The Developer of Newell-Rubbermaid's New HQ in Perimeter Center Discusses How the Deal Happened, How Glenlake Serves as the Bookends to Atlanta's Development Cycle, and Why at Least One Person in Atlanta Enjoyed that Wake Forest Win Over Ga. Tech

It's been two years since Atlanta real estate veteran De Little set up his own shop following a highly successful 17-year career with renowned Atlanta developer Pope & Land, where he rose to become one of the top producer partners at the firm.

Since forming Greenstone Properties in January 2005, Little has maintained close business ties with his former colleagues, 'going vertical' on several significant developments throughout the market in joint ventures with Pope & Land and other partners.

As he and his team at Greenstone mark their firm's second anniversary, they have much to celebrate. In October, Greenstone scored perhaps his biggest real estate coup yet, landing a full-building lease with Newell Rubbermaid Inc. to occupy Two GlenLake, a 350,000-square-foot, 14-story office building Greenstone Properties is developing in partnership with Pope & Land and Dallas-based Granite Properties.

The striking, curvilinear glass structure under construction in the Perimeter Center office park was designed by architects Pickard Chilton and Wakefield Beasley and will serve as the Atlanta headquarters for the Fortune 500 firm. The groundbreaking occurred last month with Newell Rubbermaid targeting a Fall 2008 move in date. Employees from the three current Atlanta sites will operate under the same roof. The new headquarters will include a 1,200-car parking deck, training center, cafeteria, and state-of-the- art communications center.

Newell Rubbermaid, maker of Sharpie pens, Calphalon cookware and Rubbermaid cleaning and storage products, moved its corporate headquarters to Atlanta in February 2003. Since then, the firm has tripled the number of employees in the Atlanta market over the past three years. The company has the option to accommodate future expansion in a third building to be built on the site.

CoStar caught up with Little to talk about the significance of the project for his firm and the market, and where he sees the overall development market headed.

Congratulations, De. This appears to be a home run as far as your firm and the Perimeter Center submarket are concerned.

Absolutely! Based on the market acceptance of One Glenlake, our partnership purchased the phase two site in March of 2005. Newell Rubbermaid obviously shares our high regard for the real estate. And it's interesting to note that One Glenlake, which opened in early 2003, was the last building delivered in the previous development cycle. And the Newell Rubbermaid building will be the first building delivered in the next cycle when it opens in the spring/summer of 2008.

Fill us in on the background to the deal. How did Newell Rubbermaid come to select Two Glenlake for its headquarters?

On June 8, we responded in writing to an RFP issued by Stuart Cott of Cott and Lambert, in conjunction with Cushman Wakefield. Prior to our responding to the RFP in June, Stuart and Art Garcia, Director of Real Estate for Newell Rubbermaid, had already narrowed their options to a few sites along the Ga 400 Corridor. In mid to late June, Stuart told us that our site was one of a handful of sites that were still being considered, and that Newell’s approach would be to pick one and try to negotiate satisfactory business terms with that preferred location.

On Aug 16, we met with Art and Stuart at our offices and Art informed us that Two Glenlake was Newell Rubbermaid’s preferred choice and that, if we could agree on business terms, his goal was to sign a lease in early October. On October 10, a lease was executed, less than six weeks after we reached a verbal agreement.

Who else at Greenstone played a key role in landing Newell Rubbermaid?

Chris Scott was very involved upfront, including spearheading the lease negotiation. Jimmy Penson and Elizabeth Otte are overseeing the design, permitting and construction of the building and are working with the Newell Rubbermaid team and their consultants to incorporate their personal touches for their corporate home.

Larry Kelly at Pope & Land and Steve Martin at Granite Properties provided wise counsel. Pickard Chilton, Wakefield Beasley and Brasfield Gorrie deserve a lot of credit as it was critical that we finalized the design and pegged the cost of the building in a very short timeframe.

When did you feel confidant that you had won the deal? Literally when we shook hands with Art Garcia in mid to late August.

It is not uncommon for it to take six months or more to finalize a 5,000-square-foot lease. For a deal of this magnitude to occur in less than four months is simply unheard of, and is a direct testament to Newell Rubbermaid’s corporate culture.

There is a lot of lip service these days in Corporate America in regards to concepts like autonomy, decentralization, personal accountability, embracing responsibility, etc. Art’s team is knowledgeable, decisive, honest, tough but fair, and clearly empowered.

Between your lease with Newell Rubbermaid and Crawford & Co.’s lease of 160,000 square feet at the HP Building, 20 Perimeter Summit Blvd., it appears the Perimeter Center is attracting more and more interest from tenants, a big change from only a few years ago when office vacancies hovered around 30%. What happened to turn this into perhaps metro Atlanta’s most vibrant, active commercial submarkets?

One could make a strong case that the I-285/Ga 400 intersection is the center of the Metro Atlanta area, and is probably the only office submarket that can truly accommodate all the various employee bases dispersed around the Atlanta area as well as the executives who live in Buckhead, North Fulton, Dunwoody and East Cobb. The Perimeter office has been, and continues to be, the largest office submarket in the Atlanta area, and is transitioning to a true mixed-use urban environment.

As you know, statistics don’t always tell the story. A fair amount of that 30% vacancy number was simply functionally obsolete (space) and is now being redeveloped into other uses.

What other factors about it make this area the "hot" one right now?

The CID deserves a lot of credit for their efforts to improve traffic and to make the area more pedestrian friendly. The new Perimeter Center Flyover Bridge is a big step. And we are all hopeful that the Ashford Dunwoody interchange improvements and half-diamond interchange at Hammond and ultimately the entire 400 collector/distributor system will be underway in the not to distant future.

Where do you see development headed in the Atlanta market? What's the next area you expect to 'get hot'?

Atlanta is pretty hot across the board right now. From an office perspective, it seems that we are pretty close to reaching a supply/demand dynamic that would be favorable for new construction in several submarkets. While rental rates seem to be increasing, they are still 20% or so below the hurdle you need for new construction. And I am not sure the growth in rental rates is keeping pace with the increase in construction costs. So all in all I think we're more likely to see build-to-suits or substantially pre-leased projects as opposed to spec for the foreseeable future.

The fact that this is the first Fortune 500 company to relocate to Atlanta since UPS moved here from Connecticut in 1991 is telling in some regards. Georgia Governor Sonny Perdue is reported to have said regarding Newell Rubbermaid "This Fortune 500 company being headquartered in our state is proof positive that Georgia's business climate is thriving and attracting the attention of corporate CEOs across the world." Do you agree?

Absolutely, it is a massive undertaking for a company like Newell Rubbermaid to relocate, and there are a lot of attractive options out there. At the end of the day, Atlanta was chosen and other cities were not.

Many people probably thought you would fashion Greenstone as a "mini Pope & Land," focusing mainly on land speculation. And while that remains a key part of your firm's focus, you also seem to be looking to diversify a little more, such as recently bringing in Retail.

First of all, it would be an honor to be considered a 'mini Pope & Land,' and our hope is that Greenstone can replicate Pope & Land’s long and extremely successful track record. Both companies look for opportunities to create value through investing, developing and managing real estate. Opportunities begin with the underlying land, and that will always be our focus, whether we are speculating on that land, or developing it.

We were very fortunate that someone of Les Lewis’s caliber and track record would join us and create a retail division at Greenstone. As the world continues to transition to mixed-use developments, we both felt that it would be an advantage to have land, office, and retail disciplines under one roof. Hopefully it will also diversify our revenue stream a little bit.

What other plans do you have for Greenstone? Where do you see the firm five years from now?

I know this sounds a little trite, but our plan is simply to find the next deal that makes sense, and to go wherever that takes us.

Who do you consider to be your mentor? What was the best advice/approach to the business you learned from him or her?

I was blessed with wonderful parents who have always loved, supported, inspired and challenged me. My Dad has enjoyed a very successful business career and has always been there for me. Both as a living- breathing model demonstrating character and integrity, and through years of conversations about the business world, and more importantly about the rhythms of life.

Larry Kelly has the most intelligent and creative real estate mind that I have ever seen, and I am still awed by the clarity of his vision. As good as he is in the real estate arena, he is an even better person. I think both my Dad and Larry would say the key to life is to have fun in all that you do, and that if you find something you enjoy doing you will never work another day in your life.

You started out in banking. How did you get your start in real estate?

I was calling on local Atlanta real estate developers trying to provide construction loans for their projects. Larry hired me to work with Dan Pattillo, Sr. on the development and leasing of the second phase (100,000-square-foot office building) of Decatur TownCenter in downtown Decatur.

What do you consider to be your big break in the business?

I would say I'm fortunate to have had three: The day I went to work at Pope & Land in 1988; the portfolio of land we bought from the RTC in 1993; and the purchase of the NorthWinds property in 1995.

Looking back now, the decision to form Greenstone appears to have worked out perfectly. Would you agree?

Life provides an interesting progression of choices, and sometimes choices are between what is right and wrong or what is good and bad, and sometimes between two very right and two very good options. It was not an easy decision to leave a wonderful environment at Pope & Land. But for whatever reason, I have always wanted to start a company from the ground up, and Larry, A.J. and Jay were gracious to support this desire.

We are still partners in several deals, including Glenlake, and though we obviously do not see each other as often, remain close friends.

Greenstone has been a wonderful ride, with peaks, valleys, exhilarating straight-aways and a few curves. We have a total of seven gifted people on board now, who are all capable of wearing several hats. Though this business also requires a lot of luck, and simple good fortune, I feel we have a team in place that should be able to perform at a high level over the next several years.

We know you have many other projects in the works. What are some of the biggest or most significant?

Chris Scott is busy leasing our Milton Park project and has 24 acres under contract in North Fulton across the street from Stan Thomas’s Prospect Park, where we hope to develop 600,000 square feet of office space in three buildings. We have 30 acres under contract to Amli at our Preston Ridge development, with closing subject to a rezoning in early 2007. Les has several interesting opportunities on his plate, and we are confident one or more of them will turn into a 'real deal' in the next couple of months. But clearly the Newell Rubbermaid building will be our primary focus over the next several months. It is an honor to have the opportunity to build their corporate home, and we plan on delivering a result that justifies their trust in us.

Last question, we suspect you are a big fan of the Demon Deacons, having earned both an undergraduate and MBA from Wake Forest. Being a Deac in Atlanta, how much did you enjoy that win over Georgia Tech in the ACC Championship football game this year, even if the Orange Bowl didn't go the Deac's way?

Pretty amazing ride for those Demon Deacons this year, and we Deacon faithful have enjoyed it immensely, particularly since it has been a rare treat in the football arena. While I certainly wouldn’t predict we'll make the Orange Bowl every year, Coach Grobe is running one helluva program, and I would imagine we will be competitive year in and year out going forward.

I would have loved to have gone (to the bowl game) but with our three-and-a-half year old son and our baby girl who just joined us on December 1st, we stayed close to home.