Atlanta Restaurant Real Estate
This Week on The Street (A more or less regular compilation of news, factoids and observations.
by Harold Shumacher
September 1, 2016
Author Thomas Wolfe’s novel “You Can’t Go Home Again” came to mind earlier this month with a visit to Muskegon, an aging, down-on-its-heels Rust Belt City in Western Michigan, for a high school reunion.
In a nutshell, let’s just say that we’re grateful for the circumstances that brought us to Atlanta and the chance to do what little growing up that has occurred to date having taking place here.
At first blush it might be hard to understand Muskegon’s woes. It’s located on Lake Michigan and features a deep harbor along with three beaches, two with camping facilities. There is a decent sized population (175,000) but the local industries, mainly supporting the car industry are long gone and the downtown is decimated, the most significant buildings dedicated to government services (post office, welfare and board of education) and a scant handful of restaurants and bars. Surprisingly the surrounding area, especially north and south of the city seems to be comfortable, if not thriving by relative comparison.
Sometimes living here it’s easy to forget about how large sections of the country are still suffering economic woes. Not so in Atlanta, at least these days, and especially in the in-town neighborhoods. Multi family development is maintaining its stellar pace with another 7,500 units in the pipeline over the next three years (assuming all the announced projects come to fruition.) Even if some fall by the wayside, as some likely will, new employment figures-upwards of 60,000 jobs this year, are strong market drivers. But there is some disturbing trends underneath this enthusiasm. Same store sales, applied to apartment rentals, show little or no growth, according to Haddow & Company, who tracks multi-family development. In fact, while average rental rates are up-mainly due to new construction checking in at a hefty $2.25-$2.50/sq. ft. per month- most developers are seeing flat rental rates and anticipate continuing to do so.
Another troubling development, according to accountant Bob Wagner, who does a quarterly restaurant analysis based on over 100 local restaurants’ monthly sales is the slowest July, in terms of year to year comp sales in the past six years. Third quarter results are yet to be released but many local operators are having nervous moments as they watch the growing number of new seats either opening or about to open signaling even more competition. The hardest hit white tablecloth, upper scale restaurants. The winners fast casual, ethnic spots and fast food.
This has been a busy month for networking, panel presentations and general catch up on activity in Atlanta. What are some takeaways?
The long awaited, and frequently acclaimed “renaissance” of downtown Atlanta may finally be underway. Take a drive, or preferably a walk through the south side of downtown, along historic Mitchell or Forsyth streets. Scattered among the aging building facades are glimpses of what can be, refurbished, freshly painted buildings, quirky retailers and funky galleries. Centennial Olympic Park, the city’s greatest legacy from the 1996 games, is abuzz with activity, especially with the announcement of Jimmy Buffet’s Margaritaville, adjacent to the ferris wheel, and the soon-to-start park refurbishment that will create more green space and room for public gatherings.
Midtown, formally labeled the “arts district” is fast becoming silicon valley south and is better known for the growing number of high paying tech jobs, much of the activity driven by Georgia Tech. The “stitch” a bodacious plan to cover the expressway, roughly from the edge of downtown to just south of the Varsity and create public space, and new development opportunities, is another indication of Atlanta beginning to “think big” again.
Add to that the next phase of the Beltline, slated to open in the southwest quadrant of the city, planned expansion of the Streetcar, the Bellwood Quarry, Atlanta’s largest public park and all of a sudden the long awaited “connectivity” becomes a bit more realistic.
As I like to say “when Atlanta gets done building it’ll be a heck of a place.”
Recent recent activity for the Shumacher Group includes
Golden Corral –Purchase of 2.7 acres located at 2201 Cobb Parkway Marietta, Georgia.
Sale of 3050 Powers Ferry Rd. (the former Houston’s Restaurant) to a private investment group. Kathy Thirolff, Peter Kruskamp and Harold Shumacher represented the Seller, 3050 Windy Hill Road Investors, LLC.
Purchase of Bruster’s Ice Cream land and building located at 3795 Due West Road by the current operator. Steven Josovitz, represented the Seller.
Babalu Tapas and Tacos, lease of 5200 sq. ft. 33 Peachtree Place-Midtown. Harold Shumacher Represented the Tenant.
Papi’s Cuban and Caribbean Grill – Lease of the Former Bone Fish Grill Emory Point Shopping Center (Clifton Rd.) 4300 sq. ft. Harold Shumacher Represented the Tenant.
Purchase of Four Smash Burger Restaurants Metro Atlanta-Steven Josovitz represented the Seller.
Lease of 1401 Johnson Ferry Rd, Marietta, GA (the former Chequers) by Sage Wood Fire Grill. Irving Jacobson, represented the Tenant.