Judge deals Atlanta Housing a setback in fight over land deal

By Maggie Lee

This story has been updated with more information from Integral and a correction. An earlier version stated that Egbert Perry was a defendant in the housing authority’s lawsuit. In fact, he was not named in the suit. 

A Fulton County Superior Court judge has handed a setback to Atlanta’s housing authority in its court bid to stop a controversial sale of its land at below-market prices.

Judge John Goger on Monday dismissed a set of complaints from Atlanta Housing against Integral Development and related entities, which touch on occurrences in 2011.

Some of the land from the 2011 deal is Downtown on Memorial Drive and overlooked by the state Capitol and the site of the new state judicial building. Credit: Maggie Lee

Some of the land from the 2011 deal is Downtown on Memorial Drive, overlooked by the state Capitol and the site of the new state judicial building. Credit: Maggie Lee

That means Integral and partners are a step closer to seeing the start of a transfer of land  for some $17 million — land that Atlanta Housing has said is worth $138 million. (Though part of the dispute touches on the lack of Atlanta Housing approval for an appraisal of the land.)

Atlanta Housing itself is a partner in the receiving entities. The land would be transferred into developer-controlled partnerships owned half by the authority and half by the development team.

Back in 2011, the city authority inked a deal that gave Integral the option to purchase some 79 acres of public land across the city in the future. The land is near four mixed-income developments that Integral itself built for the city.

The deal doesn’t require Integral to build below-market-rate housing on the new land. In fact, housing people with a mix of incomes side-by-side is a necessary part of a theory that it’s a bad idea to sequester low-income people in certain buildings or neighborhoods. And not only that, but that the nice mixed-income developments like those Integral built bring great property tax value to the city.

Integral characterizes the land as the final phase of the developments they’ve already built.

But in 2017, after Integral moved to exercise those options to buy adjacent land, the authority and its new boss took the company to court, making several arguments, including that the sale is not good public policy.

At the time in 2017, Atlanta Housing CEO Catherine Buell said that her office wasn’t a land bank for private developers to buy land at rock-bottom prices. She said that allowing a developer to purchase authority land to “build condos for the wealthy” exacerbates the housing crisis and pushes low-income people further into the margins of the city.

But back in the courthouse, Goger wrote that the Atlanta Housing board has repudiated the agreements in several ways, such as by voting against various legal steps necessary to sell the property. He wrote that in essence, the authority in court was merely seeking to test its defenses as to the enforcement of the agreements. That, he wrote, is not the purpose of the declaratory judgement act that the authority cited.

However, the judge is allowing the continuation of counterclaims by Integral seeking to get sales going. Integral and the related developer entities countersued Atlanta Housing for breach of the contract, and to conduct the sale of the land to the to-be-formed 50-50 joint ventures.

A spokeswoman for Atlanta Housing, reached by phone Monday, said authority lawyers were reviewing the judge’s order.

Egbert Perry

Egbert Perry, founder and CEO of the Integral Group, in a conference room at his company’s headquarters in November. Credit: Maria Saporta

In a statement on Tuesday, Integral CEO Egbert Perry wrote that “because the truth has always been on our side — and in the public record — we expected that our rights would be vindicated in the courts and on Monday, April 30, the court agreed.”

He wrote that the company intends to pursue its counterclaims vigorously and seek all legal and equitable relief available.

“We look forward to continuing the important revitalization efforts we commenced almost 20 years ago in these four communities and helping to address some of the many housing affordability challenges and opportunities facing Atlanta,” Perry wrote.

The land is in four places, adjacent to Integral’s master-planned communities of Auburn Pointe and Capitol Gateway (both fairly near King Memorial MARTA), plus CollegeTown (near Morehouse) and Villages at Carver (in South Atlanta.)

The order came just about a week after the city of Atlanta dropped its own lawsuit against Perry, Integral, related companies, and former AHA leader Renee Glover.  That suit alleged that Glover set up the 2011 land deal for Perry, in exchange for his helping her get a seat on the board of Fannie Mae, the government-controlled mortgage company.

 

Maggie Lee is a freelance reporter who's been covering Georgia and metro Atlanta government and politics since 2008.

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