[A sampling of photographs of the model homes in the St. Regis Residences, with interior design by Stan Topol, Suzanne Kasler and Patricia McLean. Images courtesy of the Tavistock Group.]
You may recall our feature of a few weeks ago on the re-launch of the residences at the St. Regis Hotel in Buckhead. In the course of writing about that story, we had the opportunity to get a closer look at the thinking behind the acquisition by the Tavistock Group and how they've gone about reintroducing some of the most expensive real estate in Atlanta back into a still-wheezing market. Our conclusion? The right buyer- with the necessary resources, expertise and patience- ended up with an iconic asset that exists in a class of its own in a still-maturing market. And based on what we've seen so far, Tavistock is likely to be both successful with its investment and an excellent steward for an institution that has become an instant classic in Atlanta.
The Tavistock Group functions as a kind of personal hedge / private equity fund for the British-born billionaire Joe Lewis, who made the bulk of his wealth as a currency trader. Tavistock's broad portfolio of investments includes sports teams, life sciences and energy companies, a restaurant group and a substantial collection of real estate. The St. Regis joins other Tavistock luxury resort properties like Albany in the Bahamas, Harmony Cove in Jamaica, and the Isleworth Golf & Country Club near Orlando, home to Tavistock's U.S. headquarters.
The acquisition of the St. Regis was driven by Tavistock's belief in the long-term viability of the Atlanta market, the value of the St. Regis brand (and the Starwood management contract) and the proprietary location of the hotel. There was also recognition that in addition to already being a one-of-a-kind asset, market dynamics dictate that nothing like the St. Regis will be built in Atlanta for a long while. Investors shopping for Atlanta commercial real estate assets in 2010 (particularly high-end hotel/condominium projects) had their pick of troubled projects that could have been had at extreme discounts: the Mansion on Peachtree and the W Hotel & Residences at Allen Plaza to name just two. But in opting for the St. Regis, Tavistock wasn't pursuing a 'distressed asset' per se. The hotel was successful from the get-go, and while 30 of the 53 residences remained unsold (following the abandonment of contracts and substantial deposits in the wake of the unpleasantness of 2008-2009), the project was far ahead of much of its competition.
Upon acquiring the St. Regis, Tavistock went about investing some $10 million in the building, landscaping and new model homes. They also took marketing and sales in-house for a complete overhaul (in addition to having a full-service advertising/design/PR operation, it happens that the Managing Director on the St. Regis project for Tavistock is a former Chairman & CEO of Publicis New York). Their new program focuses on working with Atlanta's top realtors and hands-on involvement from a dedicated on-site team and Tavistock brass, which will no doubt be appreciated by the high net worth individuals that are the target market for homes that average $800 per square foot for a 'white box.' In addition, Tavistock is finishing some of the work left unfinished in the hotel by the recession: they'll be announcing a new restaurant concept by a local chef in the restaurant space left vacant when the Buckhead Life Restaurant Group decided to take their new concept across the street to the current 103 West building.
Given the thought and strategy behind this acquisition, the patient nature of the capital that funded it, the investments Tavistock has already made in the St. Regis and the understated intelligence, class and sophistication that has characterized the re-launch of the residences, we're bestowing upon it it a Curbed Award. When the Atlanta luxury condominium market recovers, we'd bet the Residences at the St. Regis will be leading the way.