The eight-story structure — multiple buildings connected as one — is more than a mile walk south of Philips Arena near the Richard B. Russell Federal Building, suggesting CIM has a more expansive real estate footprint in mind than just the immediate area around the Hawks' home.
A spokeswoman for Norfolk Southern declined to comment Tuesday, citing the company’s policy on real estate matters.
CIM co-founder Richard Ressler did not immediately return messages seeking comment.
Ressler is the brother of Hawks lead owner Tony Ressler. CIM would control the property, the people familiar with the matter said. The people agreed to speak on condition of anonymity because of the sensitive nature of real estate purchases.
Tony Ressler has spoken of a desire to see a more vibrant downtown, and said the Hawks could be a catalyst. It's unclear if the Hawks will have a direct role in redevelopment of the Norfolk Southern site, though it is expected the team will be heavily involved in any projects close to Philips Arena.
‘A major win’
Real estate development near arenas, such as the mix of retail, apartments and restaurants next to the new Braves stadium in Cobb County, has become a critical piece for many sports franchises, generating new revenue streams.
Attempts to contact a Hawks representative were not immediately successful Tuesday.
CIM controls hotels, apartments and office buildings across the U.S. The company has business ties to the Kushner Companies, the family real estate business of Jared Kushner, son-in-law to President Donald Trump and a White House adviser.
CIM also owns the Trump SoHo tower in New York, which the firm took an interest in when the project ran into legal and financial trouble following the financial crisis.
Mayor Kasim Reed has said a recent deal reached by the city and the Hawks to overhaul Philips Arena would lead to downtown redevelopment.
Downtown is booming unlike any time since the 1996 Summer Olympic Games — with billions in new development underway or on the drawing board. Mercedes-Benz Stadium, the new home to the Falcons and United soccer franchise, opens this week.
The main Norfolk Southern building spans part of the derelict Nelson Street bridge, a once vital link over downtown’s weedy tangle of parking lots and railroad tracks that has been closed to vehicles for several years. People familiar with the matter said a replacement of the bridge or improvements that would help aid the flow of rail cars are likely to be part of negotiations for the property.
CIM’s plans for the massive building aren’t clear. The building is narrow, yet spans two downtown blocks. It could be prime for a Ponce City Market-style rehab into loft office space, retail and residences.
Kyle Kessler, an architect and downtown advocate, said the empty structures and two other vacant Norfolk Southern buildings to the south have held back redevelopment of the area.
“To have a building like that occupied would be a major win for south downtown,” he said.
A plan to make the bridge functional again would help connect south downtown to the bustling Castleberry Hill community, Kessler said.
Create a vibrant downtown
The buildings are largely unused after the railroad moved its corporate offices to Midtown. The complex has been popular with Hollywood, serving as a filming location for “Captain America: Civil War” and scenes from “The Walking Dead.”
The railroad company quietly solicited requests for proposals for the main building on both sides of Nelson Street, as well as adjacent land and the two brick buildings south of the main complex across Peters Street.
It is believed CIM’s plan is to acquire all of the property.
Developer interest in south downtown is at a high-water mark for the past few decades.
German developer Newport US RE is buying up blocks of historic buildings and land downtown, and it is negotiating to purchase the nearby former C&S Bank headquarters building on Mitchell Street. The firm at one point also had interest in the Norfolk Southern property.
A South Carolina group, meanwhile, closed in March on its purchase of Underground Atlanta with plans to convert the struggling mall into a mix of retail and apartments.
The Hawks and the city of Atlanta recently completed a deal for a $192.5 million overhaul of Philips Arena, including $142.5 million in public financing.
In March 2016, amid arena negotiations, the AJC first reported the team's discussions with the city about an entertainment district and mixed-use development near Philips. In June, the AJC first reported the Hawks and their partners were in advanced discussions with key land owners, including the city and Norfolk Southern, to acquire or take on development rights to parcels in and around the Gulch.
But at the time, it wasn’t clear which parcels the partners had in their sights.
What a potential purchase of land by CIM and others in the Gulch might mean for the long-dreamed, but unfunded, plan for a downtown multi-modal transit terminal isn’t clear.
Tony Ressler has said the Hawks want to work with other groups also interested in downtown revitalization.
“This is far too extraordinary a city to have a downtown that isn’t much more vibrant,” he told the AJC last year.
CIM pushed a bill in 2016 for tax incentives from the state Legislature for Gulch redevelopment, but that bill failed to pass in the form the group sought. A bill signed this year by Gov. Nathan Deal, however, could enable tax incentives for such a project.
House Bill 342 would allow sales and use taxes from retailers to be used to pay off bonds for infrastructure in certain areas defined as enterprise zones. The bill attracted little notice during the session.
HB 342 requires projects of a minimum of $400 million investment within a government-defined area certified as “chronically underdeveloped for a period of 20 years or more.”
The enterprise zone would be established for a period of 30 years. The incentives cannot apply to casinos.
Staff writer Greg Bluestein contributed to this report.