It was just a field in 1994, but Ben Carter saw something more, something that is quickly becoming the Mall of Georgia, a 1.7 million sq. ft. regional mall in the growing Gwinnett/Hall County area of metro Atlanta.
"In 1994, I went to see my friend Scott Hudgens with a map of Atlanta that had four rings on it for proposed new regional malls," says Carter. Hudgens said he was already working on two of them, thought little of opportunities up the Georgia 400 highway corridor, but liked Carter's I-85 idea.
That was the start, and now that construction is moving along, the final piece of the puzzle was that little thing called "financing."
"In 1995 we began conversations with numerous partners and in 1996 signed a letter of intent with Corporate Property Investors which was bought out by Simon in 1998," says Carter. "We were looking for a partner with capital resources and interest to put together a very unique project. Because of the size of the project and the number of long-term anchor leases, the financial commitment was substantial. We also wanted a partner that understood the Atlanta market and the opportunity for the project to providethe more affluent suburbs an option to the Buckhead/Lenox area."
"Our partnersh ip with Simon is a 50/50 partnership on the mall land and Mall of Georgia Crossings (power center). Between 1994 and 1997, Scott Hudgens and I handled the financial needs of the project for pre-development permitting and design and anchor store negotiations. Once the department store agreements were executed, we were able to complete our equity and financing funding with Simon and our lenders."
Today, the mall's construction is about 85% complete, with a scheduled opening on August 12, 1999. "At that time, we expect about 85% of the project stores to be open and the remainder opening between August and March 2000, when Nordstrom opens," says Carter.
Major tenants signed include the project's anchors - Dillard, JCPenney, Lord & Taylor and Nordstrom - with room for two additional department stores. There is a 20-screen Regal Cinema including a 3-D Imax theater. Also, retailers Havertys, Bed Bath & Beyond, Galyans, Barnes & Noble, Restoration Hardware and Jillians have all committed.
As Carter was shopping for funding, he encountered a nice array of financing sources. "Capital sources in our industry are numerous. They range from pension funds to foreign investors and institutional capital. As well, there is a major influence of entrepreneurial or high-wealth individual capital. I believe that with this consolidation of our debt and equity with the public markets, there is a growing need and opportunity for entrepreneurial capital in putting together development or redevelopment projects," says Carter.
Like a lot of major metro areas around the country, there is always talk of overbuilding, particularly in the retail sector. Is this a concern in Atlanta? Carter thinks so.
"I think the retail overbuilding in Atlanta is a concern, primarily when you are dealing with shopping centers that are anchored by companies that may no longer be the leader in the market or in their category. For example, Atlanta has had tremendous growth of grocery store-anchored shopping centers as both Publix and Kroger have expanded their position. As a result, I believe there is an overbuilding in the grocery sector when anchored by some of the other grocery store operators. The same is true for power centers as many of these centers are anchored by one to three stores that may not be the leaders in their category. As the competition settles out with these anchor stores, I think we will have some overbuilding as stores or companies close," says Carter.
His vision for the Mall of Georgia remains intact, though, and through an aggressive leasing program, the project has proven more successful than most imagined even a few years ago.
"I believe the Mall of Georgia provided an opportunity to create a special place by master-planning 500 acres and controlling the quality and style of development," says Carter. "We are currently in conversations with property owners in other southeastern cities and this time are looking for 500 to 1,000 acres so we can provide a more mixed-use development with the additional acreage. These uses would include more office and residential."
Can anybody say, "There he goes again?"