A Nashville developer eyeing $150 million in residential and commercial space next to a proposed new Chattanooga Lookouts stadium says "the stars are aligning" for a live-work-play district.
Mark Deutschmann, chief executive of Core Development, said Friday the company is looking at building 400 to 500 homes and up to 20,000 square feet of neighborhood-scale commercial space on 11 acres at the Wheland Foundry/U.S. Pipe tract.
Also, Core is in early discussions with others about the creation of a 35-acre public park neighboring the foundry site, he said. The vision for the park would be the product of a comprehensive community consultation process, Deutschmann said.
"Opportunities like this rarely come along and require focus, collaborative leadership and vision to be fully realized," he said in an email.
But Deutschmann added that building a high-quality, 18-hour-a-day neighborhood in the South Broad District is challenging without the proposed $86.5 million multi-use stadium or some other catalyst.
"The site has great potential given its location and improved interstate access," he said about the 141-acre parcel.
Chattanooga Mayor Tim Kelly and Hamilton County Mayor Jim Coppinger see the stadium, with the minor league baseball team as its primary user, as the linchpin of ultimately $1 billion in potential new development.
Officials have sought $20.8 million in state money for the stadium, $13.5 million in a direct appropriation along with $7.3 million for environmental remediation, though some legislators have raised questions about the request. The proposed stadium is expected to hold between 7,000 and 10,000 seats.
Deutschmann said the mostly vacant foundry parcel might be Chattanooga's last "urban ring neighborhood," or development around the city's downtown.
The stadium would dramatically accelerate the pace and quality of development in the district, he said. It would create "commercial viability, residential density, housing affordability and resulting in more efficient use of Chattanooga's urban land, which is limited and precious," the developer said.
He said he has seen such development occur in Nashville around the 10,000-seat minor league baseball stadium, which was built in 2015 for the Sounds. It's also taking place now around the Nashville SC soccer stadium, Deutschmann said.
"This impact is not merely economic in nature," he said. "If done properly, it will have an enduring impact on quality of life, creating strong and vibrant neighborhoods with great retail and commercial spaces."
Absent a stadium or some other catalyst, new construction in the South Broad District will likely be low-density, surface-parked residential with limited commercial space, Deutschmann said.
"The proposed stadium is a differentiator because it dramatically intensifies development, diversifies real estate product type and reduces time required to produce high-quality, mixed-use development," he said.
Core played a large role in the revitalization of Nashville's Germantown neighborhood, where the Sounds stadium is located, Deutschmann said.
"The investment into the Sounds stadium drove the transformation of stagnating light industrial land into a vibrant mix of office, retail and residential development that is now woven into the surrounding neighborhood," he said.
Core, which calls itself a boutique commercial development company, is focused on neighborhood-scale, mixed-use, urban infill, Deutschmann said. He said Core "has been at the forefront of Nashville's urban renaissance for almost 20 years."
Deutschmann said two of Core's founding partners and its chief financial officer were born and raised in Chattanooga.
"Core has been actively pursuing trail-oriented development opportunities and is intrigued by the public and private investment in the Riverwalk, public infrastructure and the relocation of the Lookouts stadium to the site," he said.
According to a proposal from Chattanooga and county leaders to the state, public money and tax revenues would pay for nearly two-thirds of the proposed stadium - not including the $7.3 million from the state for environmental cleanup of the area.
While the proposal calls for the $13.5 million state contribution, it also projects the use of state and local sales tax revenue totaling $15.6 million, incremental property tax revenue of $19.4 million from anticipated adjoining development and non-property tax revenue from the city and county of $8.4 million in a 50/50 split, figures show.
Meanwhile, private money includes lease payments by the Lookouts of $19.6 million and $10 million in contributed foundry land for the stadium.
But some legislators said a few weeks ago they're hesitant to support the one-time request for $20.8 million or a bill permitting the use of sales tax revenue to help pay off an estimated $63 million in 30-year bonds for construction.
State Sen. Todd Gardenhire, R-Chattanooga, said he wanted to see more information he believes is pertinent to the requests.
"And I'm not moving forward on this bill or this project until I'm satisfied this is in the taxpayers' benefit," he said during a Senate Finance Subcommittee meeting.
House Finance Committee chair Patsy Hazlewood, R-Signal Mountain, said the state already has invested $35 million in work now underway to remake the Interstate 24 interchanges near the foundry site.
"I think we were told, 'Give us the interchange and the development is going to follow.' So we already gave at the office in my perspective in that regard," she said in an interview. "I think it's a difficult sell for additional stadium dollars, to me."
But state Rep. Yusuf Hakeem, D-Chattanooga, said in a telephone interview he supports the stadium effort.
"I would like to see the project completed, but the reality is, we are going to have to look at the numbers, see what is being asked of the state and if that's doable," he said. "I think it would be a real asset to the community if we can go forward with it."
The Lookouts currently play at AT&T Field, a 6,340-seat facility near the riverfront that has housed the franchise since 2000.
In October 2020, Major League Baseball announced it would be taking over minor league operations. The change, baseball officials said, turned a preference for a new Lookouts stadium into a requirement if professional baseball is to stay in Chattanooga, as AT&T Field does not have the amenities needed for today's players while they climb the developmental ranks.