Rebuilding Chattanooga neighborhoods in a ‘sustainable’ way

To understand where the best “affordable housing” production in the US is heading, an organization worth studying is Chattanooga Neighborhood Enterprise (CNE). Founded in 1986 after participants in a Chattanooga “community visioning” process agreed on the need to eliminate substandard housing, CNE started out aggressively developing affordable housing. But in recent years, says Robert McNutt, it’s become clear that low-priced housing cannot by itself reverse neighborhood decay. Consequently CNE, a nonprofit organization and full-service real estate company with a staff of about 50, now tries to produce something more complicated: neighborhoods that have a mix of incomes and that embody new urban design principles. McNutt, senior vice president for development, presents Chattanooga’s Martin Luther King neighborhood as an example of how to bring about a blend of “affordable” and market-rate housing in an old part of the city. “There hadn’t been a real estate sign in ML King in 25 years,” says McNutt, a man with both intellectual and hands-on skills — he earned a Ph.D. in literature at Indiana University, taught college courses part time, but also ran his own cabinetmaking shop and renovated houses before joining CNE in 2000. Many of ML King’s single-family houses, on the southeast edge of downtown, had been boarded up or rented on a short-term basis. CNE went into ML King in 2002 with the intention of strengthening the neighborhood and making it an appealing place for people of varied financial means. The organization renovated nine houses and sold them for about $70 to $80 a square foot, helped by “a lot of subsidy,” he says. CNE also put up new houses. “The first sold for $144,000,” a remarkably high price for a long-depressed area, according to Donna Williams, a real estate consultant hired by a local nonprofit initiative called ML King Tomorrow. By the time the project is completed, about 150 dwellings will have been rehabilitated or built from scratch. Among the people McNutt has worked with are small and minority builders, many of whom needed training in order to produce houses that would fit the traditional neighborhood concept and reach a receptive market. “We taught the builders to build on narrow lots,” McNutt observes. “They should line houses up with each other. They should get the house off steroids” — construct a smaller house, but with high-quality materials and good proportions. “We need about $100 a square foot,” McNutt says. At that level, it’s possible to build with “wood floors, nine-foot ceilings, HardiPlank siding, eight-foot-deep porches (or at least six feet deep), nice plain, elegant cabinets, laminate countertops, brick porches,” he observes. Subsidies such as a sewer tap fee payment of $2,000 help persuade builders to accept CNE’s standards, says Sarah Morgan, program officer for the Lyndhurst Foundation, which supports the neighborhood project financially and has backed CNE’s other endeavors. “We need the hook to enforce the design,” Morgan says. modest size leads to affordability By prevailing American standards, the new houses produced by CNE are modest in size — mostly 1,200 to 1,400 square feet. Many sit on 25-foot-wide lots. “If we sell them for about $120,000 or $130,000, we can cover the construction and soft cost,” McNutt says.” The designs themselves are varied. In the ML King neighborhood, CNE has overseen detached houses, townhouses, condominium flats, “all different kinds of product, with a different look and a different feel,” Morgan says. A group of four larger houses sold for $191,000 to $260,000. CNE intends to outfit a former school with 14 loft condo units. So far, CNE has built or rehabilitated about 50 housing units in the neighborhood and expects work on the final 100 to proceed quickly. Buyers have been about evenly split between whites and blacks. The University of Tennessee provides a $15,000 homebuyer incentive for faculty and staff members who buy in the neighborhood and stay for five years. “The fact that we did have a plan for the neighborhood was very important,” Morgan emphasizes. The plan included a new elementary school (completed two years ago), a community park, and a mile-long greenway to the local University of Tennessee campus and to the riverfront. A crucial element was conversion of two broad one-way streets used by commuters — McCallie Avenue and Martin Luther King Boulevard — to two-way. “A lot of potential investors said they wouldn’t want to be on the street unless it was converted,” says Karen Hundt, director of the Planning & Design Studio in the Regional Planning Agency. The university, whose Chattanooga campus is in the western portion of the neighborhood, strenuously argued for the street conversions, to slow traffic down and make the streets safer and more comfortable for students, faculty, and staff. The city’s decision prompted the university to go ahead with construction of hundreds of apartments, which in turn will generate a larger population base and presumably help entice retail — now scarce — to locate there. CNE, the biggest nonprofit housing developer in Chattanooga, is able to take on about two neighborhoods at a time. Another project that CNE has worked on recently is Cowart Place, an eight-block mixed-use, mixed-income development on a former car dealership property and vacant lots in the Southside district, south of downtown. That $3 million project, which has a pedestrian-oriented streetscape, was designed by BCA Chattanooga Studios and TWH Architects. CNE’s evolution points up an emerging trend in neighborhood revitalization: an attempt to make shrewder judgments about where to invest public and philanthropic funds. McNutt says a city can evaluate neighborhoods to determine which ones are promising candidates for redevelopment work. “Does the neighborhood have an association?” he asks. “Is some improvement taking place? We have a set of indicators we can use to rank neighborhoods, from combat zone to completely OK.” “Sustainable neighborhood revitalization,” according to McNutt, includes market-rate housing, affordable housing, mixed uses, and amenities such as good public spaces. At CNE, he says, “We’ve made the transition from building affordable housing to building mixed-income neighborhoods.” u