Mountain City Club to weigh offer to buy downtown Chattanooga property

Staff Photo by Matt Hamilton / The Mountain City Club at 729 Chestnut St. is shown Nov. 30. Members plan to meet next month to consider an offer to buy the property.
Staff Photo by Matt Hamilton / The Mountain City Club at 729 Chestnut St. is shown Nov. 30. Members plan to meet next month to consider an offer to buy the property.

A potential buyer has emerged for the longtime home of the Mountain City Club in downtown Chattanooga, according to an email from the club's president.

Mountain City Club members are to hold a special meeting Nov. 2 to hear about the possible deal that would require their approval regarding the 729 Chestnut St. site, said club President Mark M. Schmissrauter in the email.

"The board has been presented a proposed transaction that involves the sale of substantial Mountain City Club assets," he said. "A potential buyer has offered to purchase the Mountain City Club building."

(READ MORE: Mountain City Club considers its future)

As part of the transaction, the club would lease space in another building under a long-term deal, Schmissrauter said.

He said the terms of the proposal are subject to certain conditions and a due diligence process.

At the meeting, the board plans to discuss added details with members and hold a vote to determine whether to proceed, the club president said.

Schmissrauter did not immediately return a phone call or email about the proposal Wednesday.

But in an email to members in June, the president of the 124-year-old business social club cited years of decline in its numbers, most recently spurred by the pandemic.

"The reality is membership numbers have been falling for many years now, if not decades," he said at the time. "We need to find a solution to this consistent problem that negatively impacts the club's financial position."

The club's downtown home, in the West Village, has had interest from multiple real estate investors.

The property, which includes a large parking lot, sits amid the hotel, restaurant, shopping and conference district created by Chattanooga developers and brothers Byron and Ken DeFoor.

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

(READ MORE: Mountain City Club considered earlier offer)

Byron DeFoor couldn't be reached for comment Wednesday, but he has continued to express an interest in growing the West Village, where the DeFoor Brothers' holdings include the Westin hotel directly across Pine Street from the club.

Several months ago, DeFoor Hospitality added a fifth hotel in the district when it acquired the former Bode Hotel at Chestnut and Eighth streets, also directly across from the club, for $17.5 million.

The DeFoors have renamed the 54-room inn the Hotel Clemons. For many years, the structure was known as the Clemons Bros. furniture manufacturing and sales building.

In June, club members expressed an appreciation for their venue for business meetings, meals and socializing.

Ken Goodhue said in an interview he joined the club 40 years ago and it would be "heartbreaking" if it went away.

"It has always been a great place to go," he said. "It's special."

Jerry Summers said he joined in 1985 and would miss it.

"It has been a good place ... a fun place," he said in an interview.

In 2018, when the club decided against selling its three-level facility, its leadership said it had raised "significant funds" to help ensure its longevity. Schmissrauter said then the club "has very strong equity."

A major remodel several years ago at the building yielded cosmetic improvements and a new business center, wireless internet and meeting rooms with video screens for private conferences in an effort to woo more members.

The club has counted well-known city fathers like Adolph Ochs, Samuel Patton and Harry Scott Probasco among its founding members.

But there have been questions by officials of whether there was still a market for a club like the Mountain City Club. The club dropped many exclusionary membership traditions and sought to attract younger and more diverse members.

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

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