Written: November 11, 2017

National retailer claims top Atlanta broker ran massive fraud scheme

A lawsuit by the nation’s largest specialty bedding retailer claims a top Atlanta commercial real estate broker stuffed his mattress in a long-running fraud and bribery scheme.

Houston, Texas-based Mattress Firm Holding Corp. alleges prominent retail dealmaker Alexander Deitch was at the center of a “massive, multi-year fraud, bribery, and kickback scheme involving the senior management of a national retailing company.”

Mattress Firm is the nation’s top specialty bedding retailer with more than 3,400 company-operated and franchised stores across the country. At the time of the alleged scheme, Deitch was a senior vice president and principal at Colliers International Atlanta, one of the city’s largest commercial real estate brokerages. This year, Deitch was named No. 4 retail producer by the Atlanta Commercial Board of Realtors and is a lifetime member of its Million Dollar Club.

Deitch is no longer employed by Colliers.

The lawsuit filed Oct. 30 in the District Court of Harris County, Texas, claims Deitch worked alongside top Mattress Firm real estate executives Bruce Levyand Ryan Vinson (among the 17 defendants named in the case) to defraud the retailer out of potentially millions of dollars.

“Mr. Deitch denies the allegations made in the petition filed by Mattress Firm,” his attorney, Kevin Ward with Atlanta-based Schulten Ward Turner & Weiss LLP, said in a statement to Atlanta Business Chronicle. “All of his business dealings were conducted in good faith and in the best interests of Mattress Firm. He intends to defend the lawsuit in court.”

Among the allegations, the 47-page lawsuit claims Deitch inflated rents and elongated lease terms for Mattress Firm stores, thus earning higher commissions. He also allegedly set up shell companies including an entity called Chase Ventures LLC to clandestinely purchase properties that Mattress Firm was to lease, placing him “secretly on the opposite side of the transactions,” says the lawsuit.

Mattress Firm also accuses Deitch of charging bogus developer fees in excess of $50,000 per store. The lawsuit alleges he worked with a preferred group of developers who made “millions of dollars in profits” flipping Mattress Firm stores with above-market rents. Those developers in turn gave kickbacks to Deitch, and Mattress Firm’s Levy and Vinson in the form of “lucrative business opportunities and extravagant gifts,” says the lawsuit, such as free hotel stays, expensive dinners and exotic trips.

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Luxury Buckhead residential community breaks ground

Shovels for the long-expected luxury residential community in Peachtree Hills have finally hit dirt.

More than a decade after first being announced, a 216-unit senior living project in Peachtree Hills has broken ground, its developer says.

The entire development will cover about 20 acres in the historic south Buckhead neighborhood known for its dense tree canopy and Peachtree Creek.

Site development on the project, officially called Peachtree Hills Place, is underway. Construction on the first units could start later this fall.

It has more than $117 million in financing from SunTrust Bank, Atlantic Capital Bank, Iberia Bank and Capital Bank.

Peachtree Hills Place is geared to the high-end homebuyer. It will include 204 condos in six, four-story buildings. The condos will range from $730,000 to $1.8 million. Twelve custom-built single-family homes will start at $1.8 million.

The project was first pitched in 2005 on the cusp of the historic recession, with plans for more than 260 luxury apartments.

Asked about changes to the project’s overall plan and the more-than decade long process to get to groundbreaking, Isakson said, “We were patient.” An important step included getting feedback from the project’s first homebuyers, who suggested a few tweaks. “We worked through a myriad of things,” he said.

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Atlanta City Council to consider density bonuses for affordable housing

Developers willing to add affordable housing units to apartment projects or build near transit could receive density bonuses under legislation introduced into the Atlanta City Council this week.

The ordinance, sponsored by Councilwoman Carla Smith, would let developers willing to commit to affordable housing construct taller buildings, thus allowing more apartments. Apartment projects built near transit also would qualify for density bonuses.

Unlike two “inclusionary zoning” ordinances currently circulating among local neighborhood planning units (NPUs), Smith’s ordinance would be voluntary for developers rather than mandatory. It also would apply to the entire city, rather than specific communities.

“Affordable housing needs to be everywhere,” Smith said.

Smith said she plans to send the ordinance to the NPUs for input before putting it through the city council’s committee review process.

“I want to hear everyone’s ideas,” she said. “Then, maybe we can write a [new] paper or amend this paper.”

While Smith is lead sponsor of the ordinance, most of the other council members also have signed on as co-sponsors.

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South downtown’s Norfolk Southern building sells for $25 million

The former Norfolk Southern headquarters, an abandoned landmark on Spring Street eyed for years as a major south downtown redevelopment, has sold for $25 million.

The buyer, 99-125 Spring Street Atlanta Owner LLC, is said to be affiliated with Los Angeles-based real estate company CIM Group, according to sources familiar with the deal.

At nearly 406,000 square feet, the Norfolk Southern property is one of downtown’s largest and most complicated redevelopment opportunities. Under new ownership, it may be woven into a sweeping south downtown project that Newport U.S. is RE planning. It could create a walkable mix of residences, shops and restaurants stretching all the way to Mercedes-Benz Stadium.

The sale of the Norfolk Southern building was completed on Sept. 27, according to Fulton County property records. The LLC paid about $62 a foot.

Earlier this year, Atlanta Business Chronicle reported CIM Group planned to develop a $1 billion mixed-use project around a renovated Philips Arena. One of the principals of CIM is Richard Ressler, the brother of Tony Ressler, the majority owner of the Atlanta Hawks.

An email to CIM principals was not immediately returned. Norfolk Southern declined comment on the sale.

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Houston’s hospitals treat storm victims and become victims themselves

Water poured into hospitals. Ambulances were caught up in roiling floodwaters. Medical transport helicopters were grounded by high winds. Houston’s world-renowned health care infrastructure found itself battered by Hurricane Harvey, struggling to treat storm victims while becoming a victim itself.

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306 new homes proposed in Cobb County

Developers are proposing four new residential developments in Cobb County that would have a total of 306 homes.

3757 Floyd Rd Property LLC is proposing a 58-unit townhome community on 7.3 acres. Homes would be 1,500 to 2,000 square feet and up, according to plans filed with Cobb planners.

Meritage Homes of Georgia LLC is proposing 174 homes on 47.5 acres at the southwest intersection of Floyd Road and Glore Road in Cobb County. The project would include townhomes of 1,700 to 2,300 square feet and up, and single-family detached homes of 1,800 to 3,200 square feet and up.

Traton Homes LLC is proposing 56 homes on 16.3 acres at the southwest intersection of Burnt Hickory Road and Bob Cox Road in Cobb County. Homes would be 1,800 to 2,800 square feet and up, with Traditional/Craftsman architecture.

And CPS Development LLC is proposing 18 homes on 8.9 acres on the west side of Wesley Chapel Road and the south side of Sandy Plains Road. Homes would be 3,000 square feet with Traditional/Craftsman architecture.

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Country singer Alan Jackson selling Lake Burton estate for $6.4 million

Country singer Alan Jackson is selling his Lake Burton estate for $6.4 million.

The 7,687-square-foot, lake-front property has five beds and nine bathrooms, according to the listing. It also comes with a two-story boathouse.

“Extraordinary design, materials and craftsmanship define this prominent Lake Burton estate home located on a 1.2-acre manicured lot with majestic mountain, lake and sunset views,” says the listing. Julie Barnett with Harry Norman Realtors is the listing agent.

Jackson, famous for songs such as “Chattahoochee,” is just one celebrity who has called Lake Burton home.

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India-based tire maker Apollo moving North America HQ to Atlanta

India-based tire maker Apollo Tyres Ltd. is moving its North American headquarters to Atlanta as the company launches a U.S. expansion.

Apollo is the world’s 17th-largest tire maker. It recently opened a new plant in Hungary as it expands in Europe.

Apollo’s vice chairman recently stated that “The U.S. plays a real important part for us in our growth strategy,” Rubber & Plastics News reports. “Given now that we have two domestic markets, which is largely Europe and India, our next stop has to be the U.S.” Apollo exec Steven Smidlein has been working to lay the foundation for the company’s U.S. expansion, the publication says.

The Atlanta headquarters will be at 1175 Peachtree in Midtown, TireReview.com reports. Read more here. It will initially have five employees but will grow as the company expands in the United States, Rubber & Plastics News reports. Read the full story here.

 

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Jones, Ryan, trail NFL stars in merchandise sales

The Atlanta Falcons may have come within an eyelash of winning their first Super Bowl, but they have a way to go to the top of the National Football Leaguewhen it comes to player merchandise sales.

The Falcons placed only two players on the newest NFL Players Association Top 50 Players Sales List, which tracks sales of officially licensed NFL player merchandise. Both ranked in the middle of the pack.

Wide receiver Julio Jones was the top Falcons player on the list at No. 20, while the NFL’s Most Valuable Player, quarterback Matt Ryan, came in at No. 32.

Dallas Cowboys running back Ezekiel Elliott topped the list, the first rookie to do so. Dallas Cowboys quarterback Dak Prescott was second.

Super Bowl-winning quarterback Tom Brady of the New England Patriots came in at No. 3, with another Cowboy — Dez Bryant — ranking fourth, and the New York Giants’ Odell Beckham Jr. rounding out the Top 5.

Nineteen quarterbacks are on the list, six in the top 10. Following Prescott and Brady are Russell Wilson of the Seattle Seahawks (No. 6), Philadelphia Eagles rookie Carson Wentz (No. 7), Aaron Rodgers of the Green Bay Packers (No. 8), and Cam Newton of the Carolina Panthers (No. 10).

Jones and Ryan actually ranked within the Top 10 in apparel sales. Wentz and Ryan trailed only Brady in plush doll sales.

The list tracks year-end results from March 1, 2016 through February 28, 2017

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Duke Realty selling its medical office buildings, including 11 in Georgia, for $2.8B

Healthcare Trust of America Inc. (NYSE: HTA) and Duke Realty Corp. (NYSE: DRE) announced a blockbuster deal Monday morning in which Healthcare Trust of America will buy Duke’s entire portfolio of medical office buildings, including 11 in Georgia, for $2.8 billion.

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