The new owners of Atlantic Station are preparing for the next phase.
Houston real estate giant Hines, which operates the retail town center, is currently overhauling storefronts, designing an expansion of its Central Park and putting the pieces together for the property’s largest expansion since it debuted more than a decade ago.
Among the projects expected in the coming years is a 300-unit apartment tower by developer AMLI Residential along Market Street that also would expand Atlantic Station's retail and restaurant space by about 25,000 square feet. Meanwhile, Hines and a partner are developing plans for a pair of new mid-rise office projects geared to tech and creative firms that when finished and fully leased could add a couple thousand more high-skilled workers to complex.
In other Atlantic Station news:
In total, about 57,000 square feet of additional retail is planned, and talks are underway about renovations to the Regal Cinemas to give the theaters inside a more luxurious experience, said Nick Garzia, director of retail leasing for Hines in Atlanta.
Garzia said he’s aiming for more local boutiques and first-to-market retailers and restaurants to fill the new space.
Midtown has seen a boom in new residential development and it's become a hive for tech companies seeking access to the talent at research institution such as Georgia Tech. Atlantic Station has been a beneficiary of that growth.
Pandora, Worldpay, Sage Software and GeoDigital are among the tech firms that took offices in Atlantic Station in recent years. The retail space, Garzia said, is about 90 percent full.
“As this market densifies and changes in Midtown, I think Atlantic Station’s importance in the years to come will only grow,” he said.
If looking at Atlantic Station by what its zoning allows, the complex is really less than half built. The “pinnacle site” — long asphalt pad home to Cirque du Soleil shows and other special events — is a future development site. So too are the openings in the giant parking decks along 17th Street.
Atlantic Station, the brainchild of noted developer Jim Jacoby and AIG Global Real Estate, was opened more than a decade ago as one of the most ambitious redevelopments in the country. What once was a polluted steel mill became a mix of high-rise offices, townhomes, condos and an outdoor shopping mall.
The Great Recession, however, was unkind. Many owners lost condos to foreclosure and a number of the stores and restaurants saw their sales pummeled by the fickle economy.
New owners and management came in with North American Properties, which along with an improving economy, helped turn the center around. Anchors of the property — Ikea, Publix, Target and Dillard’s — remained the same, but the restaurant and boutique mix improved. The center also added special events, from festivals to the BB&T Atlanta Open tennis tournament, that helped lure shoppers.
Hines and a fund led by Morgan Stanley took over the retail core in late 2015 and also controls additional land there. The “pinnacle site,” pitched as a potential corporate headquarters location, remains for sale.
Garzia said about 11 million visitors come to Atlantic Station each year. There are more than 4,000 office workers and the 3,100 apartments and condos are nearly full.
“Shopping centers have histories and shopping centers evolve,” he said.
Garzia said Atlantic Station was born, went through adolescence and is now preparing for adulthood.
The center’s retail core was designed as a sort of homage to Main Street America with brick store fronts. But the design has become dated, Garzia said.
Home furnishing retailer Z Gallerie recently opened a new store with a more modern look and bolder exterior that is likely to be a model for future store remodels. H&M, the young adult clothier, will soon expand their flagship space to 40,000 square feet with a similar “brand forward” design, Garzia said.
Another change expected in the near term will be the demolition of the former Strip restaurant space to expand Atlantic Station’s park. Two “jewel box” food and beverage concepts — possibly a coffee shop and whiskey or wine bar — are expected to replace the former restaurant space.
Harold Shumacher, a restaurant broker and longtime Atlanta real estate figure, said retail centers are in constant need of staying fresh and creating buzz. Atlantic Station is no different.
“I don’t think it ever hurts to bring in new restaurants, retailers and tenants to create new desire to people to go there,” he said. “People just have to know that amidst all the clutter.”
Loft style office plans
Shumacher said when Atlantic Station was developed, it was sort of a suburban-styled retail island between “Midtown proper” and the warehouse district called West Midtown. Many consumers saw the mini-city as an event destination.
Garzia said the project in the past gets penalized for what it isn’t. Atlantic Station isn’t on the Beltline, nor is it on Peachtree Street. But few other places in the city can boost its core of high-paying jobs, residents, retail mix and visibility.
Many of the early Atlantic Station office tenants were high-end law and professional services firms, but the latest wave of office users have trended more toward creative and tech firms.
In May, Hines announced a partnership with a client of Invesco Real Estate to build new, ground-up buildings that have features similar to popular adaptive reuse office projects, such as those at Ponce City Market and Armour Yards.
T3 West Midtown will be a timber-framed building at 17th and State streets, while Atlantic Yards is expected to feature a pair of mid-rise office buildings at 17th and Market streets.
Neither will be the typical marble lobby office building. Both will feature loft style office plans.
Hines announced plans to build the wood-framed T3 building in 2015, and The Atlanta Journal-Constitution reported in December of that year the company was considering a second office project where Atlantic Yards will rise.
At the time, Hines officials were considering a single building there, not two as Atlantic Yards is slated to be.
The company has said it expected to start on the developments next year.
Garzia said Atlantic Yards also will have retail and a “power dining” space.
In the future, Hines officials said the development is in need of a second hotel to join the Twelve hotel property.
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