A multifamily developer led by one of the icons of the industry is taking a gamble on its first project in the northern Atlanta suburbs.
Terwilliger Pappas — led by Ron Terwilliger, the former CEO of Trammell Crow Residential — has broken ground on Solis Town Center, a 240-unit apartment mixed-use project adjacent to Suwanee Town Center, in one of Gwinnett County’s more affluent communities. The project, at the intersection of Lawrenceville-Suwanee Road and Buford Highway and designed by Cooper Carry, will also include 12K SF of retail to augment the 100K SF of retail and 87K SF of office already at Suwanee Town Center. Terwilliger Pappas purchased the more than six acres from the City of Suwanee with a winning bid and fused it with a lumber yard next door to prevent the developer from having to construct a parking deck, which would have kept it from moving forward with the project, Terwilliger Pappas Regional President Alan Dean said. As part of the deal, Terwilliger Pappas carved out a portion of its property and sold it to CalAtlantic Homes, which will develop 71 for-sale townhouses. For Dean, building the mixed-use Solis Town Center is not much of a gamble. “In the suburbs, it’s a clear case of pent-up demand,” he said. “Look no further than Avalon. And look no further than the rent growth.”
Recent statistics echo that sentiment. In a recent RentCafé report, the number of renters in Atlanta’s suburbs jumped by 26% — there were more than 52,000 new rental households — between 2011 and 2015, while the urban core only gained some 15,000 renters, or 10%. That occurred at the same time that a bulk of the new apartment stock was built inside Interstate 285. Those are the kinds of statistics that have Terwilliger Pappas’ institutional investors taking notice of the suburbs, a place those same investors largely ignored even three years ago, Dean said. Even with the demand, suburban governments still put up a lot of road blocks for apartment developers. That has created a supply-constrained environment attractive to Terwilliger Pappas’ investors. “And now they’re absolutely interested in [suburbia],” he said. Of course, Terwilliger Pappas is not the only player in suburbia. In recent months, other developers have begun projects in the northern suburbs, in particular, including Brand Properties, which is doing two projects — one in Peachtree Corners and the other near the Gwinnett Arena — as well as Richport Properties, which is developing a $20M mixed-use project in Downtown Lawrenceville that will include townhouses and single-family cottages. Since forming in 2013, Terwilliger Pappas has built a mini Class-A apartment empire under the Solis brand throughout the Southeast, including eight properties in North Carolina and one in Nashville.
Atlanta’s push is more recent: Last April, Terwilliger Pappas completed Solis Downwood off Howell Mill Road in Buckhead. It is now nearing completion of Solis ParkView, a 300-plus-unit apartment project connected to the Parkview on Peachtree mixed-use campus off Peachtree Road in Chamblee (in a joint venture with Connolly Investment & Development). Most recently, Terwilliger Pappas broke ground on Solis Decatur, a 290-unit apartment community directly across from the North DeKalb Medical Center, and part of North Decatur Square, an 89K SF mixed-use retail project anchored by Whole Foods 365 in a joint venture with SJ Collins Enterprises. But going forward, Dean said the firm will likely look farther out in the suburbs for new projects, especially as land prices escalate and a deluge of new apartment units, theirs included, hit the market within the city. But not all suburbs are created equal. Walkability is one key. Strong demographics are another, Dean said. “No. 1 we’re looking for a walkability component,” he said. “So a 10-acre site in the middle of nowhere where there’s no walkability is not what we’re looking for.” Terwilliger Pappas is exploring markets like Kennesaw, Roswell, Alpharetta, Johns Creek and even Peachtree Corners, Dean said. “We got more coming down the pike,” he said. “It’s been a strategy we’ve been focused on the last couple of years.”