ATLANTA (Feb. 12, 2009) - ULI's Emerging Trends says "a bloodbath is coming" to the Buckhead office market because of overbuilding. Even developers of spec office towers in Buckhead recently questioned Crescent Resources' decision to start one of its own.
But someone who's been around Buckhead for as long as he can remember urged calm in today's real estate-initiated economic storm. Former Atlanta Mayor (and unofficial Buckhead "Mayor") Sam Massell told the Buckhead Business Association today that the 2 million square feet of speculative office space being delivered in Atlanta's toniest district is a good thing.
"We can't absorb all of this overnight," he said of the space. But, "Buckhead will be in the enviable position of having an ample supply when the demand does come back." And as a former developer himself, Massell knows the real estate market and demand always come back.
Massell offered his assessment of Buckhead in his "State of Buckhead" address before a packed house at the City Club of Buckhead in Atlanta Financial Center. During his speech, Massell also defended The Streets of Buckhead, which he said, "faces a new rumor [of its failure] every day."
"Like the Energized bunny, [the Streets of Buckhead] keeps going along at a good pace," he said. "[Developer Ben] Carter has the experience and creativity to do something of this magnitude."
As for Buckhead overall, Massell, who serves as president of the Buckhead Coalition, said Buckhead is well positioned when the economy does rebound because "the luxury market will be the first to turn around."
He also said the city of Atlanta needs Buckhead. While the community's 72,000 residents account for only 15 percent of Atlanta's population, they pay a whopping 45 percent of the city's ad valorem taxes. (As a Buckhead resident, I can confirm this.)
Buckhead "perhaps is the life vest that keeps [the city of Atlanta] afloat in this economy," Massell said. But Buckhead needs to be part of the city, too, he said. The talk of Buckhead splitting apart from Atlanta and forming its own city needs to stop, the former mayor said.
"It is an idea that has no measurable chance of passing legally or politically," Massell said.