16-story office building near Perimeter Mall sold for nearly $200M

The new Twelve24 building towers over nearby Perimeter Mall.
Caption
The new Twelve24 building towers over nearby Perimeter Mall.

Credit: Courtesy/Trammell Crow Company

A 16-story office tower in Dunwoody, which became one of the largest developments to open at the onset of the COVID-19 pandemic, changed hands for nearly $200 million.

Trammell Crow Company sold the Twelve24 building, located near Perimeter Mall, to Office Properties Income Trust for $195 million, excluding closing costs, according to a Monday news release. The nearly 346,000-square-foot building is primarily leased to Insight Global, a staffing agency, as its corporate headquarters.

Twelve24 was planned since 2017 and was codeveloped by Trammell Crow and CBRE Global Investors. When it opened in spring 2020, it became an early case study for the challenges facing office developers amid the pandemic.

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Brandon Houston, a Trammell Crow principal, previously told The Atlanta Journal-Constitution that finding tenants was initially a challenge, leaving the large building with several unleased floors last summer.

On Tuesday, he told The Atlanta Journal-Constitution via email that the company is pleased to have developed and sold Twelve24, which he described as “truly unique in the high-end office space” market.

“Twelve24 offers tenants a flexible and technology-enhanced environment, which will continue to help attract businesses to this area of Atlanta for years to come,” Houston said.

The glass tower, named after its location at 1224 Hammond Drive, is near the Dunwoody MARTA station and includes an amenity deck with yoga lawn and lounge chairs. It also houses a fitness center, cafe, ground-floor retail space and more than 1,000 parking spaces.

Insight Global currently leases 96% of the building, and the tower is 98% leased overall, Office Properties Income said in the release. Iron Hill Brewery & Restaurant agreed to lease roughly 7,500 square feet of ground-level retail space at Twelve24 in 2019, and its website said it’ll open this summer.

Office Properties Income, based in Newton, Mass., is a real estate investment trust, which focuses on owning, operating and leasing properties primarily leased to single tenants or governments. On Monday, it also announced it purchased the Chicago-based 1K Fulton office tower, which acts as Google’s Midwest headquarters, for $355 million.

Chris Bilotto, president and chief operation officer of Office Properties Income, said in an email to the AJC that the company is bullish on the Southeast and Atlanta. He said the company already owns nine office properties in metro Atlanta.

“We pursued Twelve24 because of its market location and its alignment with our investment criteria as a Class A property, long-term leased to a high-credit, quality tenant,” he said.

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The company, which is managed by The RMR Group LLC, said it used cash and a $350 million loan, an unsecured credit facility, to fund the two acquisitions. It plans to sell non-core properties to repay the loan.

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