Atlanta to purchase office tower from GA state government for $39 million
The Atlanta It will spend $39 million to purchase a 41-story downtown office tower from the Georgia state government, saying the city will redevelop the old building to include mixed-income housing and other uses.
The state has owned 2 Peachtree Street for about 30 years. It was the tallest building in Atlanta when it was built in 1968 for the First National Bank in Atlanta, which eventually became part of the Wells Fargo & Company.
The state emptied the tower of government tenants, and moved some of them to vacant offices around the capital building. Some state agencies have been downsized after they concluded during the coronavirus pandemic that working remotely meant they needed less office space.
The state allocated $45 million earlier this year for the transition of 2 Peachtree. House Appropriations Committee Chairman Terry England said at the time that renovating the building would cost more than it was worth. Georgia spent more than $100 million on an earlier round of renovations.
Dickens said the location is excellent for affordable housing because it is next to the Five Points rail station of the Metropolitan Atlanta Rapid Transit Authority. Residences will rise even higher, he said, with offices, shops and restaurants on the lower floors, and that the redevelopment “will bring us closer to our vision of a world-class downtown area.”
The sale comes as part of the downtown Atlanta office market struggle. Lenders have recovered much of the Peachtree Center office complex in a foreclosure auction in September. In 2021, real estate firm Jones Lang LaSalle reported that users vacated 600,000 square feet of office space more than they moved in. The trend during the first nine months of this year is rather positive.
German company Newport Re is redeveloping a number of buildings in the southern part of the city centre. Los Angeles Real estate investor CIM Group plans to spend $5 billion on office buildings, apartments, a hotel and restaurants on a railroad and parking lots near the Mercedes-Benz stadium.
Dickens said in a press release that city agency Invest Atlanta will be seeking a private developer for 2 Peachtree. The mayor said the city’s money would create “customized and very affordable housing.” Dickens said several hundred new housing units will be built overall, calling it a “huge leap forward” toward his goal of creating or maintaining 20,000 affordable housing units by 2030. The city says 5,800 units are either completed or underway. reconstructed.
The purchase money will come from a special tax district that includes parts of downtown.