KNOXVILLE, Tennessee — After more than 18 months of talks, Knox County and TVA are poised to seal a deal that would give the school system a new home and put a major building on Gay Street up for development.
First, however, elected officials will have to bless it.
The agreement calls for the county to buy the Summer Place office building and parking garage at Summer Place and Walnut Street from TVA and enter a long-term lease/easement agreement to occupy TVA's nearby East Tower at the head of Market Square.
Knox County would take up about six floors of the tower, totaling more than 100,000 square feet, and would have the chance to sublet another six floors to someone else, 10News has learned.
Members of Knox County Commission and Knox County Board of Education are set to hear the pitch Wednesday afternoon at the City County Building. More specific details about the deal are expected to be released then including Summer Place's anticipated purchase price.
Those involved in talks say the TVA is open to leasing out space in the tower at a rate significantly lower than the going rate of about $15 per square foot. Moving into the tower and buying Summer Place from the utility giant would be much cheaper than building a new building.
Some retrofitting would be necessary in Summer Place.
County officials declined comment until Wednesday's presentation.
Some County Commission and school board members already have looked at the space.
TVA has been interested in consolidating offices into the West Tower for at least a couple years. While talks with the county may have appeared slow, progress actually has moved at about the expected pace, said TVA spokesman Jim Hopson on Tuesday.
"We are just pleased that we are still moving forward," Hopson said.
TVA's data center is located below the plaza in the East Tower. As a result, that space is not open for occupancy. TVA would keep it.
The county, however, could take over 12 floors from the plaza level on up in the East Tower, which is slightly smaller than the West Tower.
Summer Place has about 700 parking spots as well as some office and storage space. There's been high interest among others besides the county in acquiring Summer Place.
Talks started while Knox County Mayor Tim Burchett was in office. They've continued since Glenn Jacobs became mayor in September 2018.
Jacobs also has talked with Superintendent Bob Thomas about the move.
Hopson said the locale is prime for whomever ends up in the tower. Downtown Knoxville is enjoying a renaissance, especially North Gay Street and Market Square.
He's previously indicated there's long been interest locally and outside Knoxville in its downtown properties.
The school system needs to find a home for its administrative offices to make way for sale of the A.J. Building. That, too, was a priority before Burchett left office.
If the school headquarters, built in the late 1920s as a hotel, ends up in private hands it'll once again generate tax revenue. Authorities estimate a boutique hotel on the south end of Gay Street would have a multimillion-dollar economic impact.
It would also further cement development on South Gay, which now conceptually extends to Sevier Avenue and the new Regal headquarters.
BNA Associates of Nashville has been waiting more than a year with its $6 million offer for the A.J. Building.