The wrecking ball is coming for the Atlanta Medical Center. The Integral Group hired a contractor to tear down the Atlanta Medical Center. Integral and Wellstar Health System, the building owners, planning to replace the shuttered hospital with a mixed-use community that includes housing, retail, and health facilities. Ferma Corp. is leading the demolition team. The job is expected to take most of 2025. The development team will present its detailed plans once the space has been flattened.

The city worked with engineering firm Kimley-Horn to determine the highest and best use for the property. Their conceptual plan called for more than 2 million square feet of housing, along with several hundred thousand square feet of retail and other commercial uses.

Wellstar closed Atlanta Medical Center in November 2022. Wellstar leaders said the hospital system was forced to close because falling revenue and increasing costs put its finances at risk.

Vestar will break ground net week on its massive shopping center in Buckeye, which will feature a Harkins BackLot, a Target, a Safeway and more. The Verrado Marketplace will feature shops, dining, grocery, entertainment and services across 520,000 square feet. Vestar is expected to invest $300 million into the project including all tenant improvements. Other tenants that have been announced for the Verrado Marketplace include Marshalls, Ross and HomeGoods.

Vestar also plans to unveil names of 15 additional national and local retailers that are expected to be part of the retail center at the northeast corner of Interstate 10 and Verrado Way.

The Phoenix Business Journal reports the city of Buckeye is working on designating 2,100 acres just south of Verrado Marketplace into a mixed-use center with various uses, such as retail, entertainment, housing, education and more. Another 600,000 square feet of retail is underway south of I-10 at Verrado Way across three major projects, including the 411,000-square-foot Buckeye Commons and the 100,000-square-foot Roosevelt Commons.

Ray and VeLa are again combining on a multifamily community, this one in Nashville. The 32-story, 367-unit Ray Nashville project will be valued at $211 million.  Construction financing for Ray Nashville was provided by J.P. Morgan and Monroe Capital and arranged by Walker & Dunlop. Ray Nashville is designed by architectural firm Johnston Marklee & Associates in partnership with Lamar Johnson Collaborative. Layton is the contractor.

Located in the Pie Town neighborhood at 601 Lafayette Street, the 32-story tower will encompass 575,000 square feet of developed space. Units will range from studios to three bedrooms. Amenities will include an indoor-outdoor fitness center, yoga studio, spa, lounge, outdoor pool, dog wash stations, coworking spaces and public and private parking. The project will include 4,700 square feet of retail and a public gallery on the ground floor that will showcase pieces from Nashville-based artists. Estimated completion is 2027.  The two firms recently broke ground on Ray Phoenix in Arizona.

The largest economic development project in Georgia’s history will open sooner than anticipated. The official production start for Hyundai Motor Group Metaplant America near Savannah is scheduled for the fourth quarter of 2024 instead of the previously projected start in the first half of 2025.

The plant will be the first EV mass-production plant for Hyundai and will produce Hyundai, Genesis and Kia cars. Hyundai’s investment for the Metaplant is about $7.59 billion and will create 8,500 jobs. LG Energy Solution is the partner that will create the battery components.

This plant has also attracted multiple suppliers to Georgia, such as car part and frame manufacturer Hwashin and Daechang Seat Corp. Outside of Hyundai, the state will also be home to Rivian Automotive Inc.’s plant in Stanton Springs, which will create about 7,500 jobs.

The Dream Hotel developer says a demolition permit is needed and it has not been approved by the health department. Construction cannot begin without that approval. The hotel is to be built on top of the former Royal Furniture Store on South Main. The project is expected to cost $99 million.

The developer, 18 Main, is now asking that the building permit be pushed back to September of 2024 to give them time to get the permit. The Dream Hotel is currently listed as a pending case before the Land Use Control Board. A public notice has been sent out to nearby residents, and signage is posted at the project site. The decision will be made later this week.

Details show the new 11-story hotel will feature seven levels of hotel rooms, three floors of apartments, and ground floor restaurant and bar space. Dream Hotels is now a Hyatt brand.

Courtesy of Chicago Neighborhood Initiatives

Pullman Crossings

A deadline is approaching for investors that want to pour capital gains into federal opportunity zones, and a rush could be on.

As of Jan, 1, investments into qualified opportunity zone funds won’t receive the 10% reduction on deferred capital gains taxes that has been part of the program since it was created by the 2017 Tax Cuts and Jobs Act.  

Those who act after Dec. 31 can still secure two other benefits from the program, which, according to its congressional sponsors, was meant to drive investment into neighborhoods historically starved for capital. Future investors can still defer their capital gains tax liability until Dec. 31, 2026, as well as eliminate taxes on any capital gains realized from an opportunity zone investment after 10 years.

Those two benefits are each more valuable to investors than the 10% reduction on deferred capital gains taxes that will sunset in less than four weeks, according to Origin Investments Co-CEO David Scherer. But the loss of that reduction is still causing a new rush of investors seeking to take advantage of opportunity zones.  

“It’s a better idea to do this in December rather than in January because why not get the 10%?” Scherer said.

Origin closed its first qualified opportunity zone fund in July after raising $265M from more than 800 investors, he said. These dollars can flow into most kinds of developments, properties and businesses within the nation’s 8,700 opportunity zones, but Origin concentrates on multifamily developments. Its first fund has about 3,700 units under construction in 11 multifamily properties, with a total value of more than $846M.

The firm launched its second qualified opportunity zone fund in October. It has six multifamily assets in its pipeline, including projects in the Atlanta, Phoenix, Charlotte and Colorado Springs markets.

It is typical that Q4 is the busiest for firms running qualified opportunity zone funds, Scherer said, but based on activity over the past few weeks, this year could be the busiest.

“I can’t give you an exact number, but we’re already seeing it, and we’re pretty confident we’ll have a record December,” he added.

Opportunity zone funds have become more popular with investors. In the first half of 2021, qualified funds raised more than $17.5B, a 15.5% boost over the total reported for all of 2020, according to a study by Novogradac, a public accounting firm.

The program has its critics, who say opportunity zones provide tax breaks for wealthy investors and promote development in areas that aren’t really struggling.

That isn’t true, at least in Illinois, according to Jennifer Bransfield, chief operating officer of Chicago Neighborhood Initiatives, a nonprofit developer that does a lot of work in the Far South Side neighborhood of Pullman. She credits state and city officials for making sure opportunity zones in Illinois covered the neighborhoods, including Pullman, that needed the most help.

“It’s an important tool that helps finance projects that traditional developers will overlook because they don’t pencil out with traditional forms of capital,” she said.

Opportunity zone investors provided all the funding for the $35M, 400K SF industrial building that CNI developed in Pullman Crossings, a 62-acre industrial park. The project was finished two years ago and is now fully occupied by manufacturer SC Johnson.

“Having the OZ financing meant we were able to develop the project very swiftly, just nine months, and deliver 200 new jobs to the neighborhood,” Bransfield said.