Owners of a Mercedes-Benz dealership are driving off of a prime Buckhead location to make room for a high-end hotel.
Instead, they’ll be parking their shiny new cars at a redevelopment site along Piedmont Road in Buckhead.
Easlan Capital purchased the Miami Heights Market Center — formerly home to The Home Depot Inc. (NYSE: HD) store — and almost 8 acres of land for a redevelopment that will house Mercedes-Benz of Buckhead LLC, the high-end dealership owned by Baranco Automotive Group and co-owned by former Atlanta Mayor Andrew Young.
Miami Heights Market Center is an 80,000-square-foot shopping center that currently houses both a Beverly Hall Inc. furniture store and an MCI Inc. data center, both of which take up half of the building, said David Branch, senior director at Advantis/GVA in Atlanta. Branch brokered the deal with Jay Jacob of Easlan.
Easlan purchased the center and property from Texas-based investment group Clearview Investments, Branch said, for $15 million. Clearview purchased the center in 2000 for $11.5 million, according to Atlanta real estate tracking firm Databank Inc.
Kent Levenson, president of Easlan, said the move — placing Baranco’s Mercedes dealership at the Miami Heights site — was done to free up the 2-acre site on West Paces Ferry Road in Buckhead — behind the Buckhead Plaza office tower — for a future high-end hotel and condominium project.
Levenson and Atlanta investors John Meshad and George Berkow are developing that project, one that will include 150 hotel rooms and 45 condominium units in 450,000 square feet, Levenson said. The developers are believed to be negotiating with St. Regis, the luxury brand owned by Starwood Hotels & Resorts Worldwide Inc. (NYSE: HOT), to operate the hotel.
“For us, it was trying to relocate the dealership off the Buckhead Plaza property,” Levenson said. “Hopefully, it will be the long-term home of Mercedes-Benz of Buckhead. If you want to be in Buckhead, I can’t think of anyplace else to put them.”
Branch was hired by the former owner to market the Miami Heights property three years ago. Originally the shopping center itself was renovated to accommodate telecommunication hotels, and that eventually led to the MCI lease. But with the bust in the telecom industry, the rest of the center remained empty of prospects, Branch said.
“We took it to market to what we thought was an unbelievable land play with income,” Branch said. MCI has seven years left on its lease, but has three five-year renewal options. And Beverly Hall signed a 10-year lease for its Miami Heights store. Baranco signed a 10-year lease as well, officials said.
This is Easlan’s latest Buckhead land investment. Besides Berkow, Levenson and Meshad’s plans for the hotel — which is independent of Easlan — the group co-owns the City Center site, a 12.5-acre tract wrapping around the Grand Hyatt Atlanta hotel at Piedmont and Peachtree roads. The land’s co-owners — Pope & Land Enterprises Inc. — plan to eventually develop a 37-story, 750,000-square-foot office and condominium tower.
Most recently, Easlan repurchased a portion of property it sold to residential developer Wood Partners LLC earlier this year with plans to develop a 32,000-square-foot office and retail building, Levenson said.
Keeping Buckhead presence
For Baranco, the deal allows the owners to keep a Buckhead address.
“There are major opportunities … in the Buckhead area,” said Gregory Baranco, co-owner of the dealership. Baranco was awarded the Mercedes-Benz franchise for the Buckhead area in June of 2003.
Baranco said the company plans a three-story dealership with up to 80 automotive service bays. And the current dealership sells an average of 100 vehicles a month at its West Paces Ferry location, Baranco said.
But Cathy Ellis, owner of Atlanta Classic Cars Inc., said the intown market proved increasingly difficult to grow business in, given the lack of land to expand upon.
Atlanta Classic Cars moved in 2002 from its Decatur neighborhood (on Church Street) to newer — and larger — pastures on Boggs Road off Ga. 316. Ellis now operates her dealership on 19.5 acres.
“It’s almost impossible to find a 19-acre tract in Buckhead. They’re going to end up with less space than I had in Decatur,” she said. “There’s not a lot of car dealers there. Mainly because … you’d need so much space.”
Credit/Original Post: https://www.bizjournals.com/atlanta/stories/2004/07/05/story6.html