Tuesday, August 13, 2013

MARTA Looking to Confiscate Land in Sandy Springs and Dunwoody to Add "WorkForce" Housing?

We have written many times here about the TOD, the Transit Oriented Development.  The TOD is a government-funded housing complex that is built attached to a MARTA station (Atlanta). The goal is to force people out of their cars and onto MARTA.  It's the classic (failed) Live Work Play.  MARTA has failed to do anything right, and instead of providing what people want, they want to spend more taxpayer money and take private land to continue their failed mission.

I threw away my Tea Party issued tin foil hat a couple times, but always seem to get another one.  One thing the Tea Party nails it on is the Agenda 21 and the goal to build TODs in our major cities.

Once a week or so Real Estate Bisnow (ATL) sends out an email concerning real estate happenings in Atlanta.  Today's email blast talks about Charles Pursley.  You can go elsewhere and read about Charles, but it seems he is a smart and successful guy.  Charles thinks MARTA will be forcing itself on the fine residents of Sandy Springs by confiscating land (eminent domain, Charles' specialty) to force the building of at least one TOD in Sandy Springs.

Sandy Springs has not found a shiny new development it doesn't like.  The Sandy Springs council seems to let people build any sort of thing they want, as long as they pay taxes.  Does Sandy Springs have no sense of history and not realize these shiny apartments built in 2013 will be slums by 2033?  Apparently not.  I doubt MARTA would even need eminent domain in Sandy Springs, unless it is a land owner stopping the TOD.  

So back to the email blast:



Charles was instrumental in the creation of the modern MARTA system. After a stint in the Army and Vietnam as a judge advocate, Charles came to Georgia and joined the late firm Huie Brown & Ide and was tasked with helping MARTA condemn property to develop the system, including the property that eventually became the Five Points Station (above during its 1978 construction, you were probably at the disco when this pic was snapped) and the Peachtree Center Station. Charles says MARTA's current transit-oriented development plans—where it's getting input from developers to create mixed-use projects at various stations—has a dual purpose. "Ridership is a big part of that, and revenue is a big part of that," he tells us.


Now that development is picking up again in Georgia, Charles expects some real cases to come before the court. There are "potentially huge condemnation cases" coming regarding developments in the Sandy Springs area.
  

When you sign on MARTA and/or HUD as a partner for a TOD you (the city, developer, etc.) will receive Federal dollars, tax credits, grants, low interest loans, etc.  And what do you give up in exchange?  You give up any chance of the project being a short term or long term success.  You give up creating a quality place to live, work, and play.  That's not such a bad deal, is it?





By converting what is normally a private, for-profit venture project to a Government subsidized project you (the developer) will be required to set aside a percentage of the housing units for "work force" housing.  'Work force' housing sounds great, right?  Ask the folks at Atlantic Station how that work force housing deal played out.  Work Force Housing is actually a step below Section 8 Housing.  

Cobb and Gwinnett took lots of criticism for keeping the heavy and light rail out of their counties.  Now these counties cannot take advantage of having MARTA and HUD building 'work force' housing developments attached to rail lines.  

Dunwoody has a MARTA stop.  This land is now owned/zoned to be a development called High Street.  Although High Street has 1,500 apartments and 1,500 condos, the property owner will be able to rent/sell these units to the highest bidders at market rates, not to whom MARTA says to rent/sell them to.  Although not a huge fan of the 1,500 apartments approved for Dunwoody at High Street project (before we became a city), at least these will be rented on the open market.  There are thousands of apartments already approved for Dunwoody (approved prior to us becoming a city), and we don't need MARTA setting the monthly rates.  See HERE for details.

There are two MARTA stops in Sandy Springs.  One is in Brookhaven by the hospitals. The Sandy Springs stations are: one by the movie theaters and Sports Authority, and one on Peachtree Dunwoody Road.  Don't be surprised when the city council and mayor of Sandy Springs sign up for millions of tainted Federal dollars and tax credits for developers.  By the time HUD and MARTA get through with the handouts the developer will make millions more and Sandy Springs will get some road money.  Long term this TOD is a big loser for homeowners in Sandy Springs.  Even in the short term there is no upside.  MARTA has used eminent domain in the past and will use it in the future. 

I've written about the TOD a few times: See HERE and HERE




5 comments:

Anonymous said...

Fine job of 'threading the needle' between eviscerating SaveDunwoody for their Saturday Morning Special in an earlier post, then lauding Tea Party scare-meisters for their postions on Transit Oriented Developments, here.

All this without the benefit of any formal commercial real estate education.

Was it a recent stay at a Holiday Inn that gives you such amazing insight?

TOD's are to be watched and I applaud this 'shot across the bow' but let's get a few bona fide experts to come forward before getting so high in the saddle, laddy.


Anonymous said...

Anon 10:46

You don't get more of an expert on MARTA and eminent domain than Charles P. if Charles is setting up shop then you know there is some action and money to be made in the short term. Where Rick gets it wrong is that Marta is eyeing not Sandy Springs but the Dunwoody site behind the mall..

Anonymous said...

SaveDunwoody members are not smart enough politically to be Tea Party. Even the Tea Party would turn them away. Norb L and Alex need to find some new recruits as their current pledge class comes across as senile.

Anonymous said...

@Anon 11:13

"..some action and money to be made...," Yes, we live in a capitalistic society, whereby the government seeks to promote social policy sometimes choosing to use the tax code as an incentive.

Specifically, one should study the Low-Income Tax Credit.

The following brief helps one to understand the dynamics of multi-family housing investor mentality.

"Federal Low Income Housing Tax Credit

A significant change in the method by which the federal government assists the development of affordable housing was born with the passage of the Tax Reform Act of 1986. The Act includes Section 42 of the Tax Code, the Low Income Housing Tax Credit Program. The Tax Credit Program does not provide loans or grants but rather a tax incentive to owners of affordable rental housing.

The incentive is an annual tax credit (a dollar for dollar reduction in the tax payer’s federal taxes) earned in the initial ten years following when the units are placed in service assuming program requirements are met.

A developer markets or “syndicates” the credits allocated to the development to investors whose contributions are used as equity in the development’s financing plan. "

http://www.phfa.org/developers/developer/lihtc.aspx

For a scholarly discussion of how 'tax expenditures' like LITC actually do not work, one should review:

http://www.taxanalysts.com/www/features.nsf/Articles/CF7C354F881B80DE8525789B005A9626?OpenDocument

Today, the luxury of saying, "I do not know," is gone because questions are either unknowable or one chose not to look it up.

Dunwoody Dad said...

If memory serves, I didn't think MARTA had eminent domain authority on its own. Rather, MARTA had to rely on the county or municipality involved to exercise its powers of eminent domain on behalf of MARTA. Wasn't there a disagreement between MARTA and the City of Atlanta when they built the Armour Yard complex near Lindberg? I wonder, then, if DeKalb County would have eminent domain authority within the Dunwoody city limits. . .