Statham city officials are poised to consider a controversial land investment company’s request to annex and rezone 360 acres off Highway 316 as a planned unit development called “One University Parkway.” But that proposed project appears to be another move by the firm, Walton International, to have large tracts of land rezoned as part of an international land banking investment program rather than being built out as the company tells local officials it will do.
The firm owns a large tract further down Hwy. 316 and had it rezoned last year by the Barrow County government and other local tracts. The firm has run into rezoning problems with two large tracts it has in Jackson County.
The Walton Group LLC and an affiliate filed rezoning and annexation requests with Statham officials on Oct. 15. The applications call for a master planned development with up to 600 residences and up to 2.5 million square feet of non-residential uses to be built on seven parcels that straddle Highway 316 near Wall Road.
Part of the land is already in the city limits of Statham with 221 acres in unincorporated Barrow County. Walton’s annexation request is scheduled to go before county officials in November and Mayor Robert Bridges said Tuesday that he expects the rezoning and annexation applications to come before the city council next month as well. The city has not yet filed a regional impact study with the Northeast Georgia Regional Development Center, although it has a draft copy prepared.
INVESTMENT FIRM
Walton is a Canadian-based land investment company that purchases undeveloped land and resells it in small “units” to mostly Asian investors. The firm’s strategy is to buy raw land, resell to investors, seek rezoning approval and then later flip the property to another owner. Walton makes its money by buying the land cheaply — between $9,000 to $10,500 per acre for the Statham tracts — and then reselling in small units at a much higher price to investors. The investors make their money if Walton is able to later resell the property at a higher price to another investor. The Statham property has been marketed to Asian investors at a price over $52,000-$66,000 per acre. Walton tells investors that by getting the rezoning in place, it will improve the value of the land for resell.
But in their meetings with local public officials in both Barrow and Jackson counties, Walton representatives haven’t talked about the firm’s investment plans. Instead, Walton representatives tell local officials the firm plans to develop the property itself, although Walton has never done any development itself on property it owns in the U.S.
Representatives show local officials “concept plans” for the property — maps and schematic plans for development — and in previous meetings with both Barrow and Jackson governments, led officials to believe those were the firm’s development plans for the property. However, the company isn’t bound to those designs since they are just concepts of how the land might someday be developed.
STATHAM PROPERTY
Walton purchased the parcels it is now calling One University Parkway in 2011 and has marketed it to investors as “Wolf Ridge” and “Koi Ridge.”
An online marketing flyer says the company was syndicating 750 shares in the 143-acre Wolf Ridge project for $7.5 million. The price per acre for investors was about $52,450, and the flyer said the “anticipated hold time” before resale for investors to receive a return on their investments would be “4-6 years.”
Months after its purchase of those tracts, Walton purchased an adjacent 218 acres in unincorporated Barrow County and called it Koi Ridge. Walton paid over $1.2 million for 181 of the acres at that location. But the marketing flyer for Koi Ridge said 450 units would be syndicated at a combined per-acre price of $66,380 with an anticipated retention period of 4-6 years before reselling the land to another owner.
VESTING WOULD BE IMMEDIATE IN STATHAM
Some governments put “vesting” language in rezoning deals that give a developer a certain period of time to begin work, or the land reverts to its original zoning use. That is the situation with last year’s Barrow rezoning of Walton land where the firm has not yet begun any work.
The company has until Dec. 13, 2013 to start construction on the Barrow Landing site near highways 81 and 316. It has not submitted any development plans for that master planned development since the Barrow County Board of Commissioners approved it in December 2011. (Please note that because of incorrect information from a county source, an earlier version of this story said Walton's vesting at Barrow Landing would end in seven weeks. However, that isn't correct; Walton has until next year to begin work on Barrow Landing.)
Walton is seeking immediate vesting in the Statham deal so that it would not have to do any work to maintain the rezoning status.
“The City of Statham agrees that the Applicant, upon receipt of approval hereof has vested right in developing and may proceed to develop the Property according to these Conditions of Zoning,” the document states.
The rezoning application also says the concept plan submitted with the application “shall serve as a general guide for the development” and sets the “total development entitlements” to a maximum of 600 residential units and 2.5 million square feet of space.
