WASHINGTON, D.C. – September 27, 2013 – (RealEstateRama) — A planned $165 million development on the former Baptist Hospital site along Knoxville’s South Waterfront is moving forward, and the City of Knoxville and Knox County are proposing a tax-increment financing (TIF) transaction to support it. The proposed TIF would be authorized by an amendment to the existing Knoxville South Waterfront Redevelopment and Urban Renewal Plan, and would cover the property running along both sides of Blount Avenue from the Gay Street Bridge to just west of the Henley Bridge. A public hearing on the TIF proposal has been set for 4 p.m. on Thursday, Oct. 10th, at the KCDC offices at 901 N. Broadway.
In June, Blanchard & Calhoun Commercial Corporation of Augusta, Ga., announced plans to redevelop the approximately 24-acre site, which has sat largely vacant since the former hospital closed in 2008. The complex is slated to include luxury apartments, a student apartment complex, a hotel and restaurant, and retail and office space, with demolition and site work scheduled to begin by early 2014.
“I am thrilled that Blanchard & Calhoun Commercial is moving ahead with their plans for this very important property along our South Waterfront,” Mayor Madeline Rogero said. “The scale of reinvestment in this abandoned site in the heart of the city definitely meets our criteria for public infrastructure support. This will be a terrific boost to the economy of South Knoxville and the city as a whole.”
“I am very excited to see something happening with the former Baptist Hospital,” Knox County Mayor Tim Burchett said. “This development will provide significant economic growth in Knox County, but especially in South Knoxville where it is badly needed.”
The TIF would direct $22 million in new City and County property taxes over a period of 20 years to support this project. This is the largest redevelopment project ever considered for tax-increment financing in Knoxville. Public amenities planned on the project site include a public riverwalk running from the Gay Street Bridge to connect to the existing riverwalk at the Cityview complex west of the Henley Bridge, and a 23,000-square-foot public plaza connecting Blount Avenue to the riverwalk.
Even during the term of the TIF when portions of tax revenue are allocated to payment of debt service, City and County property tax collection will increase substantially from its current level. Bob Whetsel, Director of Redevelopment for the City of Knoxville, said that during the TIF period the site will generate an estimated $390,000 a year in City property taxes, and $183,000 a year in County property taxes. Last year, the property generated $86,422 in City taxes and $82,409 in County taxes.
After the public hearing on Oct. 10th, the TIF proposal is expected to go to City Council for approval on Oct. 15th; to County Commission on Oct. 28th; and to the KCDC Board on Oct. 31st. As the City’s designated redevelopment authority, KCDC administers all redevelopment areas.
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