TIAA Seeks Rezoning for Estimated $100M Mixed-Use Venture at Concourse

According to TIAA's rezoning application filed with the state agency, the planned project is at the northeast corner of Peachtree Dunwoody Road and Hammond Drive within the five-building, 2.1-million-sf, 21-year-old, 33-story Concourse Corporate Center class A office campus that TIAA owns in the 27-million-sf Central Perimeter submarket in suburban Sandy Springs, 10 miles north of Downtown Atlanta. If started in 2006, the project could be completed in 2012, according to TIAA's zoning application.

Cousins Properties Inc. and TIAA officials couldn't be reached by GlobeSt.com's publication deadline to confirm the locally based REIT will develop the undertaking for TIAA. The New York fund retained Cousins in 2000 to lease and manage the Concourse, as GlobeSt.com previously reported.

"It would be logical for TIAA to call on Cousins to handle this development," an area mortgage banker, who is not involved in the project but who is considered a local real estate insider, tells GlobeSt.com. "TIAA has financed numerous Cousins projects in the past and they have a strong professional relationship."

Among the Cousins projects TIAA has financed are the Pinnacle, Two Live Oak, the Avenue East Cobb, Meridian Mark Plaza and Wildwood Plaza. The loans are more than $250 million, Cousins officials have confirmed in previously reported stories by GlobeSt.com.

Area office and industrial brokers intimate with the Central Perimeter submarket and familiar with the Concourse property tell GlobeSt.com TIAA is switching from office to residential-retail development at this time to capture the demand for shelter-retail-related product.

TIAA's five office buildings have an estimated 85% occupancy level with asking base rents in the $23-to-$25-per-sf range, among the highest in the area, brokers who have participated in office deals at the property tell GlobeSt.com. Constructing luxury condos in the $300,000 to $1-million range could prove more profitable for the fund at this time, area brokers and mortgage bankers who have worked with TIAA representatives and affiliates in the past, say.

Metro construction sources familiar with comparable enterprises in other parts of the area and within the state tell GlobeSt.com the hard construction cost of the 650 planned condos would probably be at least $100,000 per unit or an estimated total $65 million. The 70,000-sf, high-class retail component would probably come in at $80 per sf or an estimated total $5.6 million.

"That's only the total hard construction cost estimate at about $70 million," the source tells GlobeSt.com. "The total development cost of such a project could easily top $100 million."