Plans and Timeline for Redevelopment of the AJ Building Come into Focus

Rendering of the AJ Building
Rendering of the AJ Building

After several years of fits and starts and false-starts, it appears the Andrew Johnson Building — now to be known as the AJ — will finally be brought into a use more fitting for the current downtown era. BNA Associates, which won the right to redevelop the property in 2017. Complications ensued on the county’s end with finding negotiating for a suitable location for the Knox County School offices. BNA associates and principals, Philip Welker and Ethan Orley also developed the Oliver Hotel.

That completed, with a move slated to the TVA towers, the opportunity returned for development of the building. But in the ensuing three years, the situation had changed. The proposal for a hotel on the site would likely be unable to find financing with the combination of the increase in downtown hotel rooms in last three years and, more particularly, the near collapse of the hospitality industry worldwide as a result of the pandemic.

Given that the delay was not the fault of BNA, the Knox County Commission agreed to give approval for the project to proceed in a modified form. The original proposal called for the building to be sold to BNA for $6,000,000 and that price will be honored. The plan called for development of 94 hotel rooms, 30 micro apartments and 45 standard apartments. The new plan converts all rooms to apartments, with the original 169 to “somewhere between 135 and 146 units,” according to Philip Welker, co-founder of the company.

First Floor Plan of the AJ Building

McCarty Holsaple and McCarty will serve as architects, as called for in the original plan, while Denark Construction will complete the site work.  The next hurdle for the project is the decision regarding a pilot, which is due February 28. Assuming that and other financing pieces come into alignment, Welker projects closing on the project in September.

While the county is still interested in having an hotel on the site and has expressed interest in converting it, that conversion will have to be determined in the future. Due to financing restrictions, Welker says, that conversion will not likely happen for at least five years. He said he feels the current plan retains flexibility and allows the company to do the primary work now in order to bring the building back to life. Having it sit for several more years, as he pointed out, would not be good for the building.

Each unit will have a small kitchen area and will be quite small, running “about 400 to 650 square feet.” This will allow for lower rent than would otherwise be the case and leaves the apartments in a square foot range of a large hotel room, suite or studio. If or when the conversion is made to hotel rooms, the total number of rooms will be larger than the original plan, which called for 94 rooms.

Andrew Johnson Building, 912 South Gay Street, Knoxville, July 2017

The change in plans impacts the third through fifteenth floors only. Welker says that all other plans for the building remain in place. This includes a 4,000 square foot roof-top bar, a restored ballroom and a fitness center open to both residents and the public. Also included will be conference spaces, a 3,650 square foot bistro with a patio, a 1700 square foot coffee shop in association with Stumptown Coffee Roasters, and a 2,000 square foot dining space with associated commercial kitchens.

Mr. Welker said that while material prices are up from three years ago, he’s hopeful the labor market will cool off a bit, saving the project some money on that end. Assuming all goes well through the purchase in September, the project should be completed March and September of 2023. In the interim, planning and design work will continue on the assumption that the coming months will be more predictable than the previous several years.