The Gulch — the nickname for an underdeveloped former rail yard in downtown Atlanta — could be getting new owners.
It’s about nine acres of parking lots and old railroad tracks under the bridges to Phillips Arena and Mercedes Benz Stadium. It has been underdeveloped for fifty years and generating no tax revenue.
Last month, in an effort to change that, the city put out an invitation to bid on the property. Monday it said it plans to sell the land to a California real estate group, CIM Group. That company would spend billions of its own money on the 13-block project.
How much public funding could it get?
“Upwards of a billion dollars,” according to the news release.
CIM Group was co-founded by Richard Ressler, the brother of Atlanta Hawks’ owner Tony Ressler.
At least 20 percent of the multi-use project’s housing will be affordable, or a minimum of 200 units.
“At roughly the equivalent of thirty football fields, this will be the largest development of its kind in Atlanta’s history and in the entire Southeast,” Mayor Keisha Lance Bottoms said in a news release.
The public money would come from a state sales tax exemption and an extension of the Westside tax allocation district (TAD). That’s a financing tool, which freezes property tax allocation to the City, Fulton County and Atlanta Public Schools, and re-invests the difference into economic development.
Getting the bonds and tax allocation district exemption requires City Council approval. There’s a work session scheduled for next week to begin the formal discussion.
Councilmember Amir Farokhi said he’s looking forward to getting a handle on “how much public money is really being put up to support this private development.”
He said while these are “future dollars,” not from the City’s general fund, “that money that would still be diverted to support the project is money that can go to a lot of different services, whether it’s infrastructure, public safety, parks.
“And these are things we need to think about as we grow as a city: can we serve the basic services of the city?”
Farokhi also has questioned the role of the Eastside TAD in the process.
At a TAD work session last week, Farokhi said he first discovered that Invest Atlanta had frozen the Eastside TAD for about a year. Part of that TAD is in his district.
On Tuesday Farokhi introduced legislation asking Invest Atlanta to unfreeze it immediately. Invest Atlanta said the decision was because City Council had previously considered closing it, though no legislation was passed. Farokhi said Invest Atlanta shouldn’t have acted on proposed legislation and there could be another reason.
While there has been no formal acknowledgment of this from the Mayor’s office, Farokhi referenced reports that the administration wants to “tie the extension of the Westside TAD to potentially the closure of the Eastside TAD. … I think those are two separate issues that should have been discussed separately. And to tie them is frankly bad public policy.”
The Atlanta Journal-Constitution has reported that the mayor and Atlanta Public Schools have discussed closing the Eastside TAD in exchange for an extension of the Westside TAD.