If you spend time in downtown Chattanooga, you’ve undoubtedly noticed an influx of new apartment buildings, and you’ve probably noticed some vacant retail and office space as well. Though our area has seen years of growth, development and national recognition, perhaps you wonder if we’ve overbuilt high-end rental housing while neglecting to use available commercial space. Turns out, it’s not that simple, and real estate experts say to be patient.
Aaron White, Principal and Co-Founder of Evergreen Real Estate, a private real estate development company with a portfolio of 2,500 units in Chattanooga, Knoxville, Nashville and other Southeastern cities, owns several apartment communities in the Chattanooga area – including Northshore Village and Vista Cameron Harbor. White says Northshore Village is 99 percent occupied with Vista Cameron Harbor at 97 percent. Northshore Village floor plans range from $780 to $1,200 monthly, while Vista’s start at $970 and go up to $1,800. Both are popular with residents. “The only thing that’s changed in Chattanooga is for the first time ever there’s a fair amount of apartments downtown,” White says. “But it’s new supply in a small market, so vacancies go up because it’s brand new product and hasn’t had time to get absorbed.”
What is Class A office space?
Office buildings can fall into a few categories: Class A, Class B or Class C. Features of each classification vary by market, but generally Class A represents the best quality — the latest tech, great location, entirely updated. Class B is a step down, perhaps older but still functional. Minor renovations could seriously upgrade these spaces. Class C properties, the lowest tier, require extensive renovation and are the most outdated of the three groups.
Vista Cameron Harbor
Vista Cameron HarborWhite speaks to the much-touted positive aspects of our area: state tax structure favorable for both businesses and individuals, reasonable cost of living, close to other major cities, outdoor recreation – the list goes on. People love it here. “I can’t say all that about many other cities, and of the ones I can, Chattanooga is significantly more affordable than they are, and has some of the most desirable real estate in the state.”
White says he’s seeing solid demand for apartments and condos. Evergreen built more than 100 over the summer, and more than half have sold. “While I’m not going to go build three new apartment products in Chattanooga right now, I’m not at all nervous about what is being built today. It’s a healthy market. I can’t say it’s perfectly at equilibrium, but it’s not crazy. It doesn’t scare me.”