Hines Readying Plans for 3rd Atlanta Office Project
As a major international developer reaches for the sky with two new projects in Midtown, it also is laying the groundwork to go forward with a third Atlanta tower in Central Perimeter.
Hines has updated plans for 700 Northpark, a 468K SF proposed office tower off Abernathy Road and Georgia 400 in Sandy Springs. It would represent the fourth building in the Northpark Town Center mixed-use office complex, a complex largely owned by Cousins Properties.
At Hines' two current projects — Atlantic Station, where Hines is already underway on a new timber-framed office tower, and its brick-framed Atlantic Yards building — the developer moved forward without any pre-leasing activity. At 700 Northpark, the developer will wait to grab a significant lease before breaking ground, Hines Senior Managing Director John Heagy said.
“While we are not planning to build on a speculative basis, we are preparing ourselves with a fully designed and priced office building to be ready for a construction start this fall — as soon as we secure a lead tenant commitment,” Heagy wrote in an email.
As of 2019, there are only two office projects significantly underway in Central Perimeter: the second phase of State Farm's corporate campus in Dunwoody, which encompasses more than 1M SF, and Trammell Crow's Twelve24 300K SF building.
That project broke ground on spec, but last year, Insight Global signed a 205K SF lease there, ensuring Twelve24 would be over half-full when it opens.
The submarket is gaining momentum with office leasing activity. Last year, landlords in Central Perimeter saw companies lease 450K SF more than they vacated, known in real estate parlance as positive absorption, a key metric on determining the health of a market. The activity is prompting Colliers International to be bullish on the submarket.
“Central Perimeter should be a leading submarket yet again in 2019,” Colliers officials wrote in a recent report.
Heagy said companies want to be located as close as possible to one of Central Perimeter's four MARTA stations. Its 700 Northpark project is within walking distance to the Sandy Springs station. Hines is in discussion with a couple of prospects, but Heagy declined to identify them.
Still, Hines is not without its competition for Central Perimeter's next office tower. Ackerman & Co. has been marketing a former MARTA park-and-ride site just across Georgia 400 from Northpark Town Center for a 550K SF office project called Abernathy 400.
And GID, in conjunction with North American Properties, has plans for a massive mixed-use project called High Street Atlanta in the heart of Dunwoody. Once completed, High Street could encompass 1,500 apartment units, 1,500 condominium units, 400K SF of retail, 400 hotel rooms and an additional 400K SF of offices. GID officials said they expect to break ground on the project by the end of this year.
While congestion remains a concern among companies in Central Perimeter, Heagy said the Georgia Department of Transportation's Georgia 400/Interstate 285 interchange improvements, and a new Abernathy Road diverging diamond interchange, may open the floodgates of demand once they are complete.