Business Chronicle-“Demand for loft offices grows in Brookhaven, Chamblee”-3/22/16

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by Doug Sams
March 22, 2016

 

As more developers transform aging warehouses and abandoned industrial properties along Peachtree just north of Buckhead, they may be taking a little gleam off all those glass office towers.

 

That’s probably a bit of a stretch considering how strong Buckhead’s office district has been performing over the past two years.

 

In Brookhaven, Stream Realty plans to break ground later this spring on a nearly 70,000-square-foot redevelopment of the former Bagcraft Papercorn warehouse on Apple Valley Road.

 

In Brookhaven, Stream Realty plans to break ground later this spring on a nearly… more

 

Even so, developers behind those new projects have an angle.

 

“A lot of people don’t feel like driving 15 to 20 minutes into Buckhead to deal with paid parking or all those parking decks,” says JR Connolly of Connolly Investment & Development.

 

Connolly was speaking this past week during a developer’s forum in Chamblee, where new projects are sprouting along Peachtree Road and MARTA’s Gold Line.

 

The area along MARTA just north of Atlanta contains a fraction of Buckhead’s 19 million-square feet of office buildings, which are filled with some of the city’s largest global commercial real estate companies and financial services firms.

 

Several of those towers also command the highest rents in Atlanta.

 

In the past two years, Buckhead has regained its place as one of the hottest office markets in the Southeast, with investors scooping up some towers for at least $340 a foot.

 

Even so, loft office development is blossoming in less urban areas just outside of Buckhead’s central commercial district. Those areas feature similar access to MARTA rail but also less expensive and bigger tracts of land.

 

The new development reflects a desire for alternatives to high-rise office towers. The projects also appeal to companies eying escapes from the increasingly traffic-choked afternoon commute through Atlanta.

 

It’s also possible some developers with projects on the fringe of Buckhead are playing the “affordability” card against a few landlords, who’ve been pushing office rents to $40 a foot.

 

In Chamblee, much of the new construction near MARTA is for apartments and retail anchors such as Whole Foods.

 

But, a joint venture between Pattillo and Atlanta developer Parkside Partners Inc. have a four-story, 50,000-square-foot project, a transit-oriented project by the Chamblee MARTA station.

 

Pattillo would be the anchor tenant.

 

In Brookhaven, Stream Realty plans to break ground later this spring on a nearly 70,000-square-foot redevelopment of the former Bagcraft Papercorn warehouse on Apple Valley Road.

 

Perkins + Will is the architect of the loft office project. The 3-acre site is a short walk to the Brookhaven Oglethorpe MARTA station.

 

Connolly’s Parkview on Peachtree features hundreds of apartments over street-level retail and restaurants, along with 14,000 square feet of loft offices. It’s also walking distance to MARTA.

 

“We’ve been a little surprised by the demand,” Connolly said.