Mixed-use project gets $15M tax break in hot DeKalb neighborhood

$180M project’s tax abatement request has been in limbo since 2020
This is a rendering of Manor Druid Hills, a mixed-use project in south Brookhaven.

Credit: The Related Group

Credit: The Related Group

This is a rendering of Manor Druid Hills, a mixed-use project in south Brookhaven.

A DeKalb County authority reversed itself Thursday and approved a $15 million tax break it previously shelved for a mixed-use project in a fast-developing area near two new hospital campuses.

The county’s development authority, called Decide DeKalb, voted 5-1 to approve the tax abatement over a decade for Manor Druid Hills. It comes a month after the item was a vote shy of passing. The Related Group, the Miami-based developer of the project, argued the tax break was critical to subsidizing workforce housing at the project.

The DeKalb County school board and several county commission members opposed the tax break, saying the apartment, hotel and medical office development in a booming area shouldn’t need subsidies.

“The developer is more than capable of funding and executing the project through conventional means, rendering the tax abatement inconsequential,” DeKalb County Board of Education Chair Diijon DaCosta said in a letter to Decide DeKalb leadership.

Related Group plans to tear down a dilapidated shopping center known as Briarcliff Station on the corner of Briarcliff and North Druid Hills roads. In its place, the developer plans to build 381 apartments, a 140-room hotel and medical offices.

Seventy-six, or 20% of the residences will be reserved at rents below market rate. Four units will be at 60% of the area median income, or about $57,840 for a family of four. The developer will offer 38 units each for people making 80% and 120% AMI, which respectively is $77,120 and $115,680 in annual income for a family of four.

“Decide DeKalb welcomes projects that make sense for all of DeKalb — and this project makes sense based on the services it will provide to the metro area, jobs it will create, and affordable housing it will offer,” the authority said in a statement.

Affordable housing is generally reserved for people making less than 60% of the area median income, while workforce housing is a term that generally applies to people making greater than 60% of a region’s AMI up to 120%.

01/02/2020 — North Druid Hills, Georgia — The exterior of Briarcliff Station, a shopping complex located near 2601 Briarcliff Road, in the North Druid Hills neighborhood in unincorporated DeKalb County, Thursday, January 2, 2020.  (ALYSSA POINTER/ALYSSA.POINTER@AJC.COM)

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The project site is adjacent to massive Children’s Healthcare of Atlanta and Emory Healthcare campuses. The area was annexed into Brookhaven in 2020.

Due to opposition from DeKalb school officials and county leaders, the Related Group asked Brookhaven to approve the tax abatement. DeKalb’s commission threatened to oppose them in court, however, prompting the developer to return to Decide DeKalb to pursue tax savings.

A majority of the DeKalb Commission opposed the tax break. Commissioner Michelle Long Spears spoke against the project during Thursday’s meeting, arguing other projects need these incentives.

Development authorities, members of which are appointed by city and county elected leaders, are independent agencies. They wield outsize influence in the recruitment of jobs and investment, but many critics say the agencies often grant incentives to projects that would be built anyway.

“The proposed abatement on this project sincerely undermines the spirit of abatements as an economic development tool,” Long Spears said. “... It is clear that a broad range of community voices do not support this proposal because the public benefits are lacking or non-existent.”

An aerial view of the planned site for "Manor Druid Hills," a mixed-use development near Briarcliff and North Druid Hills roads. The buildings inside the yellow lines would be replaced with office space, a 140-room hotel and nearly 400 apartments. SPECIAL PHOTO

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Last fall, Decide DeKalb gave an initial OK to the $15 million abatement, but the authority had to approve bonds central to the tax savings last month, coming up one vote shy. The Decide DeKalb board has two unfilled positions and needs five affirmative votes to adopt items.

Andrew Greenberg was the sole dissenting member Thursday, while Kevin Gooch was absent. County Commissioner Robert Patrick, who also serves on the authority board, voted for the project, despite the opposition of majority of his fellow commissioners.

The Related Group said its project would bring in nearly $10 million in new property taxes over the next decade, even with the abatement.

The developer will also pay $2 million in a payment in lieu of taxes program, often called a PILOT, to soften the blow of the abatement for nearby schools. In addition, the Related Group will provide $4.5 million in roadway, sidewalk and greenspace improvements.

“We intend to be a good neighbor and will continue to look for ways to ensure this is a great project for DeKalb County,” the developer said in a statement.

Construction of the apartments is slated to start later this year with opening in 2026. The medical offices are on a similar timeline, while the hotel is expected to open in 2027.