920K SF South Fulton Development Lands Another Tax Break

Developers planning a 60-acre development south of Atlanta will get a tax break from Fulton County’s development authority.

Develop Fulton approved a $6.3M tax incentive at its Oct. 9 meeting for Sandtown Village, a 920K SF mixed-use development on undeveloped land proposed by Hutch Development LLC, The Atlanta Journal-Constitution reports. Hutch also received $9.7M from the South Fulton Downtown Development Authority last year for infrastructure changes associated with the project.

Hutch, an Atlanta-based developer, plans to build 288 apartments and up to 137K SF of mixed-use commercial space. Hutch Development also plans to build 132 single-family homes and townhouses, according to Develop Fulton’s meeting agenda.

The $6.3M tax abatement would only apply to the apartments and retail Hutch Development plans to build for Sandtown Village, not the single-family homes and townhouses.

South Fulton officials hope the development can draw grocery stores and upscale retail to the city, which is 15 miles southwest of Atlanta. The development is projected to generate $16.5M in tax revenue after the tax savings and generate 366 full-time jobs, according to the agenda.

Georgia law adds wrinkles to municipalities and development authorities offering such incentives. The Gratuities Clause of the state’s constitution forbids lawmakers to “grant any donation or gratuity or to forgive any debt or obligation owing to the public.”  Developers and municipal entities often agree to transfer ownership of land or buildings to the local bonding authority — Develop Fulton in this case — to clear the way for the tax break.

For the $6.3M in savings, Hutch will temporarily grant the title of Sandtown Village’s properties to Develop Fulton, which will then rent them back to Hutch for what would essentially be a discounted tax rate to realize the savings.

Hutch Development didn't respond to requests for comment.

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