$5 billion proposal aims to save ATL banks, build parks

By Dan Chapman

The Atlanta Journal-Constitution

Just in time for the nation’s next likely financial crisis -- an implosion of the commercial real estate market -- comes an audacious plan to rid local metro Atlanta banks of problem loans and, in the process, add thousands of acres of parkland.

Distressed communities would be revitalized. Tight-fisted banks, eased of troubled assets, would start loaning money to jump-start the economy. And, best of all, the Obama administration would pick up the tab.

The newly formed Red Fields to Green Fields Atlanta Inc., the nation’s first not-for-profit organization aiming for stimulus money to clean up banks and blighted neighborhoods, is seeking $5 billion for the metro area.

“The biggest question we get asked is, ‘Is this real?’ " said Laura Hughes, the group’s unpaid CEO. “Well, when they were bringing the Olympics to Atlanta that sounded impossible at the time. But there was a small group of people with the audacity to push it. And that’s what we’ve got now.”

Potentially insurmountable problems await, though. First up: No such federal program exists. Budget-conscious federal officials could nix the proposal.

Local developers may not like federal dollars competing for projects they have also targeted. And the nation has little appetite for bailing out banks.

Still, the Atlanta push is gaining traction. An under-the-radar campaign to win over the region’s business and political communities, and raise $600,000 to carry the fight to Washington, has attracted wide support. Communities in Atlanta, Cobb, DeKalb, Fulton and Gwinnett counties have signed on, though not many have given money.

Hughes, Georgia Tech -- which provides the intellectual heft for the Green Fields project -- and various community improvement districts have identified some potential park and redevelopment sites, including Smyrna’s old Belmont Hills shopping center; a strip mall at Indian Trail Road and Lawrenceville Highway in Lilburn; Prospect Park in Alpharetta; and the Beltline, Fort McPherson and the Bellwood Quarry in Atlanta.

Michael Messner, a well-to-do Georgia Tech alum with a penchant for parks, commissioned Tech’s Research Institute to investigate ways to help Atlanta sidestep the impending commercial real estate morass. Messner, the institute’s Kevin Caravati said, proposed sprinkling "a fairly arbitrary number" of $5 billion across the distressed region.

Caravati, a senior research scientist, sees parks as solving the urban real estate crisis. Atlanta would also benefit, Georgia Tech says, because it is among the poorest cities in the nation when it comes to the amount of parkland.

“And there hasn’t been a bailout of Main Street yet,” Caravati added. “The original stimulus money took care of the big banks by bailing out their paper assets. But we haven’t taken care of the physical assets -- the vacant Circuit City store, strip mall, apartment complex or warehouse.”

Only about a quarter of the $787 billion American Recovery and Reinvestment Act has been awarded so far, according to recovery.gov, the federal Web site tracking stimulus spending.

Banks across metro Atlanta remain stuck with billions of dollars worth of properties that can’t be sold or developed. Hughes, the executive vice president of Fortis Engineering, wants to buy these properties – many vacant lots are going for 25 cents on the dollar – and get them off the banks' books. That would allow the banks to begin lending again, stimulating the economy, she said.

Roughly $3 billion of the $5 billion proposed for metro Atlanta would buy land. The rest would go for demolition, design, construction and maintenance of the parks. If $3 billion were spent just inside the Perimeter, it could create 15 Piedmont Parks, Georgia Tech says. Roughly 13,000 acres of green space outside the Perimeter could also be created.

But parks are only part of the package. Say, for example, 100 acres of blighted property is bought. Maybe 30 acres is set aside for a park, the rest to be developed later. A park, Georgia Tech notes, increases the value of surrounding property.

“So maybe in five years, when the market bounces back, that property that was sold for $20,000 an acre may be worth $100,000 an acre,” said Caravati, adding that the not-for-profit would control the properties until they’re turned into parks or redeveloped.

The Cumberland CID, which helps fund road, streetscape and recreational projects in the Galleria Mall area, has promised as much as $100,000 of the $600,000 needed to help lobby Washington.

Malaika Rivers, the CID's executive director, said her board likes the proposal because "it would not only assist with the health and viability of commercial properties in our community, but it would also advance streetscaping, parks and recreation efforts that are important to us."

Time is crucial. Atlanta hopes to become the federal government's "pilot" city, but a dozen other cities have started to inventory their park needs and real estate woes in hopes of applying for stimulus money.

“The real estate crisis is coming,” Hughes said. “We’re hoping to have a program in place so that when it hits and the [Obama] administration is looking for something to immediately address that crisis they can reach for us."