The new owners of the Patten Towers are seeking a 25-year tax break they say is key to renovating the former downtown hotel and preserving it as low-income housing.
John Shepard, with Nashville-based Elmington Capital Group, made the pitch to Chattanooga City Council members at their Tuesday agenda session. Elmington and San Francisco-based Belveron Real Estate Partners LLC bought the 110-year-old building in July.
Shepard said the building hasn't had an all-over makeover since it became an affordable housing site in 1978. All its 200 or so residents qualify for low-income housing.
Some parts of the elevators date from then, he said. Mechanical and fire safety systems aren't up to standard; there are major safety and pest issues, and the residents don't have access to fresh food, Shepard said.
"I feel it's imperative to raise the standard of living in that building and make it a place where I would feel comfortable for one of my relatives to live in," he said.
The property pays a bit under $147,000 a year in city taxes now, he said, plus about $35,000 for schools. The companies want to freeze the city tax bill for the term of the payment-in-lieu-of-tax (PILOT) agreement while letting the schools portion rise as the properties are reassessed.
If the council and Hamilton County commissioners both agree, the tax break will be worth about $2.7 million over the 25-year PILOT, he said. He promised to provide council members with additional financial information before their scheduled vote next week.
Plans call for renovations to be done one or two floors at a time. Residents may have to move temporarily but will move back into their newly furbished units when they're ready.
And, he said, the partners plan to restart Bingo's Market to give the residents access to fresh foods. The market was started as part of the Innovation District but closed in June.
Shepard said the partners will work with Causeway, the Enterprise Center and the YMCA to restart the market.
Contact staff writer Judy Walton at email@example.com or 423-757-6416.