Carter's, Inc. - How Consolidation Plan Hinged on Securing New Space Fast

Challenge

Carter’s, Inc. (NYSE:CRI), the largest branded marketer in the U.S. of apparel exclusively for babies and young children, wanted to consolidate its retail store and financial operations, moving its Midtown Atlanta and Connecticut offices to the upscale Buckhead neighborhood of Atlanta. To do that, Carter’s needed expert legal help in negotiating an agreement to lease 224,000 square feet, and it had to complete the deal quickly. Carter’s called on AGG.

Approach

Phil Skinner commenced work on the letter of intent for the transaction in late September 2012. The client wanted to complete and announce the transaction prior to the 2012 Christmas holiday season. As a publicly traded company, and with client operations in Connecticut being merged into Atlanta as a result of the transaction, Carter’s conducted the project under a code name, Project Unity, with only a small number of Carter’s and AGG personnel fully apprised of the project scope. Because of Mr. Skinner’s excellent working relationships with the landlord and its brokers and counsel from prior transactions, the firm was able to negotiate the letter of intent and lease, and a lease termination agreement for the client’s existing Atlanta headquarters location, on an expedited basis. Working closely with the client and the client’s broker, Cushman & Wakefield, the lease documentation was completed and executed on Dec. 15, 2012.

Result

Carter’s had signed an agreement to lease 224,000 square feet at Phipps Tower, which the Atlanta Business Chronicle described as “one of the largest and most valuable leases ever completed in Buckhead.” In the paper’s “Best in Real Estate Awards” competition for 2012, the Carter’s lease is a finalist for “Office Deal of the Year.” The depth of the firm’s office leasing expertise, coupled with its excellent reputation and working relationships in the Atlanta office leasing community, enabled the deal to quickly move forward without sacrificing or compromising any goals or requirements. Phipps Tower in Buckhead will serve as the new national headquarters for the growing company. One of the benefits procured in the lease is signage rights on the parapet of Phipps Tower, poised above the busy Buckhead Loop, Phipps Plaza and the Ga. 400 corridor.