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Herndon Square’s Master Development Agreement Amendments to be Considered by the Housing Authority

January 24, 2022

Recent changes in the marketplace have caused Atlanta Housing, Hunt Development Group, and Oakwood Development Group as developers, to revisit the business terms of the former Herndon Homes Public Housing site master development agreement and to negotiate revisions that will affect all four of the remaining future phases of the development program.

The Board of Commissioners of the Housing Authority will be reviewing the changes and request to amend the agreement during their January 26, 2022, regular meeting. Affordable Housing staff recommends approval of the revised terms, master plan, and funding commitments to complete the public infrastructure and move the residential development phases forward.

The resolution to be considered by the Authority include the following revisions and terms:

According to City documents, in 2017, the Housing Authority was initially authorized by the Board of Commissioners to enter into a Master Developer Agreement with Hunt Development Group and Oakwood Development Group to revitalize Herndon Square for a total estimated budget of $102,465,012. The agreement included the redevelopment of the 13-acre former Herndon Homes public housing site into a mixed-use, mixed-income community. Since that time, Program Manager Pennrose reported a lack of wiliness to invest in mixed-income developments with more than 20% market-rate units. In addition, they could not secure a retail grocer for Phase II despite significant outreach efforts to Publix, LIDL, ALDI, Kroger, and Walmart. According to presentation documents, while Publix, LIDI, and ALDI initially expressed some interest, they all had concerns about the lack of a standalone building and sufficient parking, inability to sell beer and wine given the proximity to a church, limited retail, and development activity in the area and that the current average income in the neighborhood does not meet their investment requirements.