Page 2B • July 27-August 2, 2012 ATLANTA BUSINESS CHRONICLED U N W O O D Y M A R K E T R E P O R T

universities from which to recruit local workers. Final-round candidates included Washington, D.C.; Charlotte, N.C.; Atlanta; and Tampa and Orlando, Fla.

“Once we chose Atlanta, we started focusing on the best locations in the metro area,” Belden said.

Company functions housed under the new space at One Ravinia Drive include sales/revenue management, food and bev-erage, design and construction, legal, human resources and business develop-ment. Some functions, such as accounting and payroll, remain in Memphis.

“Traffic was an issue, so we needed to be relatively accessible to the airport, as we travel frequently,” Belden said. “We also wanted to make sure our employees, both those transferring as well as local hires, would have the best transportation options and access to great schools, as well as other quality-of-life factors.”

Davidson’s corporate office in Memphis is located in a prime business community, Belden said, but access to “anything except work” required an automobile trip.

“In our new location, you can get to

restaurants and shopping and other activi-ties by either walking to Perimeter Mall or taking a shuttle, MARTA or other local transportation options,” Belden said.

Similar accolades and motivations were conveyed by Eric Cooney, president and CEO of Internap Network Services Corp. (Nasdaq: INAP), whose company announced a relocation and expansion from 250 Williams St. in downtown Atlanta to One Ravinia Drive at the end of 2011.

“As we filled towards capacity in the downtown data center, we opted to relo-cate our staff in order to free up space to more than triple the size of our data center footprint,” Cooney said.

When fully deployed, the expansion space will include 80,000 gross square feet, increasing the company’s total Atlanta data center footprint to 120,000 gross square feet. In addition to cutting-edge technical performance and storage capabilities, the new Dunwoody location provides Internap with 62,000 square feet of custom-designed office space to meet its growing business needs.

“The new space allows us to take advantage of all the conveniences the Perimeter district has to offer including close proximity to our customer base in

metro Atlanta, residential suburbs where many of our staff live and a host of shops, restaurants and athletic facilities,” Cooney said.

The move to the Perimeter district has reduced commute times for a majority of the headquarters staff, according to Cooney. He also anticipates the newlocation and facilities will enhance the company’s ability to attract new employees and retain existing staff.

“On both professional and personal levels, the Dunwoody office location has met or exceeded our requirements for the corporate headquarters,” he said.

Dunwoody’s economic development team is moving forward with a portfolio of projects designed to position the sub-market advantageously on the wave of activity rolling through the metro area. In addition to infrastructure developments and smart urban planning, officials are quick to tout the city’s appealing combina-tion of small-town access and big-city accommodations.

“We have 8 million square feet of prime office space and a very small bureaucracy to deal with,” Starling said. “You can almost always get the mayor on the phone, after one or two tries.”

T he leasing market has heated up, office building owners are checking out the prospects of selling their properties for a nice price — and it’s summer in the

Central Perimeter.Largely clustered in Dunwoody, Central

Perimeter offers some extremely attractive buying opportunities for investors on the prowl.

“Low interest rates, combined with the high price/low yield offerings in the gateway markets like New York and Boston, have created a favorable environ-ment for Atlanta office owners, especially those in the best submarkets,” said Gary Lee, managing director and principal at Cassidy Turley.

And these days, Central Perimeter is very much on the list of those “best submarkets.”

“Momentum in the Central Perimeter is very strong,” Lee said. There have been significant leases executed in the sub-market this year, led by the recent 428,000-square-foot State Farm lease at 64 and 66 Perimeter Center East for a cus-tomer service center, he said, “and owners are taking advantage of this opportunity to sell their assets.”

Recent major Central Perimeter office investment action , includes Boston-based Franklin Street Properties Corp. (NYSE: FSP) reaching an agreement to buy the 17-story, 384,000-square-foot One Ravinia from Hines; and Jackson, Miss.-based office real estate investment trust (REIT) Parkway Properties Inc. (NYSE: PKY) purchasing the 438,000-square-foot Two Ravinia from Orlando, Fla.-based Eola Capital LLC last year for $462 million.

Owner TIAA-CREF has put Corporate Center V and VI, the two, 687,000-square-foot, 32-story towers dubbed the “king” and “queen” buildings at the northeast quadrant of the Interstate 285/Georgia 400 interchange, under contract to a venture made up of Atlanta-based Regent Partners LLC and GEM Realty Capital Inc., a Chicago-based private equity firm. Additionally, the two, 500,000-square-foot

plus, 11-story towers at The Terraces have been put on the market by Rubenstein Properties Fund L.P.

It’s hot out there“In terms of leasing, the [Central

Perimeter] submarket is on fire,” said Scott Amoson, vice president and director of research at Colliers International Atlanta.

Examples, according to Amoson, include recent new headquar-ters deals such as those by international pallet and container leasing giant CHEP, which moved its U.S. base to

60,000 square feet leased in Hammond Exchange; the State Farm transaction; a new North American headquarters for Elekta, a Stockholm-based developer of brain cancer treatment devices, for 77,000 square feet at North Terraces; as well as expansions by Dell SecureWorks, Elavon and Ericsson.

The Central Perimeter leasing market has been particularly good this year, according to Lisa Dunavin, senior director

and head of the agency leasing department of Cushman & Wakefield of Georgia Inc.

Among other deals in this market, mem-bers of this team represented building ownership in State Farm’s lease last June, “a deal that represents true absorption when

they move in later this year.” In other deals over the past year or so,

the group also represented Terraces’ ownership in leases by Elekta; Popeyes restaurants franchiser and operatorAFC Enterprises Inc., for a 55,000-square-foot corporate headquarters; and enterprise software/services provider Ventyx, which took 55,000 square feet here for a global headquarters.

“Overall activity in the Central Perimeter has been extremely strong this year, especially compared with some of the other submarkets we are working in,” Dunavin said. The recent spate of deals here, she notes, “confirms what we’ve always known — that as the geographic center of Atlanta, the Central Perimeter

can’t be beaten when it comes to the ability of companies to draw employees.”

As vs. BsAnother factor behind the recent burst

of activity here has been aggressive land-lords with affordable class A space, according to Amoson. The spread in rents between A and B buildings is pretty tight, he said.

“Class A buildings in Central Perimeter are averaging $21.82 per square foot, while class B product is averaging $18.04,” Amoson said. With only about $4 sepa-rating the two classes (compared with a $7 gap in other major submarkets), “com-panies are willing to spend the extra to be in the better building, especially when they can get attractive incentive packages from some of the class A landlords.”

Class A absorption in the Central Perimeter has totaled 676,507 square feet so far this year, according to Amoson, with the Bs weighing in at 76,205 square feet.

The class B market is slowly improving, according to Tom Parker, president of the Office Leasing Group of SK Commercial Realty, owner of Perimeter Crossing at Lake Hearn, and Northridge 400 Office Center.

Class B vacancy has dropped some seven or eight points during

the past 12 months, according to Parker. “The market is reasonably active,” he

said, “but the deals are very competitive, and tenant expectations of getting a lot of concessions when they lease office space are high.”

Stiff competition for tenants and pres-sure on rates notwithstanding, this market is always a good place to own an office building, Parker added.

“Central Perimeter is a perennial winner,” he said. “It has experienced its share of tough times, but it always comes back.”

Central Perimeter has strong second quarterBy Martin SindermanCONTRIBUTING WRITER

Center of attentionContinued from 1B

Eric Cooney: Internap Network Services Corp.’s move to the Perimeter district reduced employee commute times, according to the company’s CEO.

AmosonColliers International

Atlanta

DunavinCushman & Wakefield of Georgia Inc.

ParkerSK Commercial

Realty

Central Perimeter Office MarketYear-end 2010 - Second-Quarter 2012 Class A and Class B Buildings

AVERAGE QUOTED CLASS A

TOTAL SQ.FT. % VACANT YTD ABSORPTION RENTAL RATES

2010 18,998,600 18.7% 24,222 $22.39

2011 18,998,600 19.5% (152,688) $21.72

YTD 2012 19,298,600 17.2% 676,507 $21.82

AVERAGE QUOTED CLASS B

TOTAL SQ.FT. % VACANT YTD ABSORPTION RENTAL RATES

2010 7,832,196 26% (259,491) $17.92

2011 7,832,196 30.1% (372,950) $17.93

YTD 2012 7,848,196 29.9% 76,205 $18.04 Source: Colliers International Atlanta

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Page 4B • July 27-August 2, 2012 ATLANTA BUSINESS CHRONICLED U N W O O D Y M A R K E T R E P O R T

M ike Davis was elected as the second mayor of the city of Dunwoody in December 2011. He has lived with his family in Dunwoody for 22

years, and prior to becoming mayor was president of My Georgia Doctor Inc.

Q: Where is Dunwoody on its comprehensive plan?

A: We adopted our Compre-hensive Land Use Plan

in 2010; [it] serves as a road map and long-range vision of how our residents and stakeholders want to see our community’s overall develop-ment. The community helped designate several areas in the city as “character areas” with specific land use and other character features.

Today we are actively moving forward with the implementation of our master plans, which the city believes will benefi-cially enhance these areas. The Georgetown Renaissance Project is an important component of the redevelop-ment of the Georgetown area. The city has

partnered with John Wieland Homes and Neighborhoods to construct a 35-acre cata-lytic redevelopment in Georgetown which dovetails with the Georgetown Master Plan.

The plans include a low density, owner-occupied residential development interwoven with city parks and a multi-use trail running across and connecting both properties. Additionally, the city is

seeking to reserve approximately 3 acres in the redevelopment project for a future neighborhood commercial node.

As for the Dunwoody Village area, the city is in the process of planning critical pedestrian improvements for Dunwoody Village Parkway. Converting the parkway into a two-lane street with wide sidewalks, street trees,

bicycle lanes and landscaping is consistent with the master plan and existing zoning. These improvements will help maintain efficient automobile flow through the com-mercial area and assist in realizing the city’s vision for a vibrant, pedestrian-friendly and functional village environment.

Q: What are the top priorities of the plan for 2012-2013?

A: With a goal of implementing long-range land use plans that will shape

the community’s future as its residents and stakeholders see fit, the compre-hensive plan was developed in order to help the city achieve more connectivity, walk-ability, green space and community gathering places and amenities. The top priorities on the table for 2012-13 include automotive and pedestrian transporta-tion improvements, the rewriting of our zoning code, and managing development in a way that protects the residential character of the majority of our city and improves our parks system.

Q: How are these priorities being funded?

A: These priorities are being funded by the use of previous year

reserves, annual budget funds and state and federal grants accumulated over the past four years.

Through prudent management of growth of our resources and healthy reve-nues, we anticipate annual budget revenue and use of prior-year savings will meet our

most pressing capital needs. While many local and municipal governments across Georgia and the nation faced continued economic challenges, the city of Dunwoody’s finances have fared better than most over the past few years.

Thanks in part to the city’s diverse rev-enue stream and an efficiently managed service structure, Dunwoody was able to realize a revenue increase each year of our existence.

Q: What are the challenges to getting the plan implemented?

A: One of our challenges as a city is to always ensure that we are

implementing and funding the right projects and programs, prioritizing needs over wants. We want to be in harmony with our community and as their plans and needs change, so must the city’s. We also want to be careful we don’t allow our spending to get ahead of our revenues. We continually promote sound, fiscally conservative budget management, but as unforeseen critical needs arise, we need to be flexible yet focused on our goal of staying true to our community’s plans.

W hen Dunwoody incorporated several years ago, the Dunwoody Preservation Trust had already been hard at work for years saving

the city’s historic treasures. Founded in 1995 and boasting 900 members, it has been instrumental in saving several prop-erties from demolition or destruction by decay and neglect.

“We’re looking to the future with a vision to the past,” said Dr. Jeff Priluck, a Dunwoody dentist and member of the board of directors for Dunwoody Chamber of Commerce. A 35-year resident of the city, Priluck said he was driving by the empty, decaying Cheek-Spruill Farmhouse in the center of town and thought, “Someone needs to take the bull by the horns and repair that, make it presentable.”

His wife agreed and said, “Why don’t we do it?”

So they did.“We did the exterior

and then decided to do the interior of the house,” Priluck said.

He recalls watching the last Spruill to live in the house prepare his garden plot with a mule-drawn plowshare decades ago.

“People come into my office every day and say they are so glad we did it,” Priluck said.

Today, the Cheek-Spruill Farmhouse (now officially dubbed the Dunwoody Farmhouse) is a city-owned event facility, where weddings, receptions, reunions and other events are held; it had been a teahouse for a time after the restoration was complete, but that has since closed.

“We decided not to go back with it as a full-stage restaurant so more people could access [the Farmhouse] and we could reduce the wear and tear on it,” said Molly Portis, who serves with her husband, Sam,

as co-president of the trust. Among other uses, the local high school last spring held an ice cream social on the grounds.

“Dunwoody decided it didn’t want a big parks department so they called on organizations such as ours [to take charge of some projects],” Portis said.

Priluck said efforts of the trust are important to retaining the city’s 150-year heritage and character; it makes Dunwoody more attractive to new businesses and residents who might be considering a move to the city.

“The Dunwoody Preservation Trust has been absolutely good for the city,” said Mike Davis, mayor of the city of 46,267 people. “It’s that group and others like it that make Dunwoody what it is. ”

The Donaldson-Bannister Home and its 3-acre property is another Dunwoody Preservation Trust undertaking.

Built in the 1870s, the two-story structure was purchased shortly after Dunwoody incorporated. So far, little has been done to it: “We are working with historical-architecture firms to plan the restoration,” Portis said.

She said future plans include restoring the Colonial Revival exterior to as near

pristine condition as possible and eventually the interior, complete with period furniture and furnishings. Already, she said, Dunwoody residents have offered to donate furniture and other items for the interior work.

Portis said the city has estimated it will cost up to $2.5 million for the total restoration of the Donaldson-Bannister Home; as a remodeling contractor and co-owner of Portis Building & Interiors with her husband, she calls that estimate “probably right.”

A swimming pool was filled in by the city and plans call for building a pavilion over it,

as well as repairing “an attractive brick wall” near it. Portis said that portion of the under-taking will, alone, cost $35,000 to $40,000.

“It’s going to be major,” she said. “But people want it open for events. I sense pretty strongly that people are going to use it.” She expects a capital campaign to be kicked off in the not-too-distant future.

Through Dunwoody Preservation Trust efforts, both the Donaldson-Bannister Home and the Cheek-Spruill Farmhouse have been placed on the National Register of Historic Homes.

This year’s Lemonade Days festival — held at the 90-acre Brook Run Park, site of a former mental hospital and another trust project — directed all its proceeds to the Donaldson-Bannister Home resto-ration effort.

The profit from the five-day event, held each April, exceeded $70,000.

“Every single penny goes back to our projects,” Portis said.

Indeed, Lemonade Days has somewhat taken on a life of its own.

“People really look forward to it,” Portis said . With a family-oriented mix of rides, exhibits, music and food offerings, the festival draws attendees from all around the Atlanta area.

It was initiated after a tornado tore through the area in 1998; the original plan was to raise money for replanting trees destroyed by the storm, as in making lem-onade from lemons. More than 25,000 trees were planted because of the success of the first Lemonade Days .

Other accomplishments that the trust was solely responsible for or worked on in partnerships with other organizations or governments are:

■ Researched and compiled “The Story of Dunwoody 1821-2001,” a book chroni-cling its heritage, and “The Silent Story Tellers,” which identifies more than 4,000 historical grave sites in Dunwoody. The trust has also produced a 30-minute DVD entitled “Dunwoody: the History & Heritage – 1821-2003.”

■ Assumed responsibility for mainte-nance of New Hope Cemetery, where some early settlers and Confederatesoldiers are buried.

■ Worked with DeKalb County to ensure a master land-use plan developed for the 102-acre Brook Run Park that preserved its natural beauty .

Preserving the past helps Dunwoody’s futureBy C. Richard CottonCONTRIBUTING WRITER

Q&A

DavisCity of Dunwoody

Davis: Dunwoody implementing master plans

PriluckDunwoody Chamber

of Commerce

PHO

TOS

/SPE

CIA

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PortisDunwoody

Preservation Trust

Restored farmhouse : The Cheek-Spruill home is now a city-owned event facility.

Donaldson-Bannister Home: It and the farmhouse are on the national historic register.