Charlotte will bat lead-off in a national high-speed rail vision road show – a series of workshops in seven U.S. cities put on by the Federal Railroad Administration.

The workshop – the only one to be held for the Southeast Corridor – will be 1-4:30 p.m. at the Renaissance Charlotte Suites Hotel, 2800 Coliseum Centre Dr. (off the Billy Graham Parkway).

Atlanta’s skyline will likely remain unchanged for the next decade or so.

“When will we see the next 50-story building in Buckhead? I would guess that if we see another 50-story building there in the next 10 years, I would be surprised,” said Clark Gore, market director of Jones Lang LaSalle Inc. “The skyline is impacted by where we are in the recovery.”

These is substantial risk in speculative buildings right now and developers are only going forward with projects that have a significant amount of pre-leases in place. There is even talk that LEED certification for buildings will practically be a prerequisite going forward. This makes sense because LEED projects typically are more expensive on the front end, but the back end payoff would appear large because of the points scored for location, reuse of materials and, generally, a more thoughtful approach to a project. LEED certification for buildings seems to be a good litmus checklist for going forward on a project, regardless if the developer’s intention is to be “green”.

As Brian Leary, vice president of design and development for Atlantic Station LLC, points out, these types of projects won’t be exclusively inside the perimeter.

Areas that already offer infrastructure and allow for more dense development will be well-positioned to take advantage of an economic recovery. Those locations don’t just include prominent submarkets such as Buckhead, Midtown and Perimeter Center, but downtowns in Suwanee and Duluth and other suburban areas that offer an opportunity for a higher quality of life.

Another area of strength for the Atlanta market will be the industrial distribution hubs that have been springing up along the interstate corridors for a number of years now. That trend is expected to continue as the Port of Savannah expands.

“When it settles down, we’ll start seeing growth because there’s no new space out there to compete,” said Dave Watson, senior vice president at Grubb & Ellis Co.

It’s also likely to help make industrial real estate here attractive to foreign buyers seeking solid investments.

“There’s going to be a glut of distressed sales and some other opportunities,” said Mike Gray, senior vice president with Panattoni Construction Inc.

Currently, Atlanta’s industrial market has a 17.4% vacancy rate.

So, we’re likely to see, perhaps, something that I discussed in an earlier blog – a move towards social land development. President Obama signaled that he is in favor of this trend. Although, I think his view is overly limited to existing urban centers and fails to see the thriving and successful suburban town centers that are also being created.

In my next blog, we’ll explore the infrastructure side of the future of Atlanta. Infrastructure will be the key to many city’s success or failure in the coming decade. Failure to address the key infrastructure needs of a city will cause it to die. Fortunately, there are some strong voices in metro Atlanta for addressing the area’s sorely lacking infrastructure.

Atlanta is no exception to that. People have been moving back ITP for awhile now. Gwinnett County is seeing a number of its cities develop or redevelop town centers.

Leading the way is Lawrenceville and Emory Morsberger’s efforts to rebuild and revitalize the county seat. Suwanee, which continues to gain national recognition for its livability, has built, and continues to build, what is likely metro Atlanta most ambitious development of a downtown and park system. Other cities in Gwinnett, like Norcross, Sugar Hill and Snellville, are also moving in similar directions, some with more success than others.

Mr. Brooks states that he would like to see the stimulus money that Barack Obama wants to spend on infrastructure spent in helping to build these downtowns rather than projects that are ready to go, just for the sake of getting money into the system.

Barack Obama has said that he would start an infrastructure project that will dwarf Dwight Eisenhower’s highway program. If, indeed, we are going to have a once-in-a-half-century infrastructure investment, it would be great if the program would build on today’s emerging patterns. It would be great if Obama’s spending, instead of just dissolving into the maw of construction, would actually encourage the clustering and leave a legacy that would be visible and beloved 50 years from now.

I think Mr. Brooks’ idea is a good one – stimulus money going into assisting cities build or revitalize downtowns is a noble goal. However, it would take years of planning in order for it to be done correctly. Mr. Brooks laments that the money will go to perpetuating the current modes of transportation.

But alas, there’s no evidence so far that the Obama infrastructure plan is attached to any larger social vision. In fact, there is a real danger that the plan will retard innovation and entrench the past.

In a stimulus plan, the first job is to get money out the door quickly. That means you avoid anything that might require planning and creativity. You avoid anything that might require careful implementation or novel approaches. The quickest thing to do is simply throw money at things that already exist.

Unfortunately, our infrastructure is so lacking in maintenance that we need huge investment just to get it back to an acceptable level. We are years, perhaps decades, away from truly getting to any sort of renaissance in social land development. As Mr. Brooks points out, prior to the recession, we were making great strides as the market moved in this direction.

There are certainly aspects of President-elect Obama’s plan whose outcomes are rather dubious in nature. Putting computers in classrooms, fixing school buildings, retrofitting government buildings to make them more energy efficient. (Although, I have to say, I’d rather see tax dollars go there than to propping up failing companies.) However, fixing the country’s existing infrastructure and allowing states to move forward on transportation projects that are likely desperately needed should be the first focus. As the war in Iraq winds down and, if we’re smart enough not to dump billions in private companies, Mr. Brooks idea would be a great starting point in perhaps moving us where we were already going, just a little quicker, to more social land development.

The first bit of positive news comes in the form of the residential market not doing as bad as expected in October. Yes, we have gotten to the point where good news is things aren’t as bad as predicted, but at least that’s better than being worse than predicted which has happened all too often this year.

James Fleming, Cousins Properties’ executive vice president and chief financial officer, made some interesting comments in a recent AJC article. He gives some insights on where they see the current market and the future in Atlanta.

Fleming said, “We’re starting to see some broken retail deals. We think we may see some office deals that are broken, too. Those could be pretty interesting. We’re going to take a hard look at those things.

“We’ve got two of our people doing nothing but looking at acquisitions.”

Only “compelling” residential projects would interest Cousins, and so far they haven’t presented themselves, he said.

But Cousins could end up doing a joint venture with a home builder, Fleming said.

“If you believe the demographics, at some point that’s going to turn around,” Fleming said of the depressed residential market.
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Emory Point, a mixed-use joint venture with Gables Residential, is on hold, but Fleming said “that still looks to be a very favorable project. That’s an infill location with a lot of demand and really no competition.”

Overall, however, “I don’t think we’re going to see large-scale development opportunities in the next 12 to 18 months,” he said.

An interesting story from Boston outlines how the Mayor intends to extend $40 million in loans to restart projects like office towers and retail developments. Like President-elect Obama’s desire, Boston’s Mayor wants to extend these federally backed loans to projects that can begin immediately.

In a similar vein, Georgia Governor Sonny Perdue intends to use the state’s high bond rating to attempt to stimulate growth.

Mr. Obama stated over the weekend that he intends to invest in the country’s infrastructure in the largest amount since the Eisenhower Administration. This is a critical component that the federal government has been ignoring for years, and arguably perhaps its most important duty behind national defense. The country’s infrastructure has been failing for years – its most glaring example was the tragic bridge collapse in Minnesota last year.

In 2005, the American Society of Civil Engineers graded the country’s infrastructure – and it earned a miserable D. In the three years since that report card was scored, they conditions of the country’s infrastructure has only deteriorated, so we’d be lucky to earn a ‘D’ if ASCE does another score. ASCE estimates that it will take $1.6 trillion over the next five years to upgrade the country’s infrastructure. That was in 2005 dollars, so with the further deterioration and inflation, we can expect that number to be closer to $2 trillion.

Mr. Obama has not said what level of investment he is proposing – that his advisors were “busy working, crunching the numbers, looking at the macroeconomic data to make a determination as to what the size and the scope of the economic recovery plan needs to be. But it is going to be substantial.”

The mere comment is a boon to engineering companies. The news of the plan caused publicly traded construction services’ stocks to increase. Many of them increasing dramatically – 30% and more. Jacobs Engineering, which employs more than 43,000 people, was up nearly 16% today.

Not shockingly, several governors (all but one, Governor Schwarzenegger of California, were Democrats) came out in support of the plan.

It will be interesting to see the bones of the plan – to see what kind of projects would actually be funded. Mr. Obama hinted at the projects, which would include roads, bridges and upgrading public buildings to make them more energy efficient. He also stated that the money would be “use it or lose it” in an attempt to makes states quickly deliver projects. Personally, I’m in favor of just about any plan that upgrades the country’s infrastructure.