Third & Urban, a real estate development firm, and Granite Properties, a commercial real estate investment, development, and management company, this week announced the sale of Inland Tract and COMPLEX, two adaptive reuse projects offering office and flex/showroom space in West Midtown.
Crestlight Capital, the Detroit and New York-based private equity real estate investment firm, and institutional investors advised by J.P. Morgan Global Alternatives acquired the two projects in an off-market transaction. The acquisition is part of Crestlight and J.P. Morgan’s “assemblage of four adaptive reuse projects located in the rapidly-growing West Midtown submarket of Atlanta,” according to the announcement.
Crestlight and J.P. Morgan also announced this week that they purchased Puritan Mill and Ellsworth. The four projects are expected to retain their individual names but will be rebranded as the “Westside Collective” portfolio.
Granite Properties and Third & Urban formed their joint venture in 2018 with the vision to transform Inland Tract and COMPLEX from old and vacant warehouses into creative workspace designed for “modern growth companies that wish to locate in one of Atlanta’s most dynamic submarkets.”
“We’re thrilled about our successful partnership with Third & Urban and we’ve executed on our vision for Inland Tract and COMPLEX,” John Robbins, Senior Managing Director, Granite Properties, said. “The time was right to harvest our capital and realize strong returns in today’s robust capital markets environment.”
Crestlight also owns Circa 730 in Midtown Atlanta, which the firm purchased in 2017.
“We invest in a handful of markets throughout the Sunbelt and Central US that we understand intimately through research, diligent work on the ground, past experience, and local relationships” Brian McAlpine, Chief Investment Officer of Crestlight, said. “We believe strongly in the continued growth in Atlanta. In light of our changing world, there will be short-term dislocation in the office sector, but differentiated assets in locations with sustainable growth like the West Midtown Collective continue to attract tenant demand. We plan to continue being active acquirers of these types of projects in our target markets.”
Third & Urban and Granite Properties completed the $16 million redevelopment of Inland Tract — two mid-century warehouses totaling 79,000 square feet — in 2018. The project is located at 1218 and 1236 Menlo Drive.
Sister project, COMPLEX, was redeveloped by Third & Urban in 2018 and recapitalized into the partnership with Granite Properties. It offers 110,000 square feet of similar space positioned for retail, showroom and creative office use, and is located nearby at 1175 Chattahoochee Avenue.
Puritan Mill, purchased from a joint venture between Origin Investments and Urban Realty Partners, was one of the original adaptive reuse projects in West Midtown. Redeveloped in 2002, Puritan Mill totals 83,000 square feet of creative office space with unique brick and timber interiors which are connected to a future section of the beltline.
Ellsworth, purchased from Origin Investments, was redeveloped in 2017 to provide 91,000 square feet of modern creative office, showroom and retail space, including a newly constructed building that is now home to Star Provisions and Bacchanalia.
The new ownership team has retained Lincoln Property Company to manage and lease the property. Leasing at the portfolio will be led by Michael Howell, Hunter Henritze, and Caroline Fisher, while property management will be led by Shane Froman, Stacy Abbate, and Ingrid Barnes.
“More details will be released regarding the ongoing improvement and branding plans as they become solidified in the coming months,” according to the announcement.