700 BLOCK TIMELINE
* 2000 - RiverCity Co. agrees to buy nearly half of the east side of the Market Street block * 2006 - Developer Trey Stanley unveils plans to buy and develop the site with housing and stores * 2007 - Fannie Mae agrees to lend Chattanooga Housing Authority $3.65 million to help CHA fund the 700 block project * 2008 - RiverCity Co. files lawsuit after nothing is built * 2009 - CHA ends involvement in 700 block, having paid $2.2 million to the developer but not the rest of the $3.65 million * 2011 - Lawsuit settled and River City (as now spelled) agrees to buy back property * 2013 - 700 block site identified as a key development opportunity in City Center Plan * 2014 - River City issues request for proposals for the site
An Atlanta group has bought a long-vacant parcel in downtown Chattanooga's 700 block of Market Street with plans to raise one of the biggest apartment buildings in the central city.
The 10-story tower will hold 125 apartments in addition to retail and office space in a project estimated at $25 million to $30 million, said Boyd Simpson, chief executive of The Simpson Organization.
TSO Chattanooga Development LLP, a Simpson entity, paid $1 million for the tract, which sits on the east side of Market Street next to the SunTrust Bank Building, also owned by Simpson.
"We're encouraged by the trends we see downtown," Simpson said.
The company also plans to put about 70 parking spaces in the new structure and connect those with the garage next door that services the SunTrust Building, he said.
The River City Co., the city's private nonprofit redevelopment group, sold the 24,000-square-foot parcel. Last year, it had issued a request for proposals from developers, seeking a mixed-use project for the site.
Kim White, River City's chief, termed The Simpson Organization's plans "a seminal development" for the area.
White said it can unlock a lot of pent-up housing demand and create substantial density of first-class business and retail space in the city-center district.
Matt McGauley, president of Chattanooga real estate group Fidelity Trust Co., said the project is one for which it has waited a long time.
"A project of this scale at that location will be transformative for the whole area," said McGauley, whose company has sizable central city holdings.
River City bought the property in 2000 and sought proposals then for its reuse. Existing buildings at the site were torn down and developer Trey Stanley proposed a $16 million housing and retail complex in 2006 known as Mayfair on Market.
Stanley was unable to secure funding for the project, even after the Chattanooga Housing Authority agreed to provide $2.2 million to begin the project in exchange for making 18 of 58 condo units proposed at the time available as affordable units.
River City sued Stanley and reclaimed the property in 2011. Since then, a portion of the 700 block of Market Street has remained as an empty hole in downtown, serving only as a location for temporary food trucks and open-air movies.
Simpson said plans are to begin construction within three to four months. Work would take about 15 months, he said.
Currently, all the apartments will be one- or two-bedroom units, Simpson said. He said it's too early to talk rents.
In addition to the apartments, the building is to hold 25,000 square feet of offices and 20,000 square feet of retail space on the ground floor, the company CEO said.
He said company officials are interested in seeking an incentive package from the city.
Simpson said the company bought the SunTrust Bank Building seven or eight years ago, which he said has been a successful investment. He said the company, in business since 1988, owns 80 properties in the Southeast.
Charlie Cooper, whose family owns three buildings sitting on Cherry Street just behind the proposed tower, said the project should help the entire block.
"The most important thing is to keep downtown vibrant," he said. "We've done it on the river. Now it needs to be done in the central city."
McGauley said the planned mixed-use project will be "absolutely catalytic" for the city's core.
"It will give it so much more energy and enthusiasm and go a long way to make the central city more of a 24/7 neighborhood," he said.
Amy Donahue, River City's marketing and communications manager, said the nonprofit group didn't ask food trucks to come back to the 700 block this spring as it eyed the site's redevelopment, though some have anyway.
"We've been working on this development for quite some time," she said.
Several new apartment buildings have been built or proposed in downtown Chattanooga in the past two decades, but nothing on the scale of the 700 block project outside of student housing near UTC.
A Memphis company unveiled plans earlier this year to convert nearly all of the historic Maclellan Building at 721 Broad St. into 90 residential units in a $13.5 million effort.
Wise Properties is building a four-story, 75,000-square-foot mixed-use building that will house commercial storefronts and 63 apartments at Market and Main streets.
Walnut Commons, a 100-unit apartment complex, opened in 2013 at Walnut Street and Aquarium Way.
Contact Mike Pare at mpare@timesfreepress.com or 423-757-6318.
This vacant lot was created when buildings were torn down 15 years ago for a project that did not materialize in the 700 block of Market Street. A company has bought the property, seen Thursday, May 14, 2015 in Chattanooga, and plans to redevelop the site.