Multifamily Conversion

Highlights

• 23,631 SF hotel property offered as multifamily conversation opportunity
• 186 studio apartment (209 SF each)
• Zoned C-G-1 (General Commercial Zoning District) with multi-family dwelling permitted use already approved
• Full package of required permits, plans, survey, clean Phase 1 report along with the city’s multifamily zoning– a great deal of money and time that the buyer does not have to spend!
• Partially operational hotel with cash flow in place
• Versatile property for multifamily real estate investors, including options for student housing or extended stay
• Located in a high dense, growing city with high demand for apartments housing.
• Located 5 miles from the University of Tennessee (28,000 students)
• Just 6 minutes’ drive from everything downtown has to offer: restaurants, entertainment, shops, business establishments.
• Friendly local government offering variety of incentives and tax programs for developers

Description

Golden Group Real Estate, as exclusive agent for the Seller, is pleased to present an exceptional multifamily conversion opportunity in Knoxville, TN. Located in the heart of East Tennessee, Knoxville sits at the crossroads of I-75, I-40 and I-81. It is the third largest city in the state, with the nine-county metro area comprising close to 900,000 residents. The area is home to The University of Tennessee with 28,000 students, and corporate headquarters such as The Pilot Company, Bush Brothers, PetSafe, Clayton Homes, Jewelry Television and Regal Cinemas. Set in the foothills of the Smoky Mountains, America’s most visited national park, Knoxville’s combination of history and nature is loved by locals and visitors alike.

The subject property is just 3.4 miles or 6 minutes’ drive from everything downtown has to offer. Located off Interstate 40, this hotel is a 5-minute drive from the Tennessee River Boat Company, less than a 10-minute drive from the Discovery Center and Knoxville Zoological Gardens, and 5 miles from the University of Tennessee.

This 23,631 SF property, known as The Inn of Knoxville, originally built in 1976 as a motel, offers 186 studio apartment (209 SF each) and is zoned C-G-1 (General Commercial Zoning District). Multi-family dwelling is a permitted use in this zoning designation.

Subject Property consists of three irregular-shaped parcels of land that total approximately 3.9 acres and is currently developed with three structures for commercial purposes which includes two three-story motel buildings and a restaurant building. The motel buildings total approximately 17,952 square feet and the restaurant totals 5,679 square feet.

Positioned for conversion to multifamily housing, this property presents an ideal opportunity for investors seeking to repurpose hotel space. With its efficient layout and design, this property is well-suited for rental apartment demand, as well as student housing, or extended stay in the growing Knoxville area. The partially operational hotel (the ___ wing of the property is currently being rented by guests on extended stay basis) comes with existing in-place cash flow. This cash flow will help to offset some of the construction costs associated with the conversion of the vacant side of the property (the ___ wing of the hotel) in the first stage of redevelopment. The rent from ____ wing is collected from $350 to $500 a week for 60 rooms that are currently being used.

At closing the Seller will provide the Buyer- developer a full package of required permits, plans, survey, clean Phase 1 report along with the city’s multifamily zoning– a great deal of money and time that the buyer does not have to spend!

Knoxville, TN is a large, highly dense city (1,900.6 people per square mile). Population density is higher than Chattanooga, TN (1,278/square mile) & Nashville, TN (1,405/ square mile). Due to its economic development efforts Knoxville has been seeing increasing in-flow of commuters – i.e. more people coming to Knoxville for job purposes then going out. Knoxville is considered the 26th fastest growing metro in the country. The property is very well suited as a multifamily, apartment development. Data supports the renting trend is growing. 54% of town population rents rather than owns. Rent has been increasing steadily. Compared to a year ago, Knoxville, Tennessee apartments have recorded a 17% rent increase. Renters take up 54% of Knoxville, TN real estate, occupying a total of 43,837 units, while homeowners live in 37,129 properties.

Higher density, higher supply of housing dictates that the target rent even for newly renovated modern-style fully furnished apartments with community amenities, and utilities should be targeted between $1,225 and $1,350 per month. According to the seller’s stabilized proforma, the 1st year NOI is expected to be at $1,781,841. (See Stabilized Proforma figures on page ___ of this offering).

Investors looking to make a meaningful impact in the community by converting hotel space into multifamily housing will find this property a compelling and promising opportunity.

Located in the heart of East Tennessee, Knoxville sits at the crossroads of I-75, I-40 and I-81. It is the third largest city in the state, with the nine-county metro area comprising close to 900,000 residents. The subject property is just 3.4 miles or 6 minutes’ drive from everything downtown has to offer. Located off Interstate 40, this hotel is a 5-minute drive from the Tennessee River Boat Company, less than a 10-minute drive from the Discovery Center and Knoxville Zoological Gardens, and 5 miles from the University of Tennessee.