Chattanooga motel converts to 100 studios to provide workforce housing

The owner of a Motel 6 in Chattanooga is considering converting the unit to apartments to provide housing for the workforce in the Brainerd area.

“We see a great need for this,” said Harry Patel, chief financial officer of Atlanta-based company JDH Developers.

Patel said in a phone interview that plans call for 100 one-bedroom studios. The company is looking to rezone the 2-acre site at 5505 Brainerd Road from the city.

“We’re going back to the rooms and totally renovating them,” he said.

Rents will likely hit the $1,000 to $1,200 per month range, the developer said. Units should be fully furnished, with large refrigerators and 50-inch flat-screen TVs, Patel said.

As well as redoing the units from hotel rooms to apartments, he said there are plans to add a gym and likely a barbecue area, gazebo and possibly a small cafe.

“He will have heavy landscaping and a new signing,” Patel said.

Additionally, prospective residents would need to undergo a full background check and likely sign a minimum one-year lease, he said.

He estimated the cost of the hotel overhaul at between $1 million and $1.5 million. Work could start in two or three months and the renovation will take another four or five months, Patel said.

Given the Chattanooga hospitals located in the area, he said he considered nurses as potential residents. Additionally, due to the number of restaurants along Brainerd Road, workers at those locations may also be tenants, Patel said.

The proposed hotel conversion comes as Chattanooga Mayor Tim Kelly revealed plans earlier this year for a five-year, $100 million affordable housing initiative.

“In a very real way, Chattanooga is facing a crossroads,” the mayor said, adding that housing affordability is increasingly intolerable and is helping to drive back homelessness.

Kelly said he expects thousands of affordable housing units to be created and rehabilitated in what the city calls 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 downtown Westside would be home to some of the new or renovated affordable units.

Patel said his group bought Motel 6 about three years ago and spent about $4 million renovating it at that time.

But his company now has 18 conversion projects underway in other locations to meet the need for more affordable housing, he said.

Recently, Patel said, JDH Developers completed three similar transformations in Rome, Georgia.

In Chattanooga, the average rent for a two-bedroom apartment between 2016 and 2021 has risen from $775 to $1,150, according to a recent report by the Eviction Prevention Initiative.

A more recent study published in Zumper’s National Rent Report indicates that the average rent for a one-bedroom apartment in Chatanooga rose 4.3% from a year ago to $1,210 per year. month and the average rent for a two-bedroom apartment in Chattanooga increased by 15.3%. from a year ago at $1,360 per month.

Contact Mike Pare at [email protected] or 423-757-6318. Follow him on Twitter @MikePareTFP.

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