Jon Kinsey, a principal with the Chattanooga Choo ChooThe owners of the Chattanooga Choo Choo hotel - including former Mayor Jon Kinsey - were paid $5.25 million for the seven acres on which Bluebird Row, an upscale, four-story, 283-unit apartment building is to be built at the Choo Choo complex.
Birmingham, Ala.-based Choo Choo Residences LLC, a subsidiary of LIV Development LLC, closed the sale Monday on the land for the $45 million apartment complex, which will have a full-size swimming pool, pet spa and 20-seat movie theater when it opens in the summer of 2018.
"We got a great developer that's getting ready to do some exciting work down there," Kinsey said. "This will be the most upscale apartment complex in the area. We think the site demanded that, and they're going to deliver that."
The sale price is equal to about $17 a square foot for the parcel, which is a good price for downtown land purchased for apartments but still a fraction of the sales price of land used for hotels, such as $38 per square foot paid by Holiday Inn Suites and $68 a square foot for The Edwin, a boutique hotel under construction near the Walnut Street pedestrian bridge, according to David Devaney, president of NAI Charter Real Estate Corp., which specializes in commercial real estate.
"You're talking $750,000 an acre for apartments, that's setting the mark for apartments," Devaney said.
The apartment's developer will knock down the Track 29, and the concert venue will move into the Centennial Center theater closer to Market Street.
Also to be knocked down to make way for Bluebird Row is Terminal Tower, a two-story brick building that's one of the oldest structures at the Chattanooga Choo Choo hotel, formerly Terminal Station.
That concerns Justin Strickland, an historic preservationist who wrote the book, "Chattanooga's Terminal Station."
"It is important to preserve one of Chattanooga's oldest buildings," Strickland said.
But Kinsey doesn't believe the building is significant enough to save.
"I've done an awful lot of historic buildings in Chattanooga, and that one is of minimal interest," he said.
Kinsey is one of the main partners of the group that bought the Choo Choo hotel complex in 1989, along with three other main partners: his son, Adam Kinsey, Frank Fowler and Ben Probasco. About 20 other local partners are involved.
About two-and-a-half years ago, Choo Choo Partners announced an $8 million "total redevelopment" of the hotel complex, which has included converting hotel buildings into apartments and adding two new eateries on Market Street: Stir and Frothy Monkey.
"We kicked it up more than a notch," Kinsey said. "We've got another restaurant we'll be announcing here in the not-too-distant future."
Kinsey and his wife recently moved into Passenger Flats, an apartment building at the Choo Choo, and they plan to move into the second phase of Passenger Flats that's under construction now. It will have larger apartments. They sold the condo they lived in on Williams Street.
The Choo Choo's owners are open to more development at their complex.
"We're always interested in partnering with new developers," Kinsey said. "It's a 24-acre site that has been greatly underutilized for a long time."
Contact staff writer Tim Omarzu at tomarzu @timesfreepress.com or www.facebook.com/MeetsForBusiness or on Twitter @meetforbusiness or 423-757-6651.