Cookeville continues apartment boom

How much is too much multi-family development? City still hasn’t reached its tipping point, officials say

COOKEVILLE – “If you build it, they will come.” It’s not just one of the most popular movie lines of all time but seemingly the mantra of area contractors who continue to construct multi-family or high-dense housing in Cookeville.

Ask James Mills, director of the city’s planning department, or Jeff Littrell, who heads up the department of codes, and they’ll tell you that they thought Cookeville had reached its capacity for those types of structures years ago. But the demand still stands. In 2013, for example, more than 50 related building permits were filed: for new single-family attached townhomes, duplexes and multi-family additions. The estimated cost of those projects topped $6 million. There’s no indication that will slow in 2014, Littrell said.

Whether that’s good or bad for Cookeville can be debated. But the new construction does support the city’s high rental population. At last census count, 56.5 percent of Cookeville’s housing was classified as rental-occupied. The remaining 43.5 percent are owner-occupied units. While some of the newer townhomes coming online today are available for purchase, it’s still one statistic officials are keeping their eye on.

“It seems weekly we get inquiries for apartment developments, and we get a lot of requests for rezonings to allow apartments,” Mills said. “We’re not anti multi-family, we just have concerns about the percentage gap, which is approaching 20 percent. But talking to the larger owners of these apartments, they’re running full or close to full. So, there’s apparently a demand.”

It’s demand he attributes to Tennessee Tech, among other factors. The university hasn’t built any additional new student housing since 2004. Its current dorms can accommodate 2,250 students, according to residential life. Tech enrolls more than 10,000 undergrads. Cookeville’s overall population has also increased.

But it’s not just Cookeville. Other UC county seats have high percentages of rental-occupied units, too. Jamestown has the highest at 65.8 percent; others sit around the 50/50 mark. The state’s percentage of rental-occupied housing, as a comparison, sits around 31.8, based on 2010 census data, and in the UC only one county seat, Spencer, had a rate less than that.

“There’s more factors than people realize,” Mills said. “There’s the housing market and the ability to get loans. That makes it more difficult to purchase. And just the economy in general. We hope the economy is going to turn around, and all indications are that it will. We hope that will spur more single-family development. We’ve already seen a bit of that.”

Henry Bowman, an analyst with the Upper Cumberland Development District, added that the numbers looked much different once you got outside to the county level. Putnam, for example, had a 35.9 percent rate of rental-occupied units. Fentress stood at 22.1. The Upper Cumberland as a whole has a rate lower than the state at 26.3 percent.

“You can see what’s driving it; it’s Tech students by large measure,” Bowman said. “Certainly in the Cookeville situation, there’s nothing negative about it. They contribute to our local economy, obviously, but they do screw up our statistics pretty bad.”

Census data is one way builders try to gauge demand, which is often a tough proposition, sources said. Housing reports can be helpful, but focus more on metropolitan and national levels.

“It’s all risk,” local builder Aaron Bernhardt said. “If the units we are currently building do not sell or lease, we stop and wait about six months. Then we try again. We are always monitoring and questioning ourselves when we build.”

Overall, Littrell said his office has seen several inquires across the board so far this year, for apartments, single-family, even for larger-scale commercial development. Mills said Cookeville’s biggest surge right now is in townhome construction. That looks to be a trend that will continue.

“I think you’re going to see a lot more, and I think that’s a trend that will continue, especially as land cost goes up,” he said. “That’s a trend nationwide.”