The owner of a Motel 6 in Chattanooga plans to convert the lodging into apartments to supply workforce housing to the Brainerd area.
"We're seeing a big need for this," said Harry Patel, chief financial officer for the Atlanta firm JDH Developers.
Patel said in a telephone interview that plans call for creating 100 one-bedroom studio apartments. The company is seeking rezoning of the 2-acre site at 5505 Brainerd Road from the city.
"We go back into the rooms and totally renovate them," he said.
Rents likely will hit the $1,000 to $1,200 a month range, said the developer. Units are to be fully furnished, with large refrigerators and 50-inch flatscreen TVs, Patel said.
In addition to remaking the units from hotel rooms to apartments, he said plans are to add a gym and likely a barbecue area, gazebo and maybe a small coffee bar.
"It will have heavy landscaping and a new signature," Patel said.
Also, prospective residents are expected to undergo full background checks, and probably sign a year-long lease at a minimum, he said.
He estimated the cost of remaking the hotel at $1 million to $1.5 million. Work could start in two or three months and renovation will take another four or five months, Patel said.
Given the Chattanooga hospitals located in the area, he said he sees nurses as potential residents. Also, due to the number of restaurants up and down Brainerd Road, workers at those locations also may be renters, Patel said.
The proposed hotel conversion comes as Chattanooga Mayor Tim Kelly earlier this year revealed plans for a $100 million affordable housing initiative over five years.
"In a very real way, Chattanooga faces a crossroads," the mayor said, adding that housing affordability is increasingly intolerable and helping drive homelessness.
Kelly said he expected that thousands of affordable homes will be created and rehabilitated in what the city is calling the largest such effort in its history.
He said the effort will involve apartments, single-family homes, duplexes and other housing types across the city. Kelly said he imagined the city's Westside of downtown will hold some of the new or rehabbed affordable units.
Patel said his group purchased the Motel 6 about three years ago and spent about $4 million on its renovation at that time.
But his company now has 18 conversion projects in the pipeline at other locations to meet the need for more affordable housing, he said.
Recently, Patel said, JDH Developers completed three similar makeovers in Rome, Georgia.
In Chattanooga, the average rent for a two-bedroom apartment between 2016 and 2021 grew from $775 to $1,150, according to a recent report by the Eviction Prevention Initiative.
A more recent study reported in the Zumper National Rent Report said the average rent for a one-bedroom apartment in Chatanooga rose 4.3% from a year ago to $1,210 a month and the average rent for a two-bedroom apartment in Chattanooga was up 15.3% from a year ago to $1,360 a month.
Contact Mike Pare at mpare@timesfreepress.com or 423-757-6318. Follow him on Twitter @MikePareTFP.