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Famed developer eyes overhaul of Ford plant
by Rachel Tobin Ramos and Douglas Sams Staff Writers
Atlanta Business Chronicle
Published on: 11/23/07
The now lifeless Ford plant in Hapeville could be the engine of a Southside renaissance.
The 127-acre Ford property is under contract with Jim Jacoby, the Atlanta developer of Atlantic Station. Jacoby plans to create a mixed-use development that could include offices, retail and at least one hotel (but probably not housing), according to a source familiar with the deal.
The Ford site -- just feet from Atlanta's airport -- could be one of the most significant projects developed on Atlanta's Southside in the past decade. It could have a spin-off effect, spurring new commercial investment in an area better known for industrial sites.
It could provide some of the newest office space for aviation and logistics companies that the Hartsfield-Jackson Atlanta International Airport area has seen in years. And, it would be the first retail experiment of its kind in that market.
Still, the development may face significant challenges, including building restrictions because of its proximity to the airport.
The plant, which used to produce Ford Taurus cars, closed in October 2006.
Since then, Ford Motor Co. (NYSE: F) has marketed the land for sale through its Ford Motor Land Development Corp., the real estate division of the Dearborn, Mich.-based "big three" automaker.
Jacoby, chairman of Jacoby Development, could build offices, retail space and at least one hotel on the Ford site, according to the source, who has been a prominent real estate investor near the airport for decades.
Jacoby wouldn't comment.
Jacoby is known for buying Midtown's Atlantic Steel site for $97 million in 1997 and turning it into a mixed-use development with condos, a Dillard's, boutique retailers, restaurants, a Publix, a Target and a movie theater, plus the city's first IKEA outpost.
Chris Montesinos, Hapeville's planning and zoning manager, confirmed on Nov. 20 that "Ford has selected a developer for the site," but he said Hapeville is "under a confidentiality agreement not to disclose their identity."
Montesinos said the "property will be developed for mixed-use in accordance with the zoning," but there will be "no residential component."
The site, however, could have an up-to-15-story building, said Montesinos, and a hotel isn't being ruled out. But, the site is just feet from Hartsfield-Jackson Atlanta International Airport's north runways, off of North Inner Loop Road, and there are some restrictions on building height due flight patterns.
The Ford plant had a waiver from airport authorities to operate so close to the runway, because it was there since 1947, before the modern airport was built.
Montesinos said that the new developers will inherit the grandfathered waiver, and won't have to abide by newer, stricter restrictions for off-airport development.
Developments near runways usually are subject to tight restrictions on height and distance. While residential projects near airports are difficult because of federal noise abatement rules, hotels can be sound-proofed
Still, Montesinos said he has yet to see the specific plans, and is waiting to see the final project that Ford has picked.
At least three developers were interested in the Hapeville site, he said.
Anxious for redevelopment
The Ford land is in the city of Hapeville and Fulton and Clayton counties.
But the people who cared the most about the plant's future -- Hapeville's city officials -- have had to wait for Ford to sell the land to see what would become of it, said Mike Rast, Hapeville's city administrator and economic development director.
He said Hapeville has had no control over the direction the site would take, aside from redeveloping the property from industrial to "urban village mixed-use" in 2006.
Montesinos added that Hapeville feared the Ford plant would be turned into airport parking. The new zoning designation -- mixed-use -- prevented the land from becoming stand-alone surface parking lots, he said.
The closure of the plant put a huge dent in Hapeville's revenue stream, said Rast. The city lost about $1 million a year in tax dollars, plus its largest water user.
He said the city raised its tax rate by four mills in order to make up the loss.
Hapeville has a population of nearly 6,500, said Rast, with a general fund budget of $10.7 million. The water/sewer/capital improvement fund is $17.1 million.
"We're very anxious to get the property back onto our tax rolls," said Rast. "We've been hurt severely by the closure of the plant."
The Hapeville plant is the third of three properties on Atlanta's Southside that will be redeveloped, the others being Fort McPherson and Lakewood Fairgrounds.
Chick Krautler, director of the Atlanta Regional Commission, said he has seen a gradual shift in economic and population centers to the Southside, after decades of those developments settling more in Atlanta's northern suburbs.
"That is now changing," he said.
The Army's Fort McPherson will be developed into a research park.
And this year, the city of Atlanta sought proposals to redevelop the Lakewood Fairgrounds.
Reach Ramos at rramos@bizjournals.com and Sams at dsams@bizjournals.com.
The content of this article © American City Business Journals Inc. All rights reserved.
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