures, so the selection of buying opportunities will increase.

“We’re confident the deals are out there and we’re prepared to wait for them,” he said.

Bell said Cousins is offering additional concessions as it tries to sign the first office tenants at Terminus 200 in Buckhead.

“We’re having to compete in a market with too much supply,” he said.

Cousins has sold 12 units at its luxury Buckhead condo tower, 10 Terminus Place, and 22 units are under contract, Bell said.

Residential development comprise about 8 percent of Cousins’ portfolio. Bell said sales are slow and “frankly, we don’t expect to see much improvement in our residential business in 2009.”