News

NEWS
25
July
Selig Enterprises abandons plans for downtown Athens development

After two years of redesigns and at-times fierce community debate, the Selig Enterprises development in downtown Athens is dead.
The Atlanta-based firm abandoned its plans for the $90 million mixed-use development after market analysis and attempts to find funding for the project, according to a news release issued Tuesday evening.

The project would have covered three city blocks, with several buildings rising five and six stories high on nine acres between East Broad and Oconee streets on the Armstrong & Dobbs tract. Plans for the project, dubbed the Foundry at Broad, called for 102,000 square feet of commercial floor space and almost 1,000 bedrooms.
“Over the past two years, we’ve invested a lot of time, energy, and financial resources trying to bring the Foundry at Broad project to fruition,” Jo Ann Chitty, Selig’s senior vice president, said in the statement.
Chitty did not immediately return phone messages Tuesday evening.
She cited in the news release rising construction costs, site development costs and the changing “dynamics of the marketplace” during the past six months as factors that “ultimately made the project economically unfeasible.”
“It’s bitterly disappointing,” Chitty said in the release. “It has been a dream of ours to build a project in Athens that the community could be proud of.”
The development firm indicated that it hasn’t necessarily abandoned that dream, with Chitty saying Selig will “hope to take another look at Athens should the right opportunity arise."
Selig planted the seeds of the project in fall 2011. Rumors of it housing a Walmart divided the community. Some Athenians continued to smolder at the developer due to the project’s size, even after a redesign halved its commercial space. The redesign also changed its integration with the Firefly Trail.
The most recent battle over the project was fought in July when it sought a special use permit for 15 ground-floor apartments along Wilkerson Street. It otherwise fit code for downtown Athens. It passed with support from every Athens-Clarke County commissioner but George Maxwell and Jared Bailey. Mayor Nancy Denson also supported the project and sat with its representatives at a planning commission meeting precursor to the mayor and commission vote.
She said the loss of the project was “terribly disappointing.”
“I think it was a good project for the community,” Denson said. “I’m disappointed for the property owners that could not sell their property, I’m disappointed for those who would have benefited from the development in downtown and mostly I’m disappointed for the people in downtown who won’t benefit from access to the necessities of life.”
Commissioner Kelly Girtz, who authored the proposal that helped the special use permit pass, said he remains nonetheless proud of the work done on the property and hopeful for its future.
“Like a lot of people, I wanted it to be the best project it could be,” he said. “... More than anything, I just hope someone comes up with a fantastic proposal for that site. It remains for sale and maybe it’s an opportunity for someone with a great idea or a consortium of people.”

25
July
Tesco unlocks its landbank to build 4,000 new homes

£1bn building plan comes after revelation of 310 unused sites, with retail plans shelved due to shift in shopping habits.

The plan, announced weeks after the Guardian revealed that Tesco is hoarding land that could support 15,000 homes, is the biggest housebuilding project ever announced by the supermarket.

Among the Tesco sites set for housing developments following Friday's announcement will be Welwyn Garden City, Hertfordshire, close to the retailer's operational headquarters, where it plans to build more than 700 homes on a site where it previously planned a store.

The trade journal Property Week said the majority of the sites will be in the south-east of England but developments are also scheduled further north, including in Liverpool and the west of England. Schemes include 80 houses and flats on the former Evershed printing works site in St Albans, Hertfordshire.

Tesco said it was likely to build homes itself via its development wing, Spenhill, while also selling sites to housing developers, in a programme that has been valued by Property Week at £1bn, based on a valuation of £250,000 per home.

A Tesco spokesperson said: "In response to changing customer shopping habits we have decided to reduce the amount of new store space we build each year, building fewer large stores. Where we no longer intend to develop sites, we sell them, lease them or develop them for housing.

"We are pleased to be bringing new investment to communities up and down the country and playing our part in meeting local housing needs over the coming years."

Last April Tesco boss Philip Clarke cut the value of about 460,000 sq m of its land by £800m as he admitted the company would have to sell off land where it had previously planned to build stores, store extensions and distribution centres. However, the company has been slow to act as the most ready buyers for much of its land stock are likely to have been rivals such as the fast-growing Aldi and Lidl chains.

Retail analysts said Tesco was now turning to housing developments because residential development was more economically viable. The poor performance of out-of-town supermarkets meant the land was not necessarily worth more if it was dedicated to new retail sites.

Clive Black, an analyst at Shore Capital, said Tesco was under pressure to act due to public and political demand for space to build housing, alongside calls from shareholders to recoup some of the value of the land.

"This is a silver lining on a very dark cloud," said Black. "Tesco is at least trying to maximise value after a high-profile profits writedown but it's not clear how much it will be able to claw back. It's a sensible move and better than building a Tesco store that's not economic or selling to the competition."

Tesco already has a policy of building homes above or beside its stores as part of efforts to gain planning permission. In London alone, Tesco was set to build more than 800 homes last year, close to 5% of all non-local authority homes being built in the capital. That included projects in Woolwich, Highams Green and Streatham, where Tesco built a total of 450 homes.

Other supermarkets are also developing housing, with at least 4,500 homes expected to be built by the major grocers between 2013 and 2018. J Sainsbury was set to begin projects involving more than 1,500 homes this year, including a partnership with Barratt on a major development in Battersea, south London, which includes 700 homes and a new tube station. Some developments are smaller in scale. Waitrose has developed a number of stores topped by flats, while many retailers are turning redundant pubs into convenience stores with housing above.

11
June
Where would you buy a luxury home for £4 million in London?

Expensive hotel accommodation is pushing up the price of residential meetings in London, despite competitive DDRs, according to new research.

The study, conducted by BDRC Continental on behalf of Meetings & Incentive Travel, found London to be more expensive than seven other major European cities.

Total event costs (including three-night’s accommodation, meeting space and F&B for 100 delegates at comparable branded hotels in August) came in above those of Amsterdam, Barcelona, Brussels, Frankfurt, Milan, Prague and Vienna, at €87,434.

This is 75 per cent more expensive than the second priciest city, Barcelona at €50,033, and 221 per cent more than the cost of hosting the event in the cheapest city; Prague at €27,209.

However, when accommodation costs are separated from the cost of the meeting, the margin between the destinations is much smaller. There is only 21 per cent difference between the cheapest meeting costs (€20,550 Vienna) and the most expensive (€24,825 Barcelona) – with London coming in second place at €23,846.

When it comes to accommodation, at €108,525 London is 44 per cent more expensive than its nearest competitor (Barcelona €74,858) and 121 per cent costlier than Prague - the cheapest at €48,761. In this fictional brief, 80 per cent of the cost of the event in London comes from hotel room nights.

According to BDRC’s research, London-based companies would be financially better off holding their events overseas, even once travel costs have been taken into account – to the tune of €14,006 by choosing Barcelona, ranging up to €48,097 by selecting Prague.

Despite the stark figures, the report’s author, client services director, James Bland said London – as a ‘top-tier city’ - still offers value for money.

“Once again, London has topped the price league for accommodation, although the cost of its meeting space is far more competitive. This micro-study shouldn’t be misinterpreted as a blanket condemnation of the city’s value proposition,” he said. “Although the nominal costs of leaving London make it look like a “no brainer”, there are other factors (time and convenience) to consider, as well as the possibility that London charges more because it can command and justify that sort of margin.

“This research, therefore, merely points out that to choose London for this three-day event of 100 people, our mystery buyer would have spent between €14,000 and €48,000 more - even after having flown all of their delegates from Heathrow. It is for the real buyers to decide whether that would be money well spent.”

Tracy Halliwell, head of business tourism and major events at London & Partners, said: "London has some of the best hotels in the world like the new 6 star Shangri-La Hotel, At The Shard combined with a vast selection of low-cost accommodation and innovative, cost-effective hotels such as Hub by Premier Inn on St Martin's Lane are continually being added to the city's offer. There are also 30,000 hotel rooms currently under construction or with planning consent in the capital. Within this number are increasing volumes of additional budget accommodation to supplement the proportion of 4 and 5 star properties already in the city.

“London is a destination chosen for its world-famous attractions, its stunning landmarks, its world-class culture, its popularity as a business centre and its growing tech and medical sectors. Value is driven by the complete delegate experience of a meeting, event or conference – a fact event planners agree on – rating London as the top destination for return on objective compared to similar events held elsewhere.

“London & Partners’ convention bureau team offers every support to event planners and agencies and we are constantly handling group housing requests for budgets large and small. Where we can add value is in working with organisers to find the optimum time periods for the most preferential rates and we have developed a wide range of accommodation partners to help us achieve this. London & Partners consistently works with hoteliers to negotiate rates and terms and conditions for major events, highlighted by the launch of our Accommodation Charter a few years ago. As an organisation we proactively support new accommodation providers looking to enter the London market and work closely with the GLA economics team to forecast future visitor numbers and plan ahead for increased demand for bedrooms.”

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