Red Bank apartment complex sells for nearly $18 million

Photo by Dave Flessner / The Views of Signal apartments on Morrison Springs Road, seen Friday, was bought this week by Rise Properties for nearly $17.8 million.
Photo by Dave Flessner / The Views of Signal apartments on Morrison Springs Road, seen Friday, was bought this week by Rise Properties for nearly $17.8 million.

A Chattanooga development firm has bought a Red Bank apartment complex for nearly $17.8 million, or 40% more than what the property sold for two years ago as investors continue to bid up the prices for multifamily housing.

Rise Properties acquired The Views at Signal Mountain, a 124-unit apartment complex at 701 Morrison Springs Road, for the equivalent of $142,500 per unit. In 2020, an Atlanta investment group, Beechwood Holdings, paid $12.5 million to acquire The Views at Signal Mountain, or an average of $100,806 per unit.

Matt Phillips, managing partner for Rise Properties, said the apartment complex is well located with attractive amenities, including a swimming pool, fitness studio and Wi-Fi lounge with coffee bar.

"It's a beautiful setting close to great schools and near Highway 27," Phillips said in a telephone interview. "It also provides us an opportunity to do some further renovation of the property."

Phillips said the new owners have employed Brookside Properties to manage The Views at Signal Mountain and are planning on refurbishing and upgrading some of the facades, porches and common areas around the pool. The two-story townhome development includes 108,864 square feet and was originally built in 1973, according to the Hamilton County assessor.

The Red Bank apartment complex is the third multi-family housing development that Rise Properties has bought and is their first in Chattanooga, Phillips said. The Chattanooga-based developers primarily work in commercial and industrial property development, including the $102 million industrial park Rise Properties is building on part of the former DuPont site in Hixson, next to the Kordsa plant.

Two-bed apartments at The Views at Signal Mountain currently lease for $1,085 to $1149, according to Apartments.com, which is below the average rate for the Chattanooga area.

A year-end study by Zumper found that the average rental rate for a two-bedroom apartment in Chattanooga rose last year by 19% to $1,440. While most markets were showing a decline in rental rates at the year's end, rents were still rising this fall in Chattanooga, according to the Zumper National Report.

Rising rents have helped attract more buying interest in multifamily housing in Chattanooga. Last year, the biggest real estate sales in Hamilton County were all of apartment complexes, generating a total of more than $600 million of multi-family housing sales in 2021, according to the Hamilton County Register of Deeds.

Contact Dave Flessner at dflessner@timesfreepress.com or 423-757-6340.

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