Another legacy Peachtree Corners suburban office building is set to be razed to make way for townhomes.

Forestar Group purchased 3585 Engineering Drive, a 102K SF, four-story office building in the Technology Park/Atlanta campus. The company, which is majority owned by homebuilding giant D.R. Horton, is one of the largest homesite developers in the U.S. It bought the building about 20 miles north of Downtown Atlanta from an affiliate of Durham, North Carolina-based Dilweg Cos. for $7.5M, according to the Reonomy database.

In turn, Forestar plans to raze the building and partner with D.R. Horton to build 75 upscale townhomes on the 9.3-acre site nestled between Peachtree Parkway and Spalding Drive in Peachtree Corners.

Stream Realty Partners Managing Director Bryan Heller represented Dilweg in the sale after marketing the office space in the building for lease for years and not finding a tenant since the pandemic, he said.

“We’re pleased with the pricing,” Heller said. “We were always leasing the building, but we convinced the owners to take a look at, ‘Well, maybe this is a good site for townhomes.’”

Dilweg received approval for a residential rezoning in March, Heller said. Heller is also listing a 3.5-acre site adjacent to the Forestar property, now used as a parking lot, to potential retail developers, he said.

This is the second time a developer has looked to scrap an office building in the area to make way for housing. Alliance Residential tore down a mid-rise office building off Peachtree Parkway across from Technology Park to build the 295-unit Broadstone Peachtree Corners apartment complex that opened earlier this year.

But at least one other developer encountered local pushback when it tried to tear down an office building for apartments.

Pine Grove Communities applied in March to rezone 7 acres along Peachtree Corners Circle and tear down a three-story office building and replace it with apartments over retail. The following month, the Peachtree Corners City Council enacted a six-month moratorium to halt applications seeking mixed-use developments in the city's business district.

Pine Grove revised its plan, adding a public park to the development that called for 250 apartments, but the city council rejected its proposal in June.