Pace is slow, need is high for affordable housing in Chattanooga

Sarah Grace Taylor, Chattanooga Times Free Press, Tenn.
·4 min read

May 1—The creation of new affordable housing units in Chattanooga has made some headway in recent years, but the processes are slow and the need is high, local affordable housing advocates said.

"For anybody who keeps saying, 'Why aren't we building affordable housing?' it's just that the costs are so expensive," said Martina Guilfoil, CEO of Chattanooga Neighborhood Enterprise, a housing development nonprofit group with a waiting list of Chattanoogans in need of affordable housing. "Plain and simple, the numbers don't work."

A patchwork of federal, state and local programs requires a lot of expertise — and a great deal of patience — to work through to make affordable housing projects successful, said Heather Bradley-Geary, director of Supportive Housing for the Missouri-based Vecino Group. Vecino has worked for more than a year to establish low-income housing in a property on West Main Street.

"There are programs out there dedicated to affordable and supportive housing, but navigating them is difficult," Bradley-Geary said.

Chestnut Flats, an affordable housing complex of 199 apartments on Chattanooga's Southside, opened in the fall of 2019, becoming the biggest new federally subsidized affordable housing project in Hamilton County since 2007, according to developers at Elmington Capital Group.

Federal tax credits allocated through the Tennessee Housing Development Agency combined with local property tax breaks and a brownfield redevelopment grant to help finance the project, which the developer said totaled nearly $25 million. The complex is fully occupied.

In January 2021, the city's Health, Educational and Housing Facility Board gave preliminary approval of up to $35 million in multi-family revenue bonds to finance an affordable housing complex in Alton Park called The Reserve at Mountain Pass.

Plans are to start construction by mid-summer, with the first units opening in the third quarter of 2022, according to developer LDG Multifamily.

In February, the same city board endorsed a 47-unit affordable apartment complex planned for Highland Park by CNE.

The board gave its OK to tax incentives in the form of a 10-year payment in lieu of tax agreement with CNE. In addition, $360,000 in federal grant money from a U.S. Housing and Urban Development fund that comes to Chattanooga will be used for the project.

The city also has a land bank, a collection of properties owned by the city that could, in theory, be developed to add to the housing stock. But the land bank is not a panacea, Guilfoil said, citing the cost of building a home.

"In most of the cases where the city owns land, the challenge will be building so that you're not even underwater," she said, noting that many of the areas where the city owns land won't lend themselves to sales that will cover construction costs. "But it helps. It's a piece of it."

Another piece of the puzzle is adding existing units back into the affordable housing market, whether by repairing rundown homes or convincing more property owners to rent to those who need it, she said.

"Part of that would be a rental rehab fund to address eradicating people from blighted conditions in existing housing that they're living in," Guilfoil said. "And that's a huge issue.

"If a landlord wants to improve their property they have to go in and eradicate all the lead, and it's expensive."

Newly elected Chattanooga Mayor Tim Kelly addressed several of these strategies during his campaign and has committed to affordable housing as one of his highest priorities in office.

"Chattanooga can be a city where all of our residents have access to housing options that work for them and their family. But to get there, we need to get serious about density and making full use of the tools we have available," Mayor Tim Kelly said. "I have directed my administration to explore how we can better leverage our land bank and city-owned properties for infill housing development, preserve affordability with community land trusts, and expand the available housing stock with accessory dwelling units."

Staff Writer Mary Fortune contributed to this report.

Contact Sarah Grace Taylor at or 423-757-6416. Follow her on Twitter @_sarahgtaylor.