Centennial Yards scores nearly $600M in financing to fuel growth Josh Green Mon, 09/23/2024 - 12:53 A downtown megaproject called one of the largest public-private partnerships in the U.S. and the “central attraction in Atlanta’s ongoing revitalization efforts” has secured a major infusion of funding to help it toward a goal of being finished within about six years, officials announced today.
Financial services firm D.A. Davidson’s Development Finance Group has closed $575 million of bonds in a complex deal meant to fuel Centennial Yards’ 50-acre remake of the downtown Gulch in coming years.
Kyle Thomas, D.A. Davidson’s Development Finance Group managing director, called the deal “the largest transaction in our group’s history” for an urban revitalization project among the biggest in the country right now. The company served as co-manager in the financing arrangement, alongside lead manager J.P. Morgan and co-manager Truist Securities.
“By leveraging our expertise in structuring complex, large-scale, early stage financings which are solely secured by tax increment,” added Thomas in a prepared statement, “we’ve been able to support the transformation of this historic site into a vibrant, inclusive community that will benefit all Atlantans.”
The $575 million in bonds were issued through the Atlanta Development Authority.
Specifically, they consist of $356 million Convertible Capital Appreciation Economic Development Certificates secured by a 5 percent EZ Fee—or what’s similar to a sales tax—that’s set to be collected within Centennial Yards, once it begins opening.
The rest of the financing is being sourced from $219 million in Senior Revenue Bonds secured by property tax increment within the Westside Gulch, according to D.A. Davidson reps.
Centennial Yards is considered a partnership between the Atlanta Development Authority, the City of Atlanta, and Los Angeles-based developer CIM Group, which counts more than $29 billion in assets, among other stakeholders. A CIM affiliate, Spring Street LLC, is leading the development, while co-investors are being led by Atlanta Hawks owner Tony Ressler, the brother of CIM cofounder and principal Richard Ressler.
It’s expected to cost in the ballpark of $5 billion overall.
View of the Centennial Yards tower projects in August from the east, across the Gulch. Josh Green/Urbanize Atlanta
“We’re committed to enhancing and supporting the communities in which we invest,” Brian McGowan, Centennial Yards Company president, said in a statement. “By building upon the rich history of Atlanta as a pivotal rail hub, Centennial Yards will not only honor the past but also create a vibrant future.
D.A. Davidson’s announcement also provides some updated clarity on Centennial Yards’ ambitious scope.
Current plans call for more than 2,600 residential units to be built, with 20 percent of those reserved as affordable housing. (The project’s first ground-up new residential tower, the 304-unit The Mitchell, topped out last month). Elsewhere will be almost 3,000 hotel rooms in projects ranging from boutique to full-service, alongside more than 900,000 square feet of entertainment and retail space, according to the financing update.
Just east of the first apartment tower, Centennial Yards has also broken ground on an 8-acre, mixed-use entertainment hub anchored by a Cosm entertainment dome with a fan plaza at the center. Those buildings are scheduled to be finished in time for eight 2026 FIFA World Cup matches set to be played in Atlanta, beginning in June that year.
In terms of new infrastructure, Centennial Yards’ designs call for creating a dozen city blocks downtown, with a police mini precinct, a new fire station, and public greenspaces tucked among them.
Project leaders say they’re aiming for 38 percent participation from minority and female enterprises and small businesses as a means of providing inclusivity and economic opportunity.
Expected look of activated patios at The Mitchell building, with Mercedes-Benz Stadium across the street. Courtesy of Centennial Yards; images by Apex Visualization
How the entertainment district is expected to meet Centennial Olympic Park Drive, near State Farm Arena. Courtesy of Centennial Yards; images by Apex Visualization
All told, Centennial Yards’ buildout is forecasted to add more than 5.7 million square feet of residential, retail, and commercial spaces downtown. Plans call for completing the project by 2030, according to D.A. Davidson’s announcement.
Founded in 1935, employee-owned D.A. Davidson Companies is headquartered in Great Falls, Montana, with regional headquarters in Denver, Los Angeles, New York, Omaha, and Seattle. It counts roughly 1,475 employees and offices in 28 states, per company officials.
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Images
Expected look of activated patios at The Mitchell building, with Mercedes-Benz Stadium across the street. Courtesy of Centennial Yards; images by Apex Visualization
As viewed from the north last month, the 19-story Mitchell apartment tower now overlooks Mercedes-Benz Stadium. Josh Green/Urbanize Atlanta
Construction progress on base levels of the 18-story Anthem hotel project, situated just north of the apartment tower. Josh Green/Urbanize Atlanta
Courtesy of Centennial Yards; images by Apex Visualization
View of the Centennial Yards tower projects in August from the east, across the Gulch. Josh Green/Urbanize Atlanta
How the next Centennial Yards phase is expected to meet Martin Luther King Jr. Drive (left), with active rail lines separating it from the Anthem hotel tower (back left) and The Benz. Courtesy of Centennial Yards; images by Apex Visualization
Planned look of a plaza area at Centennial Yards’ entertainment district. Courtesy of Centennial Yards; images by Apex Visualization
How the entertainment district is expected to meet Centennial Olympic Park Drive, near State Farm Arena. Courtesy of Centennial Yards; images by Apex Visualization
Courtesy of Centennial Yards Company
Main entry point to the entertainment district along Centennial Olympic Park Drive. Courtesy of Centennial Yards; images by Apex Visualization
Courtesy of Centennial Yards Company
Courtesy of Centennial Yards Company
Plans for the Cosm venue’s exterior, at left. Courtesy of Centennial Yards; images by Apex Visualization
Subtitle Financial firm calls project one of largest public-private partnerships in U.S., with 2030 goal to finish
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