Capital Development Partners proposal could bring 300-400 jobs to community

Atlanta developer eyes $140M-plus business park off Cass-White Road

By JAMES SWIFT
Posted 3/10/19

Ears pricked up Monday when Atlanta-based Capital Development Partners submitted a Development of Regional Impact (DRI) application to the Georgia Department of Community Affairs. Such an application …

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Capital Development Partners proposal could bring 300-400 jobs to community

Atlanta developer eyes $140M-plus business park off Cass-White Road

Posted

Ears pricked up Monday when Atlanta-based Capital Development Partners submitted a Development of Regional Impact (DRI) application to the Georgia Department of Community Affairs. Such an application is required by the State for any proposed wholesale and distribution development larger than 500,000 square feet in the metro area.

According to information submitted by Wolverton and Associates representative Jeffrey Hodgkinson, the same developer behind the $125 million Savannah Logistics Center is interested in constructing a new business park on approximately 260 acres in White. 

Per Hodgkinson’s documents, the proposed I-75 North Logistics Center would include at least three buildings, combining for a roughly 2.75 million-square-foot “distribution and logistics center” footprint.

It was unexpected news for Bartow County Commissioner Steve Taylor, who said he didn’t even speak to representatives from Capital Development Partners about the proposed project until Wednesday.

“We just had a chat about them buying the property, and they have actually optioned the property and have it under contract, but it has not been purchased yet,” Taylor said. “So they’ve got a ways to go before this actually gets underway.”

Capital Development Partners CEO John Knox Porter said the proposed development would be very similar to its Savannah Logistics Center project.

“The Appalachian Port was just opened up recently and you’ll see the CSX rail line goes by our site, so we think there is a large demand for customers on the north side of Atlanta that would need the type of space that we build and develop," Porter said. "We work with manufacturing companies and companies that support manufacturing companies around the country with projects like this.” 

The property where the I-75 North Logistics Center would be located is currently owned by Ronkonkoma, New York-based Galco Investment III. Today, the parcel more or less serves as a divider between the Highland 75 industrial park and Cass High School.

“It’s off Cass-White Road on Great Valley Parkway, and it’s on the end of the parkway on the east side of Great Valley,” Taylor said. “It actually joins Highland 75 … that’s been the long-range plan from the start, to bring this particular piece of property, which is about 260 acres, adjoining 75 to bring that in to have the same business park-type industries as Highland 75 has.”

If the project comes to fruition, Taylor said Capital Development Partners’ project would tie “seamlessly” into the existing Highland 75 infrastructure. “You won’t know what’s part of Highland 75 versus this business park,” he said. “They will blend right together.”

While the proposed business park may abut the City of Cartersville and Bartow County-owned Highland 75 park, Taylor said neither municipal government, nor any of its related authorities, would serve as landlords for the logistics center.

“This is not a property that we own, this is a property that would be owned by private investors that have come to Bartow County,” Taylor said. “The ball is in their court, in other words, in terms of the time and how fast they want to move. We don’t have any restrictions or expectations from the company as far as moving forward in any particular date or goal for a date out there. So it’s totally up to the private company how fast they want to move on this project.”

From his discussions with Capital Development Partners, Taylor said the company is in “the phase of doing due diligence and trying to make sure this project works.” Although Taylor said he believes the developer may have filed the DRI a little early, he nonetheless believes it’s an indication that “they are actually going to take down this property and purchase it.”

According to the DRI application, the estimated completion date for the “overall project” is listed as summer 2020.

However, Taylor said that particular timeline isn’t just ambitious, it’s almost impossible.

“That is probably a stretch to get anything started by summer 2020, much less any completion of anything by then,” he said. 

Porter acknowledged that the total project would not be completed by 2020. However, he said he does expect substantial progress to be made on the development by that time.

“We’ll probably complete our first building by then,” he said. “We’ve got a three-building, phased approach … we’ll probably end up closing by the early summer on the land, and then we would start construction on our infrastructure on the first building. And that’s actually fairly conservative, it only takes me eight months, typically, to build these buildings.”

At this point, Taylor said he is not aware of any companies that may be interested in becoming tenants at the new park. Nor did Taylor say that the County offered the developer any business incentives to “lure” them to the park.

However, he did say it was certainly possible that the developer could receive future abatements to get construction on the project started.

“We don’t give subsidies to anyone, but we do give tax abatements on the County side,” Taylor said. "But remember, we don’t abate school taxes, so as far as County government abatements, we do pass on tax abatements to certain industries if they meet our criteria, which is jobs, average wages have to be high and the total investment that they’re bringing to this community.”

Porter confirmed that the developer has not had any discussions with the County regarding incentives.

"What we have discussed is how our company can be a partner with the local government, as well as local businesses,”  Porter said. “The I-75 north market is really underserved with the type of product that we do."

At this juncture, Taylor said he has no idea what the size of the potential economic investment in the community may be.

“I think we’re a little premature on commenting very much on this until they get the property purchased, and then they bring a proposal to the County and lay out exactly what they want to do,” Taylor said.

Porter estimated that it would take about $140-$150 million to construct the three proposed buildings. And with that investment, he said, would come exactly the kind of wages the County is looking for.

“I think it will create between 300 and 400 jobs,” he said. “And typically, these jobs for these types of users, the median salary is $65,000, plus benefits.”

As for potential tenants, Porter said he does have some customers in mind for the project.

"Most of our development efforts are driven by our customers," he said. "The cycle time for our customers to occupy buildings is much less than it used to be, so every building that we're developing, before we get the roof on it, typically it is leased." 

Porter said he anticipates some "lag time" between the start of construction and leasing on the proposed Bartow development, but not much. 

“Some of our buildings are speculative to meet the demand in the market, and some of them are built to suit for the customers, specifically," he said. "The majority of what we do now is speculative, which is typically leased out in short order.”

While Taylor said it’s too early to tell how the proposed project turns out, he said no rezonings would be required for the development to take shape. And being in such close proximity to Highland 75, Taylor said the proposed development wouldn’t have to worry about water, sewer or road infrastructure.

“We’re a pro-business community, and I think industrial investors around the state are starting to take notice of that, and they know that we’re a community that has a low cost of doing business,” Taylor said.

Porter said he expects the development to take two to three years for full build-out. “I think it takes us out to 2023," he said.

While projects of the like may be somewhat uncommon above the  perimeter, Porter said he expects to see more major developments emerge in northwest Georgia in the years ahead.

“When you look at the landscape at what’s happened in metro Atlanta, you see a lot of development that’s happened south, but you’re seeing the south markets have labor issues as well as a whole lot of traffic issues," he said. "Because of the lack of availability of land in the I-75 corridor, this was really a gem to be able to bring this to the marketplace, and the main reason is because it’s got such good access to a major highway and it’s got access to a fantastic labor market."

Although the project may be years away from completion, Taylor said it would unquestionably be a major financial boon to the community when it comes online.

“As these companies come into Bartow and build out and hire people, I think all this does is extend the pipeline out for future hiring and future growth,” he said. “And we’re doing it in such a way that it’s not explosive growth and it’s not more than we can manage. So I think it’s going to have a positive economic impact for the county, and I think you’ll continue to see wage growth because of these types of projects coming to Bartow.”

Porter said he shared that sentiment.

"I just think you’re going to see Bartow County attract a lot of industry — and high-level industry — because of the fundamentals that Bartow County has right now compared to other counties," he said.

By mid-year, Porter said he expects to have the DRI process finished, the land acquisition completed and horizontal development underway.

“We’ll start major construction by early summer, and usually it takes three to four months for grading and pad sites,” he said. “We’ll probably be pouring footers sometime in the fall.”