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Top Atlanta Creative Office Developers Merge to Expand Across Sun Belt

Third & Urban, Westbridge Partners Join Forces to Feed Appetite for Cool Spaces
June 29, 2018

Pictured from left: Pierce Lancaster, Chris Faussemagne and Hank Farmer.

Courtesy: Third & Urban.

Two of Atlanta's top creators of cool office space are combining to capture pent-up demand and develop creative workspaces from Virginia to Texas.

Third & Urban, which developed and sold Atlanta's loft-office Armour Yards, and Chris Faussemagne's Westbridge Partners have formed a new development entity that will retain the Third & Urban name. The new company plans to focus on adaptive reuse and urban infill projects across the Southeast and Texas.

Creative office space typically offers tenants more of an open office environment and areas for collaboration and amenities such as game rooms and dining areas usually not found in traditional set-ups where closed-door offices surround groups of cubicles. Creative offices tend to be located in walkable areas of a city surrounded by restaurants and retail and not suburban office parks that require driving to lunch.

Third & Urban said demand for creative office space is much higher than supply - and the demand is coming from large enterprises as well as smaller startups. Third & Urban estimates that creative office space accounts for less than 5 percent of Atlanta's overall office market, while it accounts for 25 percent of demand.

"That's a lot of runway for this type of space. It's hard to find. There's not a lot of it in a scaled platform," said Hank Farmer, who oversees development at Third & Urban. "There's demand for it anywhere you can create an authentic environment, and not just in intown markets."

Faussemagne said the rise of the creative class about 15 years ago, and its incredible growth since, is a major reason for the jump in demand for space other than traditional office space with cubes and corner offices. "People enjoy being in a more creative environment," he said.

Faussemagne is best known for his role in developing Atlanta's Westside Provisions District at 14th Street and Howell Mill Road. Westbridge developed the initial portion - the White Provision mixed-use project with Jamestown. Third & Urban's Pierce Lancaster and Hank Farmer worked at Jamestown before forming their own development firm in 2014.

Stockyards.
Photo Credit: Westbridge

Westbridge Partners also developed Stockyards, an adaptive reuse of three historic warehouses in West Midtown, with Federal Capital Partners. The project is 95 percent leased to several tenants, including three Interpublic Group companies: advertising firm Fitzgerald & Co., Momentum Worldwide and public relations company Weber Shandwick.

Stockyard's ability to land entities that are part of a global, publicly traded company is a testament to the comfort with, and desire for, creative office among large firms, Faussemagne said.

Denham Building.
Photo Credit: Third & Urban.

In July, Third & Urban will break ground on the Denham Building in Birmingham's Parkside District near Regions Field, home of Minor League Baseball's Birmingham Barons. Denham is an adaptive reuse of a two-story, 1920s-era warehouse that will comprise 80,000 square feet of office, 59 apartments, on-site retail shops and a rooftop restaurant.

Because Third & Urban is converting a former warehouse at Denham, the construction timeframe - 12 months - will be much quicker than building new offices from the ground up. This will help Third & Urban maintain its competitive advantage while other developers, including some of the country's largest, jump on the creative space bandwagon, Farmer said.

One of the large developers now building creative office space is Hines, which broke ground in May on T3 West Midtown, a new timber office building at Atlantic Station. Faussemagne said he expects others to start developing loft offices because of the demand and wider acceptance of it as a viable property type for institutional investors.

As for Third & Urban, the firm plans to grow in a calculated manner, Farmer said. It's currently scouting opportunities in Nashville, Birmingham, Charlotte and Tampa as well as in its hometown of Atlanta. "It feels like there's an opportunity that's not being met regionally," he said. "Austin and Los Angeles are five to 10 years ahead of Atlanta on creative office. But Atlanta leads it in the Southeast, and we're ready to leverage our position."

Tony Wilbert, Atlanta Market Reporter  CoStar Group   

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