Some Smyrna residents question whether the city’s planned purchase of a bargain-priced apartment complex is a deal or a dud.
The city intends to buy and then demolish the 726-unit Hickory Lake apartment complex, which sits on a 48-acre tract along Windy Hill and Old Concord Roads. The Smyrna Downtown Development Authority will issue bonds to raise the cash to purchase the property for $9.5 million and another $4 million to raze it.
City leaders say those costs and more would be recouped by selling at least part of the land to a developer, if all goes as planned.
“Our primary reason for doing it is an opportunity to control 48 acres at the gateway to the city for economic development purposes,” said City Administrator Eric Taylor. “There is a strong desire to see some redevelopment and we feel like we need a catalyst project to get it going.
But completing a redevelopment deal will be tough in this economy, Georgia State University real estate professor Alan Ziobrowski said.
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“I wouldn’t do it,” he said, adding that “it’s just not clear they will be able to sell it to a developer at a reasonable price; someday at a reasonable price, maybe. But there is nothing about Atlanta right now that says to me that you’re going to see a lot of commercial property development of any kind.”
The city has already had informal discussions with developers interested in purchasing the property, according to redevelopment coordinator Andrea Hall. The corner property sits close to the Windy Hill road connector project, which is expected to be completed next year. Hall said the connector will increase traffic to the area, making the land a prime location.
The apartments are owned by Capmark Affordable Equity, a subsidiary of Pennsylvania-based Capmark Financial Group, which filed for bankruptcy in October 2009. The entire property, including the land was appraised at $23.8 million this year. After being put up for sale some time ago, the property has been back on the market about three months, said Gina Dowdy, regional manager for First Communities Management, which handles operations for the complex.
Smyrna’s offer was $5 million lower than the company’s $14.5 million asking price.
Calls to Capmark were not returned.
Glen Darby’s real estate office is just down the street from the complex.
“I’m not sure Smyrna should be doing this right now. The city has too many areas where they’ve torn things down and haven’t built them back up,” he said. “There are many other things they could be spending money on.”
City resident and outspoken council challenger Mary Kirkendall agreed.
“Why would they even buy this land in the first place? Let the private developers buy these properties,” she said. “We don’t know what the city is doing. We never know what the city’s plans are.”
There was no discussion of the project and bond agreement during the council’s meeting and vote on Oct. 4. Councilman Wade Lnenicka cast the only dissenting vote, but would only say last week he has concerns about the project when asked by the AJC to elaborate.
A public meeting scheduled for next week to get community input on the plans was canceled because negotiations haven’t reached a point to disclose more information, Hall said. No makeup date has been set.
Smyrna has had success with this type of redevelopment, Hall said, citing the Market Village downtown redevelopment and the Belmont Hills project at Windy Hill and Atlanta Roads. The economy has stalled the $250 million mixed-use Belmont project, which was slated to open this summer, but the developer is still committed to finishing, Hall said. A $130 million mixed-use development project, Jonquil Village, at Atlanta and Spring Roads, has also stalled. The city purchased the Smyrna Commons apartment complex off Ward Street for a road right-of-way, and still operates operates the apartments through its housing authority.
It cannot afford to operate Hickory Lake as an apartment complex while waiting for a developer to emerge, Hall said.
In addition to the economic development potential of the site, city leaders have mentioned crime as one of the key reasons for shuttering Hickory Lake apartments.
Crime reports at Hickory Lake this year have been triple that of other similarly-sized complexes elsewhere in the city, including 21 assaults involving a gun, 28 burglaries, five robberies, two sexual assaults, seven vehicle thefts and a dozen drug possessions. No homicides have been reported over the past two years.
Statistics from the Smyrna Police Department indicate a total of 195 crimes were reported in the complex last year. Between Jan. 1 and Sept. 30 of this year, 122 crimes were reported.
Other apartment complexes like Keeneland Farms, The Village at Lake Park and Wyndcliff Galleria had 21, 42, and 41 crimes reported respectively during the same time frame.
Hickory Lake resident Donte Roberts, 20, heard about the sale on the news, and said crime in the complex has worsened in the past few years.
He’s still sad to see the apartments go.
“It’s tearing down my childhood, basically, because I used to stay here when I was very little,” Roberts said.
If the sale goes through, the city plans to tear down the complex sometime next year and help residents find other housing, but they will not be paid to move.