As the Prado Shopping Center takes a hit with two major tenants, Publix and 5 Seasons Brewing, announcing closures, three other Sandy Springs shopping centers have recently been sold to developers, attracted to their location in Sandy Springs and the city’s urbanization, an expert says.
The Sandy Springs Crossing shopping center at the intersection of Abernathy and Roswell roads was sold in December 2018. Neighboring Roswell Road centers The Exchange at Hammond and Parkside Shopping Center were sold in October 2018. No major renovations are planned for now, the new owners say.
Scott Amoson, the director of research at real estate firm Colliers International’s Atlanta office, said part of developers’ interest is likely due to Sandy Springs becoming more urban with more walkable areas and a “new identity for the area created by City Springs,” the city’s new art and civic complex, which drives more interest in shopping centers. The new apartment complexes coming online along Roswell Road are also expected to add more foot traffic to the centers, he said.
City officials are encouraging mixed-use developments like those along Roswell Road that replaced similar shopping centers. City Springs itself replaced a vacant Target store.
Amoson said he doesn’t anticipate major renovation or addition due to the lack of space at the shopping centers, but they could use some type of facelift, he said. Multifamily developments, like apartments, could add significant value if developers have the room, he said.
The lack of vacant parcels available for development drives interest, making developers more likely to jump at the chance when they see a shopping center come on the market, he said.
“When you have an existing property with a good mix of tenants, I think people are going to be interested,” he said. “That type of investment doesn’t come too often.”
The shopping centers also have a strong mix of stores that aren’t challenged by the internet, like medical offices, restaurants and nail salons, Amoson said. A long-term lease from a satellite campus of Gwinnett College at Sandy Springs Crossing is also a bright spot, he said.
“Between those three types of tenants, [the shopping centers] are gold,” he said.
The Exchange and Parkside
The Exchange at Hammond and Parkside Shopping Center were sold earlier this year to Jamestown, creating the biggest sale in the metro area in 2018, Amoson said. Parkside went for $39.1 million, and The Exchange for $54.7 million, according to Fulton County property records.
Michael Phillips, the president of Jamestown, the developer behind Ponce City Market, said the tenant mix and location were driving factors behind the purchases. He agrees Sandy Springs is becoming more urban, and said the grocery store, movie theater and various stores were draws.
Parkside lost a few businesses last year, including comic book and clothing stores and the Sandy Springs Visitor Center.
Phillips said he doesn’t expect major changes, but does envision bringing more local businesses and restaurants, including “fast casual” food and modernizing the centers. Trying to combine the two to seem more line one shopping center is also on the table, Phillips said.
Sandy Springs Crossing
FCA, the new owner of Sandy Springs Crossing, plans to fill vacancies with “services and food tenants,” said Albert Lindemann, the managing partner of FCA Partners, through a spokesperson. There are “no plans for redevelopment at this point,” he said.
“This area is so well-established that we believe it will only get better with increasing density in Sandy Springs and continued employment growth in Central Perimeter,” Lindemann said in a release.
It is anchored by an LA Fitness, and other tenants include several restaurants and a satellite campus of Gwinnett College.
“This retail node has really solidified in the last several years largely in part due to the apartment growth in Sandy Springs and the staggering job growth within Central Perimeter. Being on the ‘going home’ side of Abernathy also benefits our tenants,” Lindemann said.
Sandy Springs Crossing was last sold by Coro Realty in 2015 to RCG Ventures for $23.4 million, according to Fulton County property records.
The Prado, owned by North American Development Group, lost a restaurant and grocery tenant that anchored the center in December.
“After nine years at the Prado Shopping Center, Publix has decided to close this location because it has been underperforming for some time,” said Brenda Reid, a spokesperson at Publix’s Georgia office, in an email.
For Amoson, the Publix closure doesn’t signal a wider trend, especially since the store was known to have had low sales.
“I just think it’s part of maybe too much saturation of grocery stores in certain areas of our market,” Amoson said. “The ones that are well-located and up-to-date, and offer the newest and best experience to meet customer preference will always be the winners.”
He thinks the vacancy should fill quickly due to its high-traffic location.
Publix was one of the anchor tenants at The Prado Shopping Center located at 5600 Roswell Road. Other businesses there include Target, Taco Mac, Starbucks and, until recently, 5 Seasons Brewing Company, a restaurant and brewery.
The brewpub announced in a Dec. 31 Facebook post that it would not reopen.
“As many of you know, tonight marks the end of our lease here at the Prado location and we will be closing our doors here in Sandy Springs at midnight,” the business said in the post. The second location in Atlanta at 1000 Marietta St. will remain open.
5 Seasons Brewing had been open in The Prado since 2001, according to the business’ website. Following the redevelopment of the shopping center in 2007, 5 Seasons Brewing sued the developer, Sembler, fearing the restaurant would go bankrupt if it did not receive compensation for losing business during construction.
The redevelopment opened also opened with a Staples, which closed in 2014. Restaurants have come and gone, including Mexican fast food restaurant Barberitos, which closed last year. But main anchors Target and Life Time Athletic have remained.