Downtown Chattanooga’s Mountain City Club site may hold department store, event space, hotel

Buyer plans to start work within three to six months

Staff Photo by Matt Hamilton / The Mountain City Club at 729 Chestnut St. in downtown Chattanooga is shown in 2022. Officials are moving forward to potentially sell the club's longtime home.
Staff Photo by Matt Hamilton / The Mountain City Club at 729 Chestnut St. in downtown Chattanooga is shown in 2022. Officials are moving forward to potentially sell the club's longtime home.

Mountain City Club officials agreed Wednesday to potentially finalize a sale of its longtime downtown Chattanooga site, with the buyer planning a department store, event space and possible hotel.

Mark Schmissrauter, the 134-year-old business and social club's board president, called the action "a bittersweet process." But, he said in a statement, he's excited for the future of the club.

"This agreement will provide the Mountain City Club with substantial assets to quickly pursue a new home for its current and future members," Schmissrauter said. "The board has already identified a potential space."

(READ MORE: Mountain City Club considers its future)

The club wants to relocate into 10,000 square feet of leased space on the second floor of the Gilman building just across Eighth Street from the existing club at 729 Chestnut St. when the deal is finalized, he said by phone.

The proposed purchase price of the existing site, where the club was built in the 1970s, wasn't disclosed.

The Chattanooga development group DeFoor Brothers is planning to buy the property, businessman Byron DeFoor said in a phone interview.

DeFoor said they're looking at raising a multi-level building holding "a New York-style department store." He said he is under a confidentiality agreement and couldn't immediately reveal more details about the store.

Also, event space could go into the new structure that would save some of the Mountain City Club's history, DeFoor said.

In addition, a hotel could go on the site, but at this point that piece of the project is "up in the air," said DeFoor, who is involved in the development business with brother Ken. "There has been a change with the city and what their plans are."

DeFoor said he'd like to see work start within three to six months.

The club's downtown home is located in the West Village, where DeFoor Brothers has developed the Westin hotel and the Hotel Indigo. They also purchased the nearby Chattanooga Marriott, redeveloped the Hotel Bo and recently purchased the Bode hotel and renamed it the Hotel Clemons.

The West Village also holds small shops, restaurants, event space and parking.

In 2018, the club entertained an offer from Byron DeFoor for the property, which was rejected by the organization. But the club now has roughly half the 300 members it had then.

(READ MORE: Mountain City Club weighed earlier offer)

Schmissrauter said the club is close to agreeing on "a great new place to call home beginning in 2024."

He said the Gilman space, which is owned by the DeFoors, will allow the club "to attract new members, bring in more events, and continue to serve as a great home to our current members."

Schmissrauter said the club, which decades ago was known for prejudicial membership practices, is picking up more diverse individuals, and he wants to build on that trend.

Name change?

He said the club may even drop "Mountain" from its name.

"It may be City Club," Schmissrauter said, and offer "a whole different image."

He said about 75 members attended Wednesday's meeting and only four or five voted against the potential sale.

The proceeds of the sale, which will belong to the club and not individual members, will go to reduce debt, support operations and be reinvested, Schmissrauter said.

Club Vice President Zach Hurst cited Schmissrauter's "unprecedented four-year commitment to serving as club president."

"He was on-site seemingly every day throughout the crippling pandemic and put us in a position to maintain our location during that period," Hurst said in a statement. "Doing so allowed us, under his direction, to spend time considering the right future for this club, and we believe we have found just that."

The club's membership has declined over the past two decades, with an older facility failing to draw numbers of new members and events, officials said.

According to the Hamilton County Assessor of Property, the existing facility has 41,836 square feet and sits on 1.4 acres.

The club was first in a Samuel Patton-designed building at the southeast corner of Seventh and Cherry streets before moving to a space in the old First National Bank building on Broad Street — currently the home of Pinnacle Bank. In 1904, the club moved into a second permanent clubhouse on Chestnut Street before the existing building was constructed.

Contact Mike Pare at mpare@timesfreepress.com or 423-757-6318.

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