Atlanta Distressed Properties Include Condos and Schools
Atlanta distressed properties have crept into almost every sector of real estate in the metro area, aside from the single-family subsector, as condos are getting sold off at auctions, stores and offices are getting foreclosed and schools are getting closed.
Court buildings could even taste the sting of foreclosure if the proposal of a Georgia legislator to cut 19 court judges to reduce state expenses is approved.
Among the condo projects in foreclosure is the 48-story Trump Towers condo tower project, which is being developed by Atlanta firm Wood Partners and New York firm Dezer Properties in partnership with Donald Trump. It is not clear, however, to what extent Trump is involved in the project. In another Florida case involving Trump, complainants found out later that Trump was not the lead developer.
The condo building was set to be completed this year, but construction did not start in 2007 as planned because of the housing downturn. It was planned to fill the demand for condo units priced between $400,000 to $1 million, but after 90 units got sold, sales dried up as the crisis started. Analysts said that the project would push through, but not in the near future as the city is currently struggling from the oversupply of condos and from other types of distressed properties in Atlanta.
The real estate crisis has also affected school districts, and ultimately vacant school buildings will be among the problems of education officials. According to the board of the DeKalb County School System, school district officials are planning to close four to 12 of its 147 schools because of an anticipated budget deficit of $88 million.
When they came to know of the plan, hundreds of parents staged a protest and claimed that the schools on the short list are in areas heavily populated by poor families and African Americans.
Tom Bowen, chairman of the school board, explained that many of the listed schools do not meet the required enrollment level of 450 students. He said that the state government cuts funding for districts that have large numbers of unoccupied seats and that closing some schools could actually help the school district obtain more money for school improvements.
In the first months of this year, the trend for both Georgia and Atlanta distressed properties were upward. In February, a total of 12,177 foreclosures were posted statewide, marking an 8-percent jump from January and a 20-percent increase from February last year.
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