Menlo Equities to buy Vacant Lincoln Property Office Development

Menlo Equities could buy the commercial portion of a development on Atlanta’s Westside in a transaction that looks painful for Lincoln Property Company.

The Silicon Valley-based firm has agreed to acquire the vacant office building at Lincoln’s Echo Street West development, at Donald Lee Hollowell Parkway and Northside Drive, the Atlanta Business Chronicle reported.

The project, valued by Fulton County at $154 million, was developed during the pandemic, targeting the technology sector. However, a shift in office demand and downsizing by tech companies left the property unoccupied.

Dallas-based Lincoln was approved for $7 million in property tax breaks over 10 years to build Echo Street, backed by a $135 million construction loan from Bank OZK, which is scheduled to mature in April.

An industry insider predicted that Menlo Equities would pay about $200 per square foot for the 305,000 square foot building, the outlet reported. That comes to $61 million.

Whatever the price, it likely will close “at a meaningful discount,” according to JLL.

Menlo Equities, known for acquiring office space in tech-centric markets, will adhere to the pattern on Echo Street West, which is near the campus of Georgia Tech, with its expanding Science Square and Arts Square projects.

This would be Menlo Equities’ second acquisition in Atlanta, following its 2020 purchase of an office tower, the Allen Plaza at 30 Ivan Allen Jr. Boulevard Northwest in Downtown, for $90 million, or $339 per square foot.

While the sale is not yet finalized, the Development Authority of Fulton County was scheduled this week to discuss the transfer of bonds related to the project, though Lincoln postponed any action to allow for ongoing negotiations.

The larger Echo Street West development is to include retail, apartments, event space and 3.4 acres of open space, according to Lincoln’s website.

—Rachel Stone