KNOXVILLE, TN (WOKI /WVLT) – A long-awaited redevelopment of the former St. Mary’s Hospital property is officially underway.
DGA Residential and the Knoxville Community Development Corporation (KCDC) broke ground Wednesday on Riella at Oakwood, a 170-unit affordable housing community planned for the historic hospital site at 1880 Huron Street in North Knoxville.
The development will transform the vacant property into a mix of senior housing, family apartments and townhomes while preserving portions of the nearly century-old hospital building.
“This is a beautiful building, it’s here in Knoxville, and we want to make an impact,” said DGA Residential President Craig Cobb.
What the Development Includes
The project will feature three housing components:
- 40 senior apartments inside the historic St. Mary’s Hospital building
- 109 apartments for families in a newly constructed building
- 21 townhomes along East Churchwell Avenue
Developers said the renovated hospital will include community amenities such as a fitness center, computer center and gathering spaces. Original architectural features, including marble floors, are expected to be preserved where possible.
The family apartment building will offer one-, two- and three-bedroom units, while the townhomes will feature three- and four-bedroom layouts designed to blend with nearby single-family neighborhoods.
When completed, the development will include:
- 45 one-bedroom units
- 50 two-bedroom units
- 64 three-bedroom units
- 11 four-bedroom units
Residents will have access to fitness centers, business centers, community rooms, playgrounds, a pavilion and a dog park.
Affordable Housing for Working Families
Project leaders said the community is aimed at serving Knoxville’s workforce, including teachers, first responders, healthcare workers and hospitality employees.
Cobb said a family of four earning up to approximately $83,000 annually could qualify for housing. A single resident earning up to roughly $53,000 could qualify for some units.
KCDC CEO Ben Bentley said rents will be based on income levels.
Under preliminary estimates:
- Some seniors living on Social Security could pay between $400 and $500 per month for a one-bedroom apartment.
- Households on the upper end of the income range could pay roughly $1,200 per month for a two-bedroom unit.
Officials stressed that final rental rates have not yet been set.
The development will remain affordable for at least 30 years under requirements tied to its financing structure.
Addressing Knoxville’s Housing Demand
City leaders say the project comes at a critical time as Knoxville continues to experience rapid population growth.
Mayor Indya Kincannon said Knoxville has added approximately 20,000 residents over the past decade and roughly 10,000 new housing units within the last seven years.
“If we don’t keep up with the demand, then the cost gets beyond most people’s reach,” Kincannon said.
Bentley noted that approximately 10,000 people are typically on waiting lists for KCDC’s Housing Choice Voucher and public housing programs.
“We need more housing of all types at all price points,” Bentley said.
Funding and Construction Timeline
The project carries a construction cost of more than $43 million and an overall development cost exceeding $70 million.
Funding comes from multiple partners, including:
- Tennessee Housing Development Agency
- U.S. Department of Housing and Urban Development
- City of Knoxville
- Pinnacle Financial Partners
- Walker & Dunlop
The city is investing $2 million through its Affordable Rental Development Fund to support units for extremely low-income households.
Construction will occur in phases, with the redevelopment expected to be fully completed by fall 2028.
Developers anticipate the renovated hospital building and townhomes could be available within 12 to 14 months, while the larger apartment building will be completed later in the process.
Riella at Oakwood (WVLT)
Officials expect housing applications to open in about a year.
