The retail market in Atlanta is sporting a fresh new look thanks to favorable economic factors and a wave of developments and redevelopments coming online or recently announced. BuckheadAtlanta, Avalon and Ponce City Market are among the new retail-infused properties, while multiple proposed locations for Whole Foods Market, combined with the advent ofmajor mixed-use projects in the Decatur area, exemplify the shape of retail to come.
“We are creating a ‘new normal,’” saidMark Toro, managing partner at North American Properties,which lists Avalon and Atlantic Station among its high profile holdings. “What we knew as ‘normal’five years ago, in terms ofclassic, ground-up, suburbanpower centers, may never return.”
In the last couple of decades, Toro explained, retail developerswere focused on convenience. Thestandard model called for one ormore category or lifestyle leaders as an anchor along withconvenient parking, whichallowed the consumer toget in and out of the center with a minimum ofhassle.
“It was all about facilitating a transaction; now it’s about anexperience,” Toro said. The “new normal” calls for encouraging the consumer to spendmore time and, theoretically,money on site. High quality food and beverage options, sometimes relying on a locally renownedchef to provide a draw, have become critically important to new retail centers.
At Avalon, the $600 million, 2.3-million-square-foot developmentlocated on 86acres at theintersection of Georgia 400, Old Milton Parkway and Westside Parkway in Alpharetta, tenantsinclude more than 60 restaurants and retailers (not includinga major department store), 250luxury apartments, 101 single-family units, and loft-style office spaces.
“The notion that retailfollows rooftops is alive and well, but now it’sone rooftop housing three hundred households,” Toro said.
In Decatur, Fuqua Development LP recently passed one of the last bureaucratic hurdles before breaking ground on a project that will include apartments and retail on about 13.5 acres along Scott Boulevard. While Fuqua awaits a final vote by the DeKalb County Commission, plans call for delivering the first of 450 apartments and 95,000 square feet of retail by early 2017. The company is already poised to redevelop about six acres at the intersection of Scott Boulevard and North Decatur Road. Construction of 250 apartments and about 8,000 square feet of retail in scheduled to begin in June with delivery of the first units to begin within 14 months.
“We like the market today,” saidJeff Fuqua, principal at Fuqua Development. “There are a lot fewer players, the entry barrier is higher, and it’s a more complicated and difficult formula today.”
Currently, Fuqua is involved with almost a dozen developments across the metro area including a mixed-use project adjacent to the new SunTrust Park, future home of the Atlanta Braves, in Cobb County, a regional mixed use project at Highway 41 and Barrett Parkway in Kennesaw, Glenwood Place in Grant Park, Lindberg Place in Buckhead, and Sugarloaf Marketplace in Duluth.
“Including ours, I’m not sure Atlanta has ever had as many major projects occurring at one time,” Fuqua said.
Smaller developments are shapingthe contour of Atlanta’s retail landscape. Krog Street Market, located in the Inman Park neighborhood, comprises about 30,000 square feet of retail space near the Atlanta Beltline.
“The market is looking for a different kind of retail,” said Ray Uttenhove, executive vice president and market leader at SRS Real Estate Partners, which handles the Krog Street Market property. “I also think we learned a lesson from the recession about over-building. Lenders and developers are much more keenly focused on projects where there is significant market demand.”