Va-Hi

Feb 03, 2024

Don’t wait to buy real estate. Buy real estate and wait.

Will Rogers

Every neighborhood aspires to having a charming row of shopfronts - or better yet, a few blocks of them - facing each other on both sides of a narrow street filled with an egalitarian mix of bikes, cars, and people.

This village center of our dreams has an independent bookstore, a funky coffee shop, ice cream, a family hamburger joint, a butcher, a wine shop, and a few date night places.

When we’re extra generous with our aspirations, there’s also a specialty hardware store and a stationery shop, a bakery, a bike shop, an oysterette, and exceptional pizza.

And when our thoughts tilt toward an unhinged nirvana fever dream, this place we desire brims with lush patios, tacos, cold beer, and a bit of neon.

Take a trip to Atlanta’s Va-Hi neighborhood, surrounding the intersection of Virginia Avenue and N. Highland Avenue, and feel the Narcan adrenaline needle plunge into your chest when you realize it doesn’t have to be a dream.

It’s the place we’d design if we could, replete with neighborhood beers and neon:

These commercial oases happen neither by accident nor with haste. They require a champion - one with both skin in the game and the patience of Job. In the case of Va-Hi, it’s gentleman and real estateur Stuart Meddin who acquired a big chunk of the commercial core in 1983 and day by day every day since has protected and polished his wonderful properties, or as he describes it, “had fun”.

Conventional financing wasn’t an option when he bought his Virginia Highland buildings. But he had a motivated seller who needed out, and needed out fast. His real estate pals thought he was nuts for shoveling a meaningful portion of his net worth into dilapidated properties in a dangerous neighborhood.

Where others saw drugs, old hippies, and gays, he saw fun-loving customers with money to spend and he set about repairing his buildings and tenanting them with businesses that made sense for the neighborhood.

And as the neighborhood evolved, so did the tenancy. But he held to one consistent principle - local businesses. As Virginia Highland became more and more desirable, the charm he enhanced drew the attention of national chains, causing him to strengthen his most important skill - saying no.

McDonald’s - no. Gap - no. Victoria’s Secret - no. The list grew and he held firm, even finding sport in it.

Today, thanks to his stalwartness, Virginia Highland has become a dream.

A neighborhood bookstore with a tin ceiling and hardwood floors

The buildings are as functional as they’ve always been, just more vibrant:

workouts, espresso, salumi, and pistachio cheesecakes

A few of the seminal joints remain:

The grizzled veterans of Va-Hi: established 1947, 1961, and 1989

Food anchors the neighborhood:

Whole animal butchery, fresh oysters, and pepperoni & negroni to go

The neighborhood has transitioned to strollers and athleisure but the charm remains.

The rents are now 10x what they were in 1983, meaning the properties’ annual net operating income is now more than the original purchase price. It’s a simple business plan, but not an easy one: buy dirt cheap properties (when the consensus is that you’ve lost your mind) in dense neighborhoods of fast-growing cities, then fix them up, and keep fixing them up for 40 years while the surroundings become ever more desirable and your tenants ever more successful.

And, just as important, know when to abdicate responsibility - leave the men’s room decor and maintenance to the experts who’ve been at it since 1947:

Thank you for reading Asphalt Jungle - if you’re passionate about transformative real estate development, apply to join AUTOMATIC - a gathering for real estate developers interested in making wonderful places and the innovative retail & hospitality brands, designers, contractors, and capital providers that bring those places to life.

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