River city shift
1,800 residences on the drawing board
Chattanooga was once known as the Dynamo of Dixie, a place where foundries and factories employed thousands and commercial barges traversed the Tennessee River.
Now, old brownfields that once offered some of the city’s prime riverfront factory sites are undergoing extreme makeovers to hold houses, condominiums and apartments.
“This is a transition going on,” said former Chattanooga Mayor Ron Littlefield, who was a city planner before entering politics. “Big residential developments are going in areas where no one would have thought of it. Now, it’s prime residential property.”
Nearly 1,800 single-family homes, townhouses, condominiums or apartments in nearly a half dozen projects are on the drawing board — all located in the downtown area or within a few miles of it along the Tennessee River.
Each has sought approval from the city or received the OK within the past year or so.
Those are in addition to big mixeduse projects already proposed on old manufacturing locations such as the former Alstom plant downtown along the river and the Wheland Foundry/ U.S. Pipe tract nearby.
The transformation is spurred by a combination of events, developers and others say: The number of housing units in Chattanooga hasn’t kept pace with demand as the market draws new residents; the coronavirus pandemic has allowed people to live here and work
“Big residential developments are going in areas where no one would have thought of it. Now, it’s prime residential property.” – RON LITTLEFIELD, FORMER CHATTANOOGA MAYOR
remotely; and retirees are moving to Tennessee in droves, attracted by low taxes overall and particularly the lack of a state income tax.
The Chattanooga area has had an average annual population increase of 4.25% since 2019 and a job growth of 6.7% in 2021, according to an estimate by one developer, and builders said they expect the trends will continue.
“There’s a mass exodus leaving large cities,” said Jimmy White, the developer behind the vision for The Bend, turning the former Alstom turbine plant site into one of the biggest mixed-use riverfront projects downtown in decades. “Chattanooga is benefiting from that. Chattanooga is trending.”
Sites now targeted for a wave of housing investments along the river which were not that long ago considered prized sites for business include:
› A 70-acre tract off Amnicola Highway that for many years held the Central Soya feed mill is proposed to hold one of the biggest residential and commercial projects on Chattanooga’s riverfront. Fletcher Bright Co. plans about 750 housing units in a project valued at more than $400 million.
› The $300 million Riverton development will place 400 housing units on a 210-acre site near Lupton City. The property is near the abandoned mill site where Dixie Yarns and later R.L. Stowe once operated a thread mill.
› A $90 million, 350-apartment complex at 702 Manufacturers Road on the North Shore — across the river from Ross’s Landing — is planned by Nashville developer Beacon Companies.
› Some 250 apartments at 430 Manufacturers Road, also looking across the river into the Tennessee Aquarium, are proposed by a South Carolina developer.
› A “resort-style” condominium complex off Riverside Drive just outside downtown is planned. The four-level, 45-unit structure is proposed on waterfront property near the Boathouse Rotisserie & Raw Bar.
In addition, there’s White’s potential $2 billion to $3 billion project called The Bend off Riverfront Parkway. His Urban Story Ventures group is planning housing, manufacturing, offices and amenities on what was formerly the Alstom and Combustion Engineering plant site. That location once employed more than 5,700 employees and made components for both coal and nuclear power plants.
Real estate agents and developers said the need for more Chattanooga area housing is acute. For example, the area’s housing inventory in April shrank 3.2% year to date to 1,060 units and prices continued to gain traction, according to Greater Chattanooga Realtors. The median sales price increased 20.5% year to date to $302,500 and days on the market was down 39.1% year to date to 14 days, according to the association.
Michael Mathis, a veteran banker and Chattanooga president of Pinnacle Financial Partners, said the local housing market is “a great value” compared to some other cities, noting quality of life and the outdoors scene.
Mathis said it’s not just Chattanoogans who are buying homes and renting properties. He said more people are choosing to live in the Scenic City and helping drive a robust housing market.
“We’re seeing people move here from all over the country,” he said in an interview.
Alan McMahon, development manager for a South Carolina company that recently completed building a 163-unit apartment and townhouse rental project called River Rock in downtown’s riverfront district, said the pandemic accelerated the trend of people moving to Southeast cities such as Chattanooga.
While the city already had seen some sizable waterfront developments over the past decade or so, McMahon cited the flexibility a lot of people have when it comes to working remotely that emerged from the pandemic coupled with Chattanooga’s quality of life, the outdoors and downtown.
“All that is right outside your front door,” he said in a phone interview.
Also, after people were “cooped up” during the teeth of the pandemic, they want to be outside more, McMahon said.
“There’s a lot of active lifestyles now,” he said. “I see that in spades right now.”
McMahon said Chattanooga’s economy and employment numbers are strong, naming some of the downtown area’s key employers such as Steam Logistics, Unum, BlueCross BlueShield of Tennessee, Tennessee Valley Authority and Erlanger Hospital.
Additionally, the dramatic spike in fuel prices has spurred people to look at walkable locations to live, he said.
HOUSING IN DEMAND
Developers also cite the draw of the river and proximity to the central city and the Tennessee Riverwalk as reasons for the proposed slew of new waterfront living options.
“It’s the recreational appeal and proximity to downtown,” said Scott Williamson, a vice president at Fletcher Bright Co., which is behind the Central Soya project off Amnicola Highway and Judd Road.
The Central Soya feed mill — four miles from downtown — sat vacant for more than a decade and a half, Williamson said in a phone interview.
“We’re trying to get a development that is pedestrian friendly and has access to downtown,” Williamson said, adding that the project is seeking approval for 100 boat slips on the river. “Downtown is more attractive than it used to be.”
Williamson said price points on the housing aren’t set yet and will depend on when units appear on the market and construction costs. The project will have a diversity of housing types and sizes, he said.
“Riverfront will be higher priced, and we’ll work our way through different tiers that will appeal to different income brackets,” Williamson said.
The proposed 350-apartment project on Manufacturers Road also will offer retail, a restaurant and access to the river, said Chris Rudd, chief executive of the Beacon Companies development group in Nashville.
“It’s a short walk to all the amenities on the North Shore,” Rudd said in a phone interview. He also said the Riverwalk is expected to be extended to the site, a former industrial location next to a fuel farm, and onto the Moccasin Bend Archaeological District nearby.
Just a year ago, planners had expressed concerns about rezoning that historically industrial area of Manufacturers Road for apartments in a proposal from a different developer.
But demand for more housing spurred city planners in April to agree to open that area to the apartment project — and possibly more mixed-use development near there.
Planners said in a document recommending approval of the Beacon proposal that the city needs the added housing and the Manufacturers Road area is changing. One projection is that there’s a shortage of 5,000 residential units in the Chattanooga area and potentially 25,000 over the next decade.
“People will get views of the waterfront and downtown Chattanooga,” Rudd said about the proposed project.
Over the past few years, Williamson said the housing market has been hot at all the income levels and prices in the Chattanooga area.
“At all the price points there has been a lot of demand,” he said.
“We’re seeing people move here from all over the country.” – MICHAEL MATHIS, VETERAN BANKER
RIVER APPEAL
Cardon Smith, also a Fletcher Bright Co. vice president, said he’s overseeing plans for the riverfront condominium complex off Riverside Drive.
“The riverfront frontage and the location on the Riverwalk — it’s a prime location right there,” said Smith by phone.
He said there’s a lack of inventory for that kind of residential product, described as “resort-style condos.” The developer said prices haven’t yet been finalized.
“We’re getting phone calls constantly,” Smith said. “People are asking for information, but we’re not there yet.”
White said by phone that the pandemic spurred more interest in the city and has changed the way people are looking at space.
“Right, wrong or indifferent, we’ve been discovered by the development community and the general population,” he said.
While much of the residential housing proposed by developers on the river is seen as high-end, White said The Bend is looking at offering units that mirror Chattanooga.
“We’re trying to work through, ‘how do we have employees on site who can afford to live on site?’” he said.
White said multiple developers are interested in building new housing near the Cameron Harbor, or north side, of the parcel.
Dawn Hjelseth, vice president of marketing and communication for the downtown nonprofit redevelopment group River City Co., said people who gave input for the city’s One Riverfront Plan completed last year want more affordable housing in the waterfront district.
“There was a desire for workforce housing — for more individuals that work downtown to have a place to live,” she said.
Hjelseth said people are looking for options in the market, whether they’re recent college graduates, people working from home or retirees.
Not far outside downtown on the river, Chattanooga developer John “Thunder” Thornton won approval about a year ago from the city for an initial plan for the Riverton development’s 400 residential lots.
Dane Bradshaw, president of Thunder Enterprises, said that despite some delays in the launch of the Riverton, “the demand and enthusiasm for this community are still sky high.”
“We hope to launch this within the next calendar year,” he said by phone.
Thornton said earlier that he envisioned homes priced from $400,000 up to more than $1 million each, depending on size and location, and the project is likely to include both townhomes and large single-family homes.
Thornton had hoped to begin building on the development two years ago, but the project is still awaiting regulatory approval for its dock permits and the OK for site changes along the river.
Littlefield said in a phone interview that he believes Chattanooga is seeing what already has happened in big cities such as New York, Baltimore and Boston where former riverfront industrial property is undergoing redevelopment for housing and other uses.
“It’s a wonderful thing to watch,” he said.