Asheville Highway affordable apartments will reinvent dilapidated hotel property

Growing up, Carl Lansden often passed the Holiday Inn on Asheville Highway on the way to see his grandparents just a mile down the road.

When family visited from out of town, they often stayed at the now dilapidated motel. It was always an opportunity for Lansden to swim in the motel's pool.

"I would come by here 2,000 times a year," the developer, known for restoring historic homes, told Knox News.

After purchasing the property at 4625 Asheville Highway for $575,000 in 2017, Lansden has obtained the tax credits and fiscal support to fund its $20.2 million redevelopment. The motel property is located in Town Hall East, just northeast of Burlington.

The motel will be demolished to make way for The Ammons at Asheville Highway, an 80-unit apartment complex. Dubbed "workforce housing," The Ammons will charge below-market rents. It's intended to provide an affordable living situation for working people.

Knoxville residents need affordable rental options. One study published by Stessa earlier this year found that the median rent in the Knoxville metro area increased from $1,251 in March 2020 to $1,361 in March 2021, an increase of 8.8%.

"With a parcel this size (near) Burlington, I think it's going to be, it's such a big project, especially with what's going on with Amazon and East Towne (Mall) and all that," Lansden said. "It's going to bring more goods and services and restaurants and things of that nature here."

More: Stunning drone video shows Knoxville Center Mall destruction

What is 'workforce housing'?

Named for Lansden's grandparents, Gladys and Hugh Ammons, who were active members of the neighborhood, The Ammons will include four apartment buildings with 28 two-bedroom and 52 three-bedroom units. Each apartment will have two bathrooms and space for laundry.

The 6.8-acre property will include a business center, dog park and dog wash.

Workforce housing, according to national research firm Brookings Institute, is housing for households that earn too much to be eligible for traditional affordable housing subsidies like vouchers from the U.S. Department of Urban Development.

The term is controversial, because it implies that poorer households that receive subsidies are not employed, so some experts refer to it as "middle-income housing."

To qualify for residence at The Ammons, households will need to make less than 60% of the average median income. Tentative monthly rent will run about $1,060 a month for a three-bedroom and $829 a month for a two-bedroom.

"This is your this is your waitress, this is your mechanic," Lansden said of the intended tenants.

There are plenty of reasons to invest in housing for middle-income residents. It increases the tax base and decreases "the socioeconomic isolation of central-city low-income households," according to a 2010 study.

It keeps those individuals from moving into a lower-cost neighboring counties or cities, and those individuals spend money locally on groceries, entertainment and other goods.

The project is getting a $2 million grant from the City of Knoxville's affordable housing fund. The city has previously contributed to projects like Southside Flats, Restoration House, Middlebrook Gardens, Mineral Springs Apartments and Burlington Commons.

Knoxville Mayor Indya Kincannon's administration designated $8.1 million to support affordable housing in the 2021-22 budget. The affordable housing fund is a $50 million commitment over the next 10 years, according to a city press release.

"That doughnut hole in the budget was about $2 million," Lansden said. "So the city of Knoxville coming to the table, investing in that, in the workforce housing, it helped tremendously."

Holiday Inn property had many owners

Lansden first planned to restore the Holiday Inn into one-bedroom affordable senior housing. But one bedrooms don't generate enough income and the motel, built in the 1950s, was too far gone.

Lansden is perhaps best known for saving the Cooper D. Schmitt House from demolition by moving the 19th Century home in Fort Sanders to a new plot of land. He has restored historic residences in Old North Knox and Fourth and Gill. This is his first multifamily project.

He has a partner with experience in commercial real estate and affordable housing in Southeast Capital. Based in Knoxville, the firm developed Burlington Commons, a 59,000-square-foot, 50-unit low-income apartment complex with on-site playground and community laundry.

The Holiday Inn property has changed hands many times throughout the years. It was sold to Lucky Inns of America in 1947, according to property records. By 2005, its neighbor Chilhowee Hills Baptist Church purchased the property. In 2013, it was owned by Freedom Christian Academy before changing hands once more before Lansden purchased it.

"Growing up in this neighborhood, it's very rewarding," Lansden said. "It works out for the investors. It works out for the syndicators, for the developers, and especially for the tenants."

Demolition of the motel was slated to begin in late October and will take approximately 30 days. The construction process will take 16-18 months, Lansden estimated.

Davie Construction is the contractor and Emerald Housing Management will oversee the community. R. Len Johnson and Associates is the architect.

Up next, Lansden is planning a market rate multifamily property in West Knoxville and a RV park in Sevier County.

Growth and development editor Brenna McDermott can be reached at brenna.mcdermott@knoxnews.com. Follow along with her work on Twitter @_BrennaMcD. Support our local news efforts by becoming a Knox News subscriber.

This article originally appeared on Knoxville News Sentinel: Knoxville apartments: Affordable Housing near Burlington on the way