An apartment development boom is reshaping the new Perimeter cities and sparking debates about density, traffic and quality of life.
From the new Mercedes-Benz USA headquarters project in Sandy Springs to the old Hastings Nursery in Brookhaven, residents are packing neighborhood gatherings and city zoning meetings in order to push back against massive apartment plans. This week, an apartment proposal even triggered friction between cities, with Brookhaven’s mayor complaining of lack of input on a Sandy Springs border project.
Yet, at the same time, city officials argue that mixed-use apartment complexes will give them attractive, walkable downtowns where outmoded, car-centered suburban strip malls now stand. That creative tension will continue along with the apartment trend, real estate and planning experts say.
Apartments are the growth area of residential development, driven by “a switch from ‘I rent because I have to’ to ‘I rent because I want to,’” said Ron Cameron, a senior vice president at Colliers International-Atlanta who specializes in multifamily real estate investment.
Millennials and retiring baby boomers drive the trend to create new “live-work-play” places such as Brookhaven’s TOWN/Brookhaven and Sandy Springs’ planned City Center project, according to Cameron.
“The bottom line is, who wants to live in a place that’s not a place?” says Michelle Alexander, Sandy Springs’ director of community development.
The irony is that Brookhaven, Dunwoody and Sandy Springs incorporated partly out of concerns that apartment projects were overwhelming single-family neighborhoods. Dense apartments have been viewed as generators of traffic, crime and infrastructure strains. Some new projects are replacing older apartments with new, luxury-oriented models, but many of these criticisms remain.
Two apartment-complex owners sued the city of Dunwoody in 2013, accusing the city of trying to force low-income apartments out of business. The lawsuit was dropped, but it illustrates the sense of tension in a city that the head of the Dunwoody Homeowners Association says is now roughly half homeowners and half renters.
Robert Wittenstein, a former Dunwoody city councilman and current DHA president, explained some of the local concerns. “Apartment-dwellers tend to be more transient, tend to have less of a stake in the community,” he said. “This is a great place to come, and we want [residents] to stay.”
School system capacity is a big infrastructure issue as well. “All of our schools have trailers…Every building that gets built creates overcrowding in schools,” Wittenstein said, noting that applies to dense condo projects, too.
Density can also solve infrastructure problems. Sandy Springs Mayor Rusty Paul often points out that apartments located near workplaces should reduce the city’s notorious commuter traffic. Then again, Paul has reservations himself about the pace of the city’s apartment boom.
“I don’t think we need to redevelop Roswell Road all at one time,” he said at a recent City Council meeting.
At a glance, it looks like that’s already happening. More than 2,400 apartments are approved or under construction at various sites on the Roswell Road corridor. The city made such developments a key part of its 2012 downtown master plan. In fact, it’s a partner in one of them—the public-private City Center project, which pairs a new City Hall facility with multi-family housing.
The Sandy Springs City Council is often split on whether apartment proposals match those City Center goals or are overdoing the density. A mixed-use project at 6075 Roswell Road that came before the council last month was a case in point. The council ended up approving the project—but also cut the number of apartment units by roughly 10 percent.
The situation highlighted holes in the city’s zoning code, including lack of how to measure density or how to define “mixed-use.” The city is embarking on a full rezoning and planning process in part to get a better handle on the development boom.
“When are we going to decide enough’s enough?” City Councilman Graham McDonald asked at that meeting.
The 2012 City Center master plan contained projections for how many new apartments the area market would bear in coming years. After approval of a multi-use project on Roswell Road in July, the city passed the number of apartments it had projected for 2017 and was closing in on its 2022 numbers.
Cameron said that is part of an Atlanta market boom. About 11,000 new multifamily units—including apartments and condos—have been built in the past seven quarters in metro Atlanta, he said. There is still plenty of demand, as suggested by rents continuing to climb: 5.5 percent last year and more than 7 percent higher so far this year.
Millennials are a huge demographic that demands “mobility and flexibility” in housing, Cameron said. They don’t want to drive everywhere, and in today’s market, they can “rent a place as nice any [house] they could dream of having.”
Retired baby boomers are another growing demographic moving away from high-maintenance, single-family homes. Cameron said market experts estimate that by 2030, the number of U.S. renters age 65 and older will more than double to 12.2 million.
With that kind of momentum, the question is not whether the Perimeter will have more apartments, but where they will go and how they will mix with their surroundings. The only slowdown in sight, Cameron said, is rents eventually outpacing incomes.
“The thing we talk about a lot in our business is the affordable component,” Cameron said. “At some point in time, the millennial renter is going to say, ‘No mas.’”
Note: The developer of the JLB/Gateway site, 4586 Roswell Road, has building permits for 316 units in the first phase of the entire project. A second phase could bring the total to 630 new units. The project replaces 436 existing units.