And it was a fantastic dream, even by Atlanta standards. On this tract, one of Atlanta’s premier developers had a vision for one of Atlanta’s premier properties — the “Rodeo Drive of the South,” he took to calling it.
What’s there now is but a half-built version of that dream: a deep hole filled with rebar; a haggard, unfinished parking deck; and construction debris.
It is unclear when the cranes will start working again.
Some say the property — where construction on an upscale retail development stalled — is hurting businesses and making traffic dangerous, and is a blight on Buckhead’s reputation.
Others say the site is evidence of progress — necessary growing pains.
“We all cheered when the wrecking ball took down Lulu’s Bait Shack,” said Howard Shook, an Atlanta city coucilman who represents part of the area, referring to a popular but rowdy bar that is now gone.
“By the way,” he said, “no one gets murdered there anymore so I think it’s a pretty slick deal for the citizens.”
The site was supposed to become the Streets of Buckhead, the $1.5 billion brainchild of Atlanta developer Ben Carter.
Raised in Buckhead himself, Carter had enough clout to do the unthinkable: buy and then raze a good portion of Buckhead’s party district to rebuild it as a high-end shopping area filled with purveyors of cashmere and pearls, such as Van Cleef & Arpels, Hermes and Brunello Cucinelli.
But for real estate moguls — not just in Buckhead but across the country — the waning years of the decade were dream killers. Financing dried up for everything from small subdivisions to giant urban redevelopments, and Carter ran out of money long before he ran out of project.
A few weeks ago, he announced he is losing control of the Streets of Buckhead; chief investors are bringing in San Diego-based OliverMcMillan to do the job instead.
The new firm is officially mum on its plans, but it is expected to follow through with at least some of Carter’s ideas.
To be sure, the project was among the more high-profile retail concepts marketed in the last part of the decade — Carter and his team often jet-setted to New York and Europe to sell their vision to upscale retailers.
“This may be one of the more glamorous projects, but is one of many where the rug was just pulled right out from under the developer,” said Lorraine Adney from Chicago, where she represents retail tenants as director of the Midwest region for the McDevitt Co. “It’s just that sometimes the higher you fly the worse it may look.”
Carter’s timing was unfortunate, she said, as it coincided with the credit market shutdown, the economy stalling out and retailers backing off new deals.
Amid the wreckage of his dream, those five dormant cranes cast a long shadow: The businesses that remain in the district say they’re suffering because of the stalled-out Streets project.
“When you take out 8-plus acres of the best real estate in a particular business district, you remove a lot: lunchtime traffic, critical mass for retailers, and an energy and a vibrancy that they would love to see return,” said Brad Glenn, vice president of Southprop, an Atlanta-based, family-owned real estate company that recently bought a property nearby.
Businesses that had remained near the site — such as the Park Bench and restaurant ESPN Zone — closed after the foot traffic they fed off for years dried up.
Other Buckhead businesses and citizens are growing restless.
“Business is down,” said Sibel Ozelci, one of the owners of Cafe Agora, a 6-year-old Mediterranean restaurant directly across from the construction site. “It used to be that during lunch you couldn’t get in because it was packed. Now it’s not.”
Raja Restaurant nearby tells the same story, as does Bradley Stone, the owner of Buckhead Safety Cab Co.
“In the heyday of Buckhead, a large percentage of our calls originated from those bars. People were coming from all over because that was the nightclub scene at the time,” Stone said. Its disappearance “hurt the taxi drivers considerably.”
The tattered site along Peachtree Road, just blocks from million-dollar condos and some of metro Atlanta’s most expensive homes, prompted inquiries from Buckhead housewives worried about the area’s reputation, said Sam Massell, president of the Buckhead Coalition and a former Atlanta mayor.
That’s why he had sent Carter a letter asking for a specific timeline for getting the project restarted.
“Everybody realized that he had gambled. He put his name on the dotted line, his cash in the concrete. You know we wanted him to succeed. It was reaching the point where we had to have more than just intent to do well,” Massell said.
However, one of Carter’s chief backers defends the progress the developer made, saying he should be admired for that.
“He assembled very small parcels into much larger parcels that are developable,” said Robin Loudermilk, president and CEO of Aaron’s Inc., which was founded by his father, Charlie. The family also owns many neighboring properties in Buckhead, and Aaron’s headquarters faces the construction site.
“I’d say the glass is 60 percent full,” Loudermilk said. “Carter really did the city and Buckhead a favor.”
In 2006, with the help of the Loudermilks, who were leading the charge to shut down the clubs and bars that were the scene of murders and other violence in the village, Carter purchased 34 properties. He sometimes paid as much as $500 per square foot — about double what prices were in the already-heated market at that time.
As recently as 2008, Carter had offered $24 million to buy the Buckhead Library — considered a prized architectural gem by some — proposing to rebuild an exact replica elsewhere. The deal was never approved by Fulton County officials.
Carter was paying steep prices to entice reluctant, long-term owners to part with their prized properties.
“We had no idea Ben could assemble all this land from all these different landowners,” Charlie Loudermilk told The Atlanta Journal-Constitution at the time. “But as is always true, money talks.”
Then the bottom dropped out of the real estate market.
“What we paid is because that’s what it took to buy the land,” Carter told the AJC on Friday. “I started off a lot lower in my offers, and nobody would sell. So once I found out what people were willing to sell for, that’s what I had to rise up to, but I still felt like I could make money at that.”
Carter’s land grab cost him dearly. Before construction was even finished on the parking deck and other infrastructure, he had spent about $340 million in land and construction costs, but needed $200 million more to finish the job.
Carter’s cranes stopped cold in 2009, as he ran out of construction cash and failed to get more.
By then, his plans had been scaled back from multiple hotels, condos and an office tower to an $800 million project with only retail, parking and apartments. His opening date reflected a three-year delay.
Carter said he hasn’t been hurt financially by the stalled project because he did not personally guarantee it. He and three friends invested $20 million combined. Bank of America loaned him $170 million while CBRE Investors loaned another $150 million.
But the loss is a heavy blow to Carter, who saw this as a legacy project. For him now, he said, “The No. 1 thing I want is to get the project finished.” He is cooperating with the new firm to transfer the plans, he said.
Carter’s plans may have been too risky to begin with.
“You have to start by remembering that what he wanted to do was considered highly ambitious, even under the best of circumstances,” Shook said. “Some people who do commercial development for a living said all along that he wasn’t going to be able to pull it off.”
Regardless, Shook said, the project became a symbol for Atlanta’s real estate market.
“A lot of people are going to say if you can’t do a project in historically go-go Buckhead, then that’s a strong indicator of Atlanta’s health,” he said.
That idea is reflected within feet of the stalled project. Nearby storefronts have not filled up, despite promises to one day be near the “hautiest” of haute couture destinations in Atlanta.
“We have prime spaces over there and we don’t get too many calls on them right now,” said George Rohrig, president of Cartel Properties. “It’s definitely hurting us being around the project.”
David Franco is in the same boat. The longtime commercial broker is trying to lease the former Geek Squad storefront on the prime corner where East Paces Ferry meets Peachtree Road.
“We’ve had some interest in it, but prospects would be more encouraged if they saw activity going on down the street,” Franco said.
To be sure, if OliverMcMillan completes the project the way Carter intended — with the equivalent of three Home Depots worth of luxurious shops and restaurants — that part of Buckhead Village could be back in business.
That is worth the wait, and the gamble, for some entrepreneurs.
Ozelci, Cafe Agora’s owner, said she’s holding out for the completed Streets of Buckhead project.
“When it’s finished, we have a goldmine down there. We are waiting for that.”