One of Atlanta’s earliest skyscrapers, the W.D. Grant Building, is scheduled for a forced auction on October 7, 2023. This ten-story office building, which has stood for 127 years at 44 Broad St. in Downtown Atlanta, is embroiled in a legal battle that has complicated its future.
The auction date comes after a Fulton County Superior Court judge approved a delay following a request from Bush Construction, the contractor that currently holds the building’s title. Bush Construction claims that the lender, UC Funds, is jeopardizing around $8 million in federal historic tax credits with its decision to foreclose on the property.
The lender, on the other hand, argues that Bush Construction lacks a feasible plan to complete the renovation that would allow them to claim those tax credits. Bush Construction initiated legal action against UC Funds in August after UC Funds began foreclosure procedures, which Bush argues is merely a tactic to undermine their control over the renovation process.
Documents reveal that UC Funds contends blocking the foreclosure would merely allow the building to remain in its current, unrenovated state indefinitely. UC Funds further asserts that the renovation delays not only threaten the building’s historical integrity but also hinder any potential restoration efforts.
The W.D. Grant Building was added to the National Register of Historic Places in 1979, highlighting its significance in Atlanta’s architectural landscape. Originally purchased late in 2022 by Wolfe Investments and Bluelofts Inc., the plan was to convert the historic structure into 120 apartment units managed by short-term rental provider Sonder, as reported by the Atlanta Business Chronicle.
A loan of $36.5 million was provided by UC Funds to assist with the acquisition and planned renovations of the building, and Bush Construction was brought on board to oversee the construction aspect. As part of the loan agreement, both UC Funds and the developers established a forbearance agreement designed to safeguard the developers’ interests concerning state and federal historic tax credits.
However, the redevelopment project experienced delays due to funding issues. Bush Construction claims that it actively sought solutions with both the developers and UC Funds for over a year to take control of the renovation project. Yet, by early 2024, progress had stalled, leading Bush to file mechanic’s liens for over $11 million against the developers due to unpaid work.
In May 2024, UC Funds initiated foreclosure proceedings on the Grant Building. However, after negotiations concerning the purchase of the loan for $15 million, the foreclosure process was temporarily halted. Unfortunately, this agreement fell through, leading UC Funds to issue a default notice demanding the outstanding loan balance of $24 million.
During this turmoil, Bush Construction negotiated to acquire Monarch Private Capital’s equity stake in the project for over $951,000, thereby gaining rights to the historic tax credits. According to court documents, this move resulted in Bush becoming the sole controller of the LLC that owns the Grant Building, although UC Funds disputes this claim.
After acquiring Monarch’s interest, UC Funds announced an auction for the Grant Building’s loan, originally set for September 2. Following this, Bush filed a lawsuit against UC Funds arguing that the lender had violated their forbearance agreement and had failed to adequately notify them of the foreclosure process.
Bush’s CEO, Mike Bush, indicated that acquiring the tax credit investment fund was a step in their ongoing effort to reset the project. Meanwhile, UC Funds countered that there were serious financial disparities, stating that Bush had informed lenders that completing the project would require $65 million—far exceeding the last appraisal of the project, which estimated its value upon completion at $30.7 million.
In court documents, UC Funds emphasized that Bush’s proposal to finish the renovation seemed financially implausible, arguing it would require an investment substantially higher than the projected value of the renovated real estate. The lender accused Bush of attempting to leverage the historic tax credits to negotiate a lower purchase price for the outstanding loan balance.
Representatives from Wolfe and Bluelofts did not respond to inquiries regarding the ongoing situation. Meanwhile, the legal wrangling surrounding the W.D. Grant Building continues to unfold, with the next major development expected at the upcoming auction.
The viability of the W.D. Grant Building’s future remains uncertain as both sides prepare for the October auction amidst contentious litigation. With the building’s historic status at stake, the outcome of this dispute could significantly impact not just the property itself but also the broader landscape of historic preservation in Atlanta.
image source from：bisnow
