Sale of CNN Center lease could lead to new owner

The exterior of the CNN Center building in Atlanta on Monday, May 17, 2021. (Alyssa Pointer / Alyssa.Pointer@ajc.com)
Caption
The exterior of the CNN Center building in Atlanta on Monday, May 17, 2021. (Alyssa Pointer / Alyssa.Pointer@ajc.com)

Credit: Alyssa Pointer/Alyssa.Pointer@ajc.com

AT&T acquires ground lease, air rights to landmark Atlanta property

AT&T has acquired a lease for CNN Center from the state of Georgia, a move that could be a precursor to a redevelopment of the landmark downtown Atlanta property.

AT&T’s Turner Broadcasting division this week paid $18.8 million to purchase the ground lease and air rights for the building.

AT&T announced in June 2020 that it would sell CNN Center, although it planned to lease back the building for at least five years and allow CNN to continue operating from there.

The deal comes as AT&T prepares to spin off WarnerMedia and combine it with Discovery and its stable of networks. WarnerMedia has about 6,000 employees in Atlanta who work for CNN, TNT and other cable networks. AT&T has not provided details on how the WarnerMedia spinoff will affect the company’s Atlanta-based workers.

If AT&T wants to sell CNN Center, it makes sense for the company to purchase the ground lease and air rights, said Nellie Shipley Sullivan, a real estate attorney at Womble Bond Dickinson who’s not involved in the deal.

A new owner could build whatever it wants on the CNN Center, within zoning requirements, if it’s not subject to a ground lease or air rights, she said. The owner could demolish the building or expand it.

If the new owner needs to finance the redevelopment of CNN, a bank would be more likely to lend money if the property is not encumbered by leases or liens, she said.

Robert Wheeler, a spokesman for AT&T’s WarnerMedia division, declined to comment. Turner Broadcasting is a business unit of WarnerMedia.

Frank Smith, deputy executive director of the Georgia State Properties Commission, confirmed that the transaction closed on June 14 but declined to comment.

The state had leased the rights to use the property to AT&T and its predecessor companies since 1973. CNN Center opened in 1976.

CNN Center is located next to the Gulch, a 50-acre site of empty parking lots and train tracks. Los Angeles-based CIM Group plans to develop a $5 billion mixed-use project on the Gulch site called Centennial Yards. CNN Center is connected to State Farm Arena, the Atlanta Hawks’ home court, and is near Mercedes-Benz Stadium, home of both the Atlanta Falcons and Atlanta United.