The deal was first named “Operation Slam Dunk.” But Brookhaven Mayor John Ernst, an Atlanta Hawks season ticket holder, suggested “Operation Windmill Dunk.”
“I thought we should name it after Dominique Wilkins’ signature dunk,” Ernst said in an interview. Wilkins, known as the “Human Highlight Film,” played a key role in the team’s success in the 1980s and is known as one of the best dunkers in the NBA.
But the deal was definitely a slam dunk for Brookhaven, according to city officials involved in negotiations to bring the team to the city.
“Operation Windmill Dunk,” as it was dubbed on the city’s Development Authority agendas last month, became public on April 5 during a press conference at Philips Arena when the Atlanta Hawks announced a partnership with Emory University to build a 90,000 square-foot state-of-the-art practice facility in Executive Park in Brookhaven.
The facility will combine the Hawks’ training facility and Operations Department with Emory sports medicine facilities. Emory will become the team’s official sports medicine provider and gets naming rights to the facility. Emory’s entire Sports Medicine Center will move to the Brookhaven site as well.
The move to Brookhaven is a “signature moment for the city,” Ernst said at the April 12 City Council meeting. “This is a good deal for Brookhaven.”
The Emory/Hawks partnership is a $50 million deal for the land purchase and building construction with $14 million being covered by Emory University and the Hawks funding $36 million. Emory University will then provide a ground lease to the Hawks for the practice facility.
That $36 million is where the city of Brookhaven comes in to play as the sixth man for the Hawks.
To secure the deal to have the Hawks and Emory located the facility in Brookhaven, city officials agreed to offer the Hawks a $36 million tax abatement. That means when the building is completed, the Hawks will transfer ownership of the building to the Brookhaven Development Authority – and because the DA is a governmental agency, it is not required to pay taxes.
“It was a use it or lose it kind of situation,” Ernst said about the tax abatement.
To have a tax abatement, the Development Authority has to own the land, Ernst said, because government agencies don’t pay taxes.
In turn, the DA then issues a $36 million bond that is purchased by the Hawks, he explained. “There is no debt. The building is the only collateral,” he said. “This is the exact opposite of the Skyland deal – this is not a revenue bond.”
In return for the tax abatement, the Hawks will pay the DA $302,900 a year for 15 years. The deal in turn saves the Hawks $302,900 in taxes.
This is a 100 percent tax abatement, Ernst said. Without the abatement, the Hawks would have been paying more than $600,000 a year in taxes.
Ernst also said that had Emory and the Hawks decided to build in Executive Park with no assist from the city of Brookhaven, the city would have only received about $35,000 a year in taxes – the rest would have gone to county and state governments.
Marietta was also being considered for the Hawks to locate a new practice facility, Ernst said, and there was also the chance the Hawks could have gone with Decide DeKalb, a county development authority. If the Hawks had gone with either of those, the city of Brookhaven would have gotten nothing, Ernst said.
What happens if, for some reason, the Hawks default on the $36 million bond? Ernst promises the city will not be caught holding the ball.
The Development Authority only has the title of the building, not the land because Emory owns the land, he explained. Should the Hawks default the DA would transfer the building back to the Hawks and through “clawback” agreements, the city would recoup all back taxes, he said.
How to spend the $302,900 coming into the city’s coffers over the next 15 years is something city council members will be considering. Ernst said he hopes it can be used in the area where the development is taking place, for improvements to traffic, for example.
Ernst plans to host a town hall on Thursday, April 28, at 6:30 p.m. at Montclair Elementary School, 1680 Clairmont Pl NE, to address citizen questions about the facility and its impact on Brookhaven.
How it the deal began
The first meeting between city officials and the Hawks and Emory took place in early February.
Councilmember Joe Gebbia, who represents the district where Executive Park is located, said he put together the meeting at City Hall with Emory’s top management to fulfill part of the vetting process necessary for both sides to candidly discuss what a potential purchase of Executive Park would mean.
There were two key take aways from this meeting, he said.
“First, they informed us they would not seek tax-free status. This condition was essential because our long-term validation for the original annexation was always predicated on full and taxable redevelopment of Executive Park,” Gebbia said.
“We planned for a seven-year period before we would reach that phase, and now with this … purchase we would minimally be on target but most likely well ahead of schedule,” he said.
Second, Gebbia said he presented the positive developments occurring in Brookhaven and particularly along the Buford Highway Corridor, including: the advent of the Peachtree Creek Greenway, the current commissioned study to review mass transit options from the Brookhaven MARTA Station to Executive Park, the completed Buford Highway Economic Redevelopment Study, the complementing announcement of Children’s Health Care of Atlanta building their new corporate headquarters across the street, police coverage and response time, the completed redevelopment of Regency Plaza (formerly Loehman’s Plaza) offering many amenities to service Executive Park, and the prompt service from local form of government.
“The Emory management team was also doing their vetting and trying to decide if the purchase of Executive Park in our city was conducive to their growth plans — and I can tell you they walked away very happy,” Gebbia said.
“The combination of Emory buying Executive Park and the Hawks aligning with them to create a world class sports medical facility puts Brookhaven in an unbelievable position,” he said.
The flow over impact on Buford Highway will be unavoidable, Gebbia said, but still very positive. He said he is already getting inquiries from high-end hotels interested in moving into this part of town and that he expects to hear from many more entities in the near future.
“What I am most proud of is having put the original deal together that enabled Brookhaven to annex the east side of I-85,” Gebbia said.
“I went out on the limb — risking political legitimacy — and had to work hard to convince several of my fellow council members. But when it was all said and done, I knew the long-term benefits to Brookhaven would be undeniable,” he said. “It’s a proud moment to see these new developments coming to fruition in such a short period of time, and I am very thankful to my fellow council members, current and past, for their dedication to provide thoughtful leadership to our great city.”
Brookhaven an ‘NBA city’
There is no specific date when the Hawks and Emory will break ground but it is safe to say early summer because the funding is already set up. The building is expected to be completed in time for the 2017-18 season.
Also as part of the Emory and Hawks deal with the city, the Hawks will be renaming a road in Executive Park. What that name will be and what road is being renamed is not being disclosed.
“We are saving it for our big reveal,” said Hawsk spokesperson Garin Narain.
The basketball operations staff relocating from Philips Arena to Brookhaven includes eight coaches, 15 players, five trainers, 10 support staff, the 15 members of the general manager and his staff. “People who report to the President of Basketball Operations and head coach will all be moving to Brookhaven,” Narain said.
Ernst said a TV station will also be located on site of the new practice facility with the team’s reporters clearly being defined as reporting from Brookhaven, Ga., giving the city some cachet.
The 90,000 square-feet privately-funded facility will combine the Hawks’ training facility and Operations Department with 30,000 square feet dedicated to Emory sports medicine facilities, the first such facility in the NBA. Emory also gets naming rights to the facility.
“I’m glad the Hawks realized they needed the city of Brookhaven to win a championship,” said Ernst at the press conference. “Brookhaven is now an NBA city.”
Atlanta Hawks CEO Steve Koonin said at the April 5 press conference “today the Atlanta Hawks got better.”
The state-of-the-art facility will be able to attract and retain great talent to Atlanta, he said.
For Hawks Coach Mike Budenholzer, the news of the facility means putting the team on a more level playing field with other NBA teams.
“Collectively, we couldn’t be more excited about this partnership,” he said. “When we told the players — it was big. This puts us at a more competitive level.”
Dr. Scott Boden, director of the Emory Orthopedics & Spine Center, said Emory and the Hawks “looked at this venture through a different lens than any other NBA team” by combining the practice and training facility with the Emory sports medicine center.
Hawks owner Tony Ressler said it was just over eight months ago that a partnership between Emory University and the NBA team was started.
“We knew Atlanta was a great market … we knew we had a great coach and team, we knew that the Hawks had superior management and staff,” he said. But at the same time, the need for a top-notch practice and training facility was necessary. “This 90,000 square-foot facility will put us in the position to be a championship caliber team,” he said. “This is a very exciting day in Atlanta Hawks history.”