Atlanta real estate firm focuses on development, distressed investment growth

Atlanta-based real estate firm Carter is launching an ambitious new focus, targeting $500 million in potential real estate development and investment opportunities.

It’s the latest sign of a thaw among commercial real estate players, though the market in metro Atlanta still has a long way to go.

Carter is concentrating its strategy around development of urban, infill mixed-use projects, educational facility and student housing development and investments in high-grade but distressed commercial property.

These opportunities, Carter President Scott Taylor said, are both in the Atlanta area and other locations in the Southeast as well as Midwestern states.

Demographic trends show a surge in young people looking for rental living in urban centers close to retail and other amenities. Universities and local school systems also face pressure from rising enrollment, and they need seasoned help developing new facilities in times of fiscal austerity, Taylor said.

Carter is master developer of the Banks, a $600 million mixed-use development in downtown Cincinnati, and education-related projects in Oklahoma and Louisiana.

Apartment development is hot and rents are up as renters make up a larger percentage of the residential pool following the housing collapse. Novare Group and Daniel Corp./Selig Enterprises, for instance, are launching separate 20-plus-story apartment towers in Midtown.

The planned redevelopment of the old City Hall East facility into the mixed-use Ponce City Market and recent sales of major office buildings are proof of renewed energy and less of a gun-shy attitude by real estate investors if the project has a good story to sell, said Summey Orr, managing partner of Atlanta commercial real estate law firm Hartman Simons & Wood.

Deals need the right price, the right tenants and/or the right locations.

“I don’t think it’s a booming activity, but it is a bit of a thawing as people see opportunities and take chances to find deals," Orr said.

Carter’s investment arm is seeking distressed office buildings in key markets with potential for a turnaround, Taylor said.

Office market vacancy remains around record levels, and a healing depends on the pace of job growth, he said.

Corporate America's use of office space, however, has fundamentally changed.

“Companies are going to be more efficient and more cautious as they look at their fixed costs” such as office space, he said.

The shifting focus follows Carter’s sale earlier this year of its brokerage and property management divisions to Cassidy Turley.