One of the highest profile corners on the edge of downtown Chattanooga will see student housing as a developer prepares to build a 456-bed, $38 million apartment building.
Demolition work has started near the corner of McCallie and Central avenues where a Roanoke, Va.-based company plans to put 138 units aimed at nearby University of Tennessee at Chattanooga students.
"It's hard to assemble property in a downtown location. It's got a lot of visibility," Wes Bradley, president of University Housing Group, said about the corner a few blocks from UTC that will hold the apartment building called Central Flats.
Bradley said he thinks the student housing market is under-served, even though work is ongoing on a 600-bed, $80 million West Campus dorm at UTC at Vine and Houston streets that's to open in about a year.
› What: 138-unit apartment building with 456 beds
› Where: McCallie and Central avenues
› Parking: 374 spaces in a four-level garage
› Cost: $38 million
› Opening: Summer 2019
Source: University Housing Group
Last fall, the 691-bed Douglas Heights apartments opened near campus, and a handful of other smaller apartment complexes have been added along Vine, Houston, Eighth and Lindsay streets near the campus downtown.
The latest apartment building, five stories high on McCallie and four stories where it backs up against Oak Street, will also hold a four-level parking garage with 374 spaces, Bradley said.
Plans are to begin full construction at the site next March with the apartments ready to open in summer 2019, he said.
Kim White, who heads the nonprofit redevelopment group River City Co., said UTC plans to spend $8 million on intramural facilities off O'Neal Street not far from the planned new apartments.
Also, she said, a sorority is eyeing a building on O'Neal Street as the campus spreads east.
"We're excited about the changes to the Central-O'Neal Street corridor," White said.
Kanta Chaudhari, manager of Kanku's convenience store across McCallie from the planned apartment building, said she's glad to see the university's continued growth.
"It will be very, very good," she said. "We're real excited to have them."
Bradley said the additional student housing creates more opportunity for retail space to open up in the area.
He said it's still early to firmly set rents, but he expects they'll run just under $700 a month per person for space in the four bedroom units and $850 a month per person for space in the two-bedroom apartments.
Amy Donahue, River City's marketing director, said a big selling point to the array of new off-campus housing is the ability for students to live close enough to walk to classes and not have to drive.
"That's a big convenience," she said. "You've got to have a mix of on- and off-campus housing for students."
Bradley's company, which is 30 years old and was started by his father, has a project in Knoxville and is looking at another in Reno, Nev. Also, he said, it manages properties in Western North Carolina and in Fayetteville, Ark.
"We think Chattanooga has a lot going for it," he said. "We like the university, the university system and the downtown campus. Kids like an urban setting."
Bradley said his company is not seeking financial incentives from the city.
Contact Mike Pare at email@example.com or 423-757-6318.