By Maria Saporta
Friday, May 4, 2012
The downtown home of Atlanta Life Financial Group may soon be owned by Georgia State University.
Georgia State University will seek approval from the Georgia Board of Regents at its May 8 meeting to purchase both the Atlanta Life property and the building that houses The Integral Group LLC development firm for $10 million, according to Kerry Heyward, GSU’s attorney who oversees real estate transactions for the university.
If approved by the Regents, Heyward said, it is expected the sale would close in July and the university could move into the building as soon as a couple of months later.
The five-story building on Auburn Avenue between Courtland Street and Piedmont Avenue has been the home of one of Atlanta’s premier African-American companies since 1980. The company was founded as a life insurance enterprise by Alonzo Herndon 107 years ago.
It is a significant change for Atlanta Life, which has been located on that block since 1920. In fact, the former home for Atlanta Life still stands, but the neo-classical building is boarded up and vacant.
Egbert Perry, who is board chairman of Atlanta Life and CEO of Integral Group, said the life insurance company and its related businesses are using only one and a half floors of the 105,000-square-foot building.
“We don’t need to be in the real estate business,” said Perry, who has chaired the board for the past two years. “My personal view is that the building should have been sold five years ago.”
William Taggart, president and CEO of Atlanta Life Financial Group, said the goal is to reposition the company for growth, and the building has been a significant expense for the firm.
“The cost of maintaining this building is very high,” Taggart said. “This building was erected 30 years ago to support a totally different kind of business. We didn’t have asset management or investment banking.”
The new profile of the company has meant that it has a smaller work force — about 100 employees across its three lines of business.
“The space is not functional,” Taggart said. “It doesn’t make a lot of business sense to keep it.”
Taggart said that by selling the building and moving to another location the company will eliminate expenses and “have a measurable impact on the bottom line.”
The proceeds from the sale also will help “strengthen the overall balance sheet” of the company. “It will help position us for future growth,” he said.
Both Atlanta Life and Integral are looking to move to another location in downtown Atlanta.
For GSU, both pieces of property are consistent with the university’s master plan.
“We are interested in acquiring the property, and we are working with the sellers,” said GSU President Mark Becker. “It fits right into the growing footprint of Georgia State University. It’s consistent with our plans.”
As currently envisioned, the Atlanta Life building would become the new home of GSU’s Honors College — offering talented and motivated undergraduate students an opportunity to be part of a small college yet have access to any of the university’s 62 undergraduate majors as well as other enhanced programs and services.
Currently, the Honors College enrolls about 1,200 undergraduates who have a high grade point average and have scored well on the SAT or ACT.
The Integral Group building likely will be home to the university’s student housing services. The building, at 60 Piedmont Ave., is along the main corridor of GSU’s student residences. By relocating that office to Piedmont, it will free up office space in the center of the campus, Heyward said.
The two properties also sit in between two other significant acquisitions by the university or its foundation.
GSU has purchased the Citizens Trust building, another financial institution with deep roots in the African-American community, which sits across from the Integral property on Piedmont.
Citizens Trust, however, continues to operate out of that building with a lease that goes through September 2016, and the bank has another five-year option on its lease.
The GSU Foundation also acquired the SunTrust Tower building five years ago. The former bank tower sits to the west of the Atlanta Life building and overlooks Woodruff Park. All SunTrust employees are supposed to be moved out of the tower by the end of May.
At that point, the university will lease the building from the GSU Foundation, and it will restore the building several floors at a time. The SunTrust Tower will house offices for GSU’s College of Arts & Sciences. Heyward said the building will continue to have a SunTrust branch on the street-level floor.
As to the Atlanta Life building, Heyward said it is “pretty much move-in ready for the university.” Part of the building’s appeal is that it has a 250-seat auditorium, a dining hall and a lobby that can serve as an event space as well as parking on the property. That makes it ideal to become a GSU welcome center as well as an alumni center.
Although Taggart said it makes financial sense to sell the Atlanta Life building, he did acknowledge that there are mixed feelings.
“It’s a very emotional decision to sell this building and get a new corporate home,” Taggart said. “There’s great sentimentality. Walking into this building you can hear the echoes of the people who have worked here in the past. I think they are encouraging us to do what we need to do to make sure Atlanta Life is a viable company. We are trying to sure Atlanta Life is here for another 100 years.”