Jacoby Development – Porsche Selects ‘Aerotropolis’ Site for New HQ

Challenge

Ford Motor Company operated for many years a plant in Hapeville, Georgia, next to the world’s busiest airport, Hartsfield-Jackson Atlanta International Airport. Ford approached Arnall Golden Gregory client Jim Jacoby, owner of Jacoby Development, about buying the 125-acre site. Jacoby had initiated development of the landmark Atlantic Station mixed-use community, a former steel mill site in Midtown Atlanta. Jacoby wanted to bring in joint venture partners to make the purchase and called on Arnall Golden Gregory to form the JV. AGG’s role grew as the project progressed.

Approach

Jacoby and several partners acquired “the biggest and best outparcel to the Atlanta airport,” with the idea of creating an “aerotropolis,” a mixed-use development linked to an airport. The Ford plant was demolished, but because the deal closed in 2008 at the beginning of the nationwide real estate downturn, the joint venture, Airport Station, LLC, elected to market the property for sale. AGG became general counsel to the joint venture, representing the joint venture in the disposition of the property going forward. Porsche Cars North America, seeking a new destination headquarters location next to the airport, approached the joint venture about purchasing part of the land. Porsche envisioned a high-visibility “experience center,” easily accessible to company executives and customers from all over the world, who could test cars on a new track. Porsche eventually purchased 56 acres and retained Jacoby as the developer of its new North American headquarters. AGG negotiated a very detailed, extensive purchase agreement and development agreement on the joint venture’s behalf. While that was going on, the City of Atlanta, owner of the airport, approached the joint venture about also buying part of the site. AGG represented the joint venture in its negotiations with the City of Atlanta for a 52-acre purchase and also negotiated a reciprocal easement agreement that governed the relationship between the City of Atlanta and the Porsche sites. Negotiations were further complicated by a host of other issues, such as renaming of roads, storage of rail cars and flight paths. AGG engaged with other counsel representing the parties involved to pull it all together.

Result

After several years of challenging work, the former industrial site is on its way to becoming a mixed-use aerotropolis. Porsche opened its $100 million headquarters with a test track, restaurant and other amenities in 2015. It is the largest investment Porsche has made outside Germany. Businesses, local governments, nonprofits and other parties formed the Atlanta Aerotropolis Alliance to work with community improvement districts to direct the area’s continued development.