News

Development adds to Cumberland/Galleria activity

By Martin Sinderman
Atlanta Business Chronicle
Published on: 12/15/06

A major new mixed-use development promises to generate even more activity on an already high-profile site in the heart of the Cumberland/Galleria market.

Planning is under way by Grove Street Partners LLC for an as-yet-unnamed office/residential/retail project on a tract bounded by Interstate 75, Akers Mill Road and Cobb Galleria Parkway. Located adjacent to and just south of the $145 million Cobb Energy Performing Arts Centre, set to open in September, the project is envisioned to include a 15-story, 350-000-square-foot office tower; an 18-story combination 200-room hotel and 38-unit residential condominium tower; a roughly 1,000-space underground parking facility; and amenity retail stores and restaurants.

Headed by former Carter executives Kevin Kern and Chip Groome, Grove Street Partners is an office and industrial development, management and leasing company whose other Atlanta-area developments include 800,000-square-foot-plus distribution centers in Jackson (about 60 miles northeast of Atlanta on I-85) and Henry counties. It is one of several real estate companies bankrolled by a $100 million investment fund led by founder and former CEO of Post Properties Inc. John Williams, who also contributed $10 million toward construction of the Cobb Energy Centre.

Now finalizing its recent purchase of the tract from the Cobb-Marietta Coliseum and Exhibit Hall Authority, Grove Street hopes to start construction on the project within a year, Groome said. Meanwhile, the group is in discussions with the Georgia Regional Transportation Authority (GRTA) regarding providing dedicated automobile parking spaces for a massive, $93 million bus station proposed for construction over I-75 at Akers Mill Road, part of a proposed $600 million bus transit system serving that interstate highway corridor in Cobb County.

Occupants of the project's office tower will include Corporate Holdings LLC, Williams' umbrella company, which occupies more than 80,000 square feet at One Overton Park, the 390,000-square-foot, 15-story office building recently sold by Hines to Wakefield, Mass.-based Franklin Street Properties Corp. Conversations are already under way with other potential tenants, "but it's way too early to say who they are," Groome said. On the hotel side, "we are in negotiations with a number of national operators," he added.

The Grove Street development as envisioned could have a number of positive implications for both its immediate surroundings and on the Cumberland/Galleria market as a whole.

The critical mass generated by the performing arts center and the Grove Street project could spur a start on redevelopment of Galleria 75, the rwo-story, 113,000-square-foot office building on the 7-acre site immediately to the south that Cousins Property acquired in 2004.

"The activity taking place literally next door makes [the Galleria 75 site] ideal for redevelopment," said Cousins spokesperson Matt Gove. "That's why we bought it in the first place."

The project's contribution to Cumberland/Galleria's residential inventory is also important, said Jim Durrett, executive director of the Livable Communities Coalition, an organization whose goals include supporting more housing opportunities in metro-area activity centers.

"Anything you see furthering residential development in Cumberland/Galleria is a good thing," he said.

Compared with other centers, such as Buckhead and Midtown, Cumberland/Galleria has been somewhat of a "late bloomer" in this regard, he said, "but the research that has been done indicates that there is a real opportunity there, and I'm not surprised to see the market embrace it."

Combined with other developments on tap, including the 110-unit Park Vinings condominiums, the 60 condo units planned for the second, mixed-use phase of Overton Park and B.F. Saul Co.'s planned condo tower at Circle 75, the residential component of the Grove Street project will help accommodate demand for housing in Cumberalnd/Galleria, according to Cobb County Board of Commissioners Chairman Sam Olens.

"For years we have talked about the imbalance between jobs and housing in many of Atlanta's regional activity centers, including Cumberland/Galleria," Olens said. "We're now seeing significant investment under way to help narrow that gap, and the development plan by Grove Street represents another step in the process."