His $17.8 million purchase of the office building at the corner of Riverfront Parkway and Main Street was a good indication of Dave Codrea's enthusiasm for Chattanooga — and he's just getting started.
Codrea's Greenleaf Partners LLC bought the building at 1301 Riverfront Parkway in September, and next plans to pick up the Lupton Building at 1010 Georgia Ave. The 109-year-old structure is on the block for $3.5 million, with the sale to Greenleaf pending. Codrea declined to disclose the agreed purchase price for the Lupton Building, but he expects to close by the end of October and then invest multiples of that price in renovations to the six-story building.
"I think Chattanooga is a fantastic market and we'd love to be up there more," said Codrea, who founded Greenleaf Partners in Atlanta about a decade ago. "We're very bullish on Chattanooga."
The Riverfront Parkway building, constructed in 1954 and renovated about 10 years ago, doesn't have much in common with the Lupton Building, which has been used as self-storage facility and will require a total overhaul. But they are both part of the Opportunity Zone, which gives capital tax gain breaks to developers who invest in designated areas.
"Downtown Chattanooga as a whole is an Opportunity Zone, and you seldom see a zone that covers that much of a great city," Codrea said.
To qualify for the tax breaks, buyers have to make substantial investments in the property — which means the Riverfront Parkway building won't deliver those perks. But the Lupton Building will be a long-term project, and is in both the Opportunity Zone and in the heart of the city's Innovation District.
Local architect Craig Kronenberg is working with Codrea on plans for the Lupton Building, which he called "a very cool project that has a lot of potential." Early plans for the 55,000-square-foot building call for a hostel on one of the upper floors, retail on the ground floor, and creative office space on the mid-floors, Kronenberg said.
The office building on Riverfront Parkway won't require any substantial work — just a few small tweaks to get it in shape for LEED certification, Codrea said. The occupants have long-term leases, the 112,00-square-foot building is full, and there's no plan to do anything but meet the tenants and operate the property, Codrea said.
"We're a long-term holder that likes to buy stuff and operate it ourselves," he said. "We're a family company, very much not a big institutional fund."
It's exciting to have property adjacent to the former Alstom site, where the new owners plan to build a model for mixed-use projects that include industry alongside residential, retail and recreational areas on the 112-acre site, Codrea said.
"The plans they have look incredible," he said.
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