CTO Realty Growth Inc. of Winter Park, Fla., has paid $96 million for The Collection at Forsyth, a 560,000-square-foot lifestyle, mixed-use development in Atlanta’s Forsyth County submarket. The seller’s identity was not revealed.
The 57-acre complex, which opened in 2008, is slightly over 80% occupied, with retail tenants including Academy Sports, AMC Theatres, Ted’s Montana Grill, DSW, and Barnes & Noble.
According to Matthew Partridge, CTO senior vice president, CFO & treasurer, The Collection at Forsyth also features complimentary office tenants such as Regus, as well as medical tenant Children’s Healthcare of Atlanta Urgent Care Center.
To allow for any future sales of income assets by CTO, the acquisition was structured as a reverse like-kind swap.
According to reports, the purchase price represents a going-in cap rate that is higher than the range of CTO’s existing projection for first cash yields.
CTO President & CEO John Albright stated in a prepared statement that the transaction was priced significantly below replacement cost, with prospective upside from repositioning the property through targeted capital investment to increase the overall tenant mix and lease the existing vacancy. He noted that part of the latter will entail finding a new grocer to take over a vacant outparcel formerly occupied by Earth Fare.
The location is in one of Atlanta’s most affluent submarkets, with Forsyth County expected to have an extraordinary population growth rate over the next five years, according to CTO. The submarket already has Georgia’s highest median income of any county.
A big mixed-use project announced by Fuqua Development for a site right across Ronald Reagan Boulevard from The Collection at Forsyth is also planned for the region, according to the business. The Fuqua project will include retail and restaurant space, as well as a hotel and self-storage facility.