The Dunwoody Development Authority has approved an estimated $2.3 million tax break for developer Branch Properties’ mixed-use project in the heart of bustling Perimeter Center.

The DDA approved the tax abatement at its Dec. 11 meeting for Perimeter Marketplace, an approximately $38 million development fronting Ashford-Dunwoody Road between Meadow Lane and Ashwood Parkway. A detention pond popular with Canada geese, a P.F. Chang’s restaurant and two vacant restaurant spaces are currently on the 10-acre property. The tax abatement ensures the project approved by the City Council in June moves forward, said Economic Development Director Michael Starling.

An illustration of the planned Perimeter Marketplace mixed-use development along Ashford-Dunwoody Road. (Special)

“Branch was very clear they were not going to move forward without the abatement,” he said.

The DDA also approved a resolution to begin negotiations to issue $45 million in tax-exempt revenue bonds to fund construction.

Members were initially hesitant to approve the tax break on the relatively small project, as the authority previously had approved only a handful of previous tax abatements for office towers. For example, the DDA has approved $48 million in tax breaks for the massive State Farm complex being built on Hammond Drive.

Perimeter Marketplace includes a grocery store, restaurant and retail space, a RaceTrac gas station and future plans for a hotel. The project requires filling the pond to build a surface parking lot.

The DDA has never in its 10-year history approved tax breaks for a mixed-use project, members noted at a November meeting. They also discussed concerns they were hearing from the public about how tax abatements may impact the DeKalb County School District.

DeKalb Schools is currently struggling to find money and ways to alleviate overcrowding and maintain aging school buildings. When the DDA approves a tax abatement, that means less taxes to the city, and less taxes to the school district and to the county.

Branch estimates the project when finished will add $77 million a year in sales taxes, and that is “10 times more than what the sales of the three restaurants when they were all open,” Starling said of the existing property.

“That helps the city and the school system,” he said. “There’s no doubt the impact on schools in all our deals is a huge concern, but we also … make sure they are not negatively impacted. “The school system is not going to lose money,” he said.

The Center for Economic Research and Development at Georgia Tech conducted a fiscal impact analysis on the project. The report says the project is expected to create 370 jobs with average annual wages of nearly $36,000. The study also says the project would create 68 new households in DeKalb County, including 12 in the city.

Branch would spend nearly $5 million in public infrastructure as part of Perimeter Marketplace, including a road connection from Meadow Lane to Ashwood Parkway and construction of a portion of the long talked about Ashford-Dunwoody “commuter trail.”

The commuter trail for cyclists and pedestrians is intended to connect Dunwoody MARTA riders to their jobs in busy Perimeter Center. It was approved as part a Perimeter Community Improvement District’s trail system master plan in 2014.

The first phase of the commuter trail includes separated pedestrian and bicycle facilities in front of Perimeter Mall with construction expected to begin in 2020.

Starling said Branch’s investment in sidewalks on Ashford-Dunwoody Road as part of the commuter trail system impressed DDA members and played into their decision to approve the tax abatement. Otherwise, the trail would be an out-of-pocket expense to the city to build in the near future, he said.

Adding a grocery store to the area as well as more restaurants also benefits the city and property owners, Starling said.

“Overall, although this project is not as dense as it could be, it continues the trend of infill development … and fulfilling the need for a more urban, walkable district,” Starling said.