Sandy Springs authority approves memorandum to fund 111 parking spaces, 10‑year tax abatement for Mount Vernon mixed‑use project

The Sandy Springs Development Authority on a voice vote authorized a memorandum agreement that ties a 10‑year tax abatement to payments that will help fund 111 parking spaces in a 646‑space parking garage and set aside streetscape funds for a new mixed‑use development on an 8.1‑acre site formerly owned by Sandy Springs United Methodist Church.

The development authority approved the memorandum during its June 2025 meeting as the city prepares to close a contract of sale with a joint venture led by Trammell Crow Company and Third & Urban for a mixed‑use project the authority says will include about 386 residential units (356 stacked‑flat apartments and 30 townhomes) and roughly 18,000 square feet of retail and restaurant space.

Why it matters: the agreement is structured so the tax abatement — a 10‑year schedule that begins with a 50% reduction in property tax in year one and phases down by 5 percentage points each year — generates payments in lieu of taxes that the developer will direct to the city and the development authority to offset the city’s up‑front investment in the parking and public improvements.

Key terms and money flow

City purchase and escrow: the public facilities authority will acquire an easement for 111 spaces under a 50‑year term; the transaction contemplates a purchase price in the city’s budget of $3,312,000 for those 111 spaces (about $30,000 per space). The authority will place roughly $3.6 million ("approximately or a little bit less," per staff) into an escrow account at Truist Bank to pay the contractor for construction of the garage on a percentage‑of‑completion basis, with third‑party inspections and invoice review required before draws.

Streetscape fund and contingency: the memorandum also sets aside $900,000 for road and streetscape improvements — traffic calming, crosswalks, sidewalks and landscaping — to be determined after a traffic study. Staff said there is an additional contingency/reserve (a 5% construction reserve was described in the discussion) to address possible overruns; the city’s total capped exposure discussed in the meeting was described as a fixed maximum investment figure for the project (final contract exhibits in staff materials show a not‑to‑exceed cap that staff said had been finalized during the packet review).

Tax abatement and repayment: under the memorandum the developer will receive the county tax incentive; the developer will then make annual reimbursement payments to the parties named in the memorandum equal to the tax savings generated by the abatement until a stated dollar cap is reached. Counsel summarized the repayment mechanism as the developer paying the authority an annual amount tied to the abatement until the agreed dollar amount has been reimbursed.

Ownership, operations and buyout: the PFA/city will own the 111 spaces by easement; operating costs for the garage will be shared pro rata. The city’s share was described as 17.2% of operating costs (111 of 646 total spaces). The agreement includes a buyout provision equal to two times the city’s parking investment (stated in discussion as approximately $6,624,000), subject to credits such as payments already received in lieu of taxes and parking revenue, per the contract language described by counsel.

Scope of the development authority’s role

Jim Woodward, outside counsel, advised the authority that its role is limited to approving the tax incentive and the memorandum that collects developer reimbursement payments generated by that incentive. "Basically, the only role the development authority has in this is providing tax incentive, to Trammell Crow," Woodward said during the meeting. He and staff confirmed the public facilities authority — a separate entity — will execute the parking easement and purchase agreements directly with the developer.

Questions and clarifications raised at the meeting

• Staff and board members asked how the city will replace the 105 surface spaces that will be lost when construction begins; staff said two city‑owned lots at nearby properties could provide an estimated 50–60 additional spaces temporarily, and that the new 111‑space easement is intended primarily to replace the lost church parking.

• Board members asked whether the city bears exposure for construction overruns. Staff said the city’s investment is capped per the agreements and that cost overruns on the garage would be allocated on an 83%/17% basis unless a specific overrun could be attributed to the city’s 111 spaces; disputes over invoices will be handled through an established dispute process that allows the city to withhold disputed amounts while paying undisputed sums.

• Board members also raised whether a portion of streetscape enhancements are developer obligations. Staff clarified that any work paid from the authority’s $900,000 streetscape bucket would be in addition to developer‑required improvements identified in the developer’s traffic study and site permit obligations.

Vote and next steps

The board voted to authorize execution of the memorandum for EA‑2025‑11 after a motion from Tasha Battle and a second from a fellow board member (motion passed by voice vote; individual roll‑call vote totals were not recorded in the public discussion). Staff said the project team is targeting a closing later the same week and that related votes by the public facilities authority and city council were scheduled for the same day.

Staff and counsel also said the project team had resolved a separate concern regarding a nearby City of Atlanta water tower and that the city would apply its standard development regulations and the requirements of forthcoming traffic study results to the project.

The authority noted next administrative steps: final execution of the memorandum, escrow funding, and coordination among the development authority, the public facilities authority and the developer on construction draws, inspections and the traffic study that will determine final street and pedestrian improvements.