A Los Angeles real estate investment trust plans to buy one of Chattanooga's biggest downtown apartment complexes.
The Chattanooga Health, Educational and Housing Facilities Board this week authorized the transfer of $2 million of property tax breaks to allow Mount Auburn Multifamily to acquire the 1400 Chestnut building on Chattanooga's Southside. The 200-unit was proposed in 2015 by the Birmingham, Alabama-based development firm Kore LLC which opened the facility in 2017.
The 5-story complex includes a swimming pool, fitness center, dog spa and parking garage and includes one- and two-bedroom apartments, ranging in size from $1,225 to $1,763 a month.
To qualify for property tax breaks, the developers have set aside 40 of its units for low- and moderate-income residents and 31 of those units were full in a housing report prepared in February. Brian Minshew of 1400 Chestnut said at the time that the price point, $864 a month for the one-bedroom units, is good for that area of the city.
With nearly $1.2 billion dollars of private investment in the downtown area since 2015, River City Co. said the central city and nearby Southside and North Shore have added 3,223 apartment units and 1,917 beds for students at the University of Tennessee at Chattanooga since 2015.
Joseph Holt, principal with Kore Co., said the developers of 1400 Chestnut were drawn the Chattanooga because of the growth of its downtown rental market.
"I've been in the apartment business covering the Southeast for a number of years and Chattanooga is one of exciting markets that we have seen in terms of growth," Holt told he city housing board. "We look at a lot of different markets and we felt like downtown Chattanooga was an exciting place to develop a project. We're very proud of this project."
Mount Auburn is preparing to close on the purchase with the endorsement of the exchange by the city housing board.
Since its start in 2004, Mount Auburn has already made more than $1 billion of acquisitions and currently operates more than 10,000 apartment units and has more than 200 employees across the country.
The company bought the 249-unit Peyton Stakes apartments in Nashville last year and in 2017 the company acquired two Knoxville apartment complexes — the 248-unit Marble Alley and the 236-unit Walden Legacy.
Contact Dave Flessner at firstname.lastname@example.org or at 757-6340.