With up to 46 stories and a dramatic, back-lit opening near the crown, 50 Allen Plaza promised to change the city's skyline and further cement Allen Plaza’s position as downtown Atlanta’s hottest new address.
But construction of the office tower, planned during the height of the real estate boom, never started as the local economy nose-dived.
Now the project’s lender has started foreclosure proceedings on the property, a 1.6-acre tract located on the northern edge of downtown, after the developer, Barry Real Estate, apparently failed to pay on two loans worth a total of $9.5 million.
Barry Real Estate's chairman, Hal Barry, said he still hopes to work a deal with lender BB&T to avoid foreclosure. He said he' s devastated at the possibility of losing the 50 Allen Plaza property, which would make it difficult to complete his goal of bringing a dense, walkable urban center to downtown Atlanta.
"This is the tenderloin, the best block, of Allen Plaza," he said.
It's the latest high-profile Atlanta project to fall into trouble. Greenbriar Mall in southwest Atlanta has been threatened with foreclosure over the past few months, with another foreclosure notice filed this week. Mall co-owner Charlie Hendon said he's close to working out new terms with his lender to avoid the auction block.
Meanwhile, downtown Atlanta’s Equitable building was foreclosed last year, while the Mansion on Peachtree building in Buckhead faces possible foreclosure in February. Construction of Ben Carter's ritzy Streets of Buckhead retail district has been delayed.
According to a legal notice filed this week, North Carolina-based BB&T plans to auction 50 Allen Plaza on Feb. 2. BB&T took over the loans when it acquired failed Colonial Bank of Montgomery, Ala., last year. Barry said he plans to meet with BB&T officials next week in hopes of working out an extension.
Barry's Allen Plaza project is a planned nine-block complex of office towers, condos, retail space and restaurants. Several phases have been completed, including the sparkling W Hotel & Residences and two office buildings housing the headquarters for Southern Co. and the Atlanta office of Ernst & Young. The project is also home to two high-end restaurants, BLT Steak and French American Brasserie.
Barry said he hadn't started building 50 Allen Plaza because he hadn't signed an anchor tenant.
The two loans for 50 Allen Plaza were made in July 2007, just months before a deep recession took hold.
The metro area faces a huge glut of office space as businesses have closed or scaled back amid the economic slowdown. Experts say it will take many years to fill the available empty space, making it tough to justify building new office buildings like 50 Allen Plaza.
Greenbriar Mall, which opened in 1965, was one of the region's first enclosed malls and helped pioneer the food court concept. But the mall fell on hard times, losing large tenants like Cub Foods and a Magic Johnson movie theater in recent years.
Hendon, the mall's owner, said he recently signed a lease with Super Beauty Depot to fill the vacant Circuit City building.
"It appears as though I have something worked out" with his lender, Hendon said. " I believe well have it all wrapped up by the end of the month."
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