Newport RE’s vision of South Downtown as a utopian urban district with revived historic buildings, lively plazas, new towers with affordable housing components, and shop-lined streets is no more.
Instead, an Atlanta-based firm known for renovating neglected homes and ailing, older commercial properties around the city is stepping in, placing all of Newport’s holdings under contract.
The German real estate firm spent the better part of a decade amassing a huge portfolio of property—more than 50 buildings and 6 acres of parking lots across some 10 blocks—in the disinvested area south of Underground Atlanta and Five Points, just east of Atlanta’s Gulch. Newport’s initial renderings depicting what those blocks could become surfaced in 2017, and as recently as this past January, the company was still adding buildings to its South Downtown holdings, some of them inimitably historic.
Newport officials stated in a press release supplied to Urbanize Atlanta that Historic Hotel Row—the only component of the South Downtown vision that’s finished—will continue to see retail signings and openings throughout this year, including a Spiller Park Coffee outpost that’s aiming to open in the fourth quarter. Thai concept TydeTate Kitchen, which debuted in April, has quickly established itself as a neighborhood staple, per Newport reps, but it’s the only active business where a full slate of retail was projected in 2022 to be humming by now.
Signs of trouble with Newport’s development efforts came to light across the street from Hotel Row earlier this summer, where construction work appeared to have stopped on the conversion of the 222 Mitchell building, envisioned as an office-meets-retail cornerstone of the new South Downtown. Newport officials declined comment when pressed for updates by Urbanize Atlanta earlier this month.
Development firm Braden Fellman Group is under contract for an undisclosed price on all Atlanta properties in Newport’s portfolio, with expectations to close in the fourth quarter of this year.
Founded in 1981, the company has earned a reputation for thoughtfully converting industrial buildings and other properties into residences and offices. Recent Braden Fellman projects include downtown’s Revival Lofts—previously an abandoned eyesore for nearly two decades—and the adaptive-reuse of Adair Park’s Abrams Fixture Corporation complex.
Newport’s CEO Olaf Kunkat, who has extolled the virtues of Atlanta’s oldest blocks in numerous media interviews over the years, called the decision to pull out of the city “incredibly hard and difficult.” He said the South Downtown vision should continue with a developer based in the U.S. and called Braden Fellman “a uniquely qualified team.” We’ve reached out to Braden Fellman reps for comment and will update this story with any additional input that comes.
“We believe in this neighborhood wholeheartedly; our vision was right but our timing was off, and we have the highest hopes that South Downtown will continue becoming a cool, historic, downtown neighborhood that Atlanta deserves,” Kunkat said in a prepared statement.
“Simply put, the market changes coming out of COVID, prolonged war in Europe, and recent rise in interest rates [left] Newport and our South Downtown investors needing to reprioritize capital investments," Kunkat continued. "As a result, Newport will only be focused on investment and development opportunities in our primary market of Germany.”
April Stammel, Newport’s senior vice president of marketing, leasing, and community, said Newport’s groundwork over the past six years has set the stage for successful redevelopment. “We’ve assembled an amazing portfolio of contiguous historic buildings and vacant land,” said Stammel in the media release, “and I am fully confident this next chapter with Braden Fellman will inject the stability needed to continue pushing the neighborhood forward.”
The Atlanta Business Chronicle reports Newport had invested at least $155 million in its South Downtown holdings but was informed by German investors in March the spigot for more capital was being turned off. Braden Fellman heads told the newspaper they’re open to partnering with other downtown players such as Centennial Yards developers CIM Group to bring the area fully to life. The company owns about 2,500 apartments in Atlanta with 1,000 more in development, plus 550 units in Charleston.
According to Newport, Braden Fellman plans to resume construction but change tactics at the 222 Mitchel building, converting its former offices to residential units while delivering “a similar robust retail experience” to Newport’s original plans. Other immediate plans call for seeing through Hotel Row’s retail and restaurant openings.
Braden Fellman principal Andrew Braden said in a statement his company’s vision for South Downtown will echo Newport’s.
“It’s early in the process, but we’re excited about the opportunity to leverage our track record in historic preservation,” said Fellman, “and [we’re] inspired by the work Newport started to maintain the rich history of the buildings in South Downtown.”
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