Developers say downtown properties filling up

Developers say downtown properties filling up

March 27th, 2011 by Ellis Smith in Chattamoms

Hayden Place, shown here during construction, is a luxury apartment complex on Pineville Road at the foot of Signal Mountain. The gated community features hardwood flooring, a pool and fitness center and concierge service. Staff File Photo.


Rental housing is near capacity, as developers rush to relieve a system that is bursting at the seams. A 2010 report said citywide occupancy rates were near 96.8 percent, after growing by 4.2 percent over the year.

* Average unit size - 962 square feet

* Average rental rate - $716 per month

* Average rental rate per square foot - 74 cents

* Growth in rental rate over the year - 7 percent

* East Ridge occupancy rate - 96.5 percent

* Southside occupancy rate - 97.6 percent

* North Shore occupancy - 95.8 percent

Source: Chattanooga Apartment Association

Local real estate leaders say renters are more important to Chattanooga's real estate business than ever.

Many owners who haven't been able to sell their property are renting, according to Jennifer Grayson, president of the Greater Chattanooga Association of Realtors.

"About 30 percent of properties that were built to be sold are getting leased," Grayson said.

The Chattanooga apartment market is officially in recovery, according to Real Data Apartment Market Research.

"Downtown is filling up the fastest, and it seems like the less-expensive stuff is gone," said Stephanie Keys, managing broker at Waldorf Property Management.

Three apartment complexes are currently in the construction pipeline, and two additional communities are planned for the area.

"I'm sure we can expect the increase in rentals to increase through 2011," said Darlene Brown, owner and broker with Real Estate Partners.

Still, there is a growing demand for "more diverse" housing, according to John Bridger, executive director of the Regional Planning Agency.

"We're seeing a lot of people moving into the area who want to live somewhere for a short period, it's become an increasingly important part of our business," said Marcus Lyons, leasing agent for Real Estate Partners.