The Dunwoody Development Authority voted July 28 to approve $780 million in “inducement resolutions” for two separate development projects in the Perimeter Center, including two additional buildings as part of the State Farm hub and a new office building to be located in a corner of the parking lot of Perimeter Mall.
The Development Authority approved the resolutions to issue revenue bonds totaling $650 million for the State Farm project that will include two new office buildings that will also include restaurant and retail space built on the current Hammond Exchange building site. Construction on Phase 2 of the State Farm hub – the first phase is the building currently under construction on Hammond Drive – could start as soon as next year, according to KDC, developers for the project.
State Farm is expected to save some $48 million in property taxes from the city, DeKalb County and the DeKalb County School District over 17 years of the tax abatement, according to a financial analysis by Georgia Tech’s Enterprise Innovation Institute. The project is expected to bring in 2,200 new jobs to Dunwoody.
The authority also voted to approve the resolution to issue $130 million in revenue bonds for developer Transwestern to build a 16-story office building nearly directly across the street from the State Farm complex on a corner of the Perimeter Mall parking lot and adjacent to the Dunwoody MARTA station.
Transwestern will save approximately $14.5 million in property taxes over 12 years, according to Georgia Tech. The project is a speculative project — meaning no tenants are signed on to locate there — so how many jobs the project will bring to Dunwoody is uncertain. Transwestern estimates the project will bring nearly 2,500 jobs to the city.
The resolutions are not the final approval of the projects, said Michael Starling, director of Economic Development for Dunwoody and also the executive director of the Development Authority.
“Inducements resolutions are fairly broad and say we agree to talk and move forward on the project,” Starling said.
The corporations and development authority will eventually have to sign a formal “memorandum of understanding” that will outline the specifics of the tax abatements, he said. The Development Authority will likely meet again in October to go over the final MOUs, he said.
While the Dunwoody Development Authority has a close relationship with the city, it is its own separate entity and City Council approval is not needed to approve the tax abatements, Starling said.
Taxpayers are also not at risk with the issuance of revenue bonds, explained Carlianne Patrick, economics professor at Georgia State University’s Andrew Young School of Policy Studies.
“The public is not on the hook,” she said.