Knoxville Council Weighs $750,000 for 25 Affordable Units at Union at Smoky Mountain on Lovell Road

Knoxville City Council meets Tuesday, Oct. 27, at 6 p.m. One item on the agenda is a $750,000 award for affordable apartments on Lovell Road in West Knoxville. Resolution 12.k would let the mayor sign the documents for money from the city’s Affordable Rental Development Fund. The money goes to Impact Housing Indiana Corporation for 25 affordable rental units at 360 Lovell Road, in Council District 2.

Those 25 units are one part of a bigger project called Union at Smoky Mountain. The council packet describes a 100-unit apartment community, and every unit carries an income limit. If the council approves, it adds city money to a deal that already has tax credits, a payment-in-lieu-of-taxes agreement and rental vouchers lined up.

What council is voting on

The agenda lists the item as a resolution to “award an amount not to exceed $750,000.00 from the Affordable Rental Development Fund to Impact Housing Indiana Corporation for the development of 25 affordable rental housing units.”

According to the agenda summary from the Housing and Neighborhood Development Department, the money comes from a $2,500,000 pot the city set aside in this year’s budget for new affordable rental housing. The city does not hand it over as a straight grant. It comes as a thirty-year forgivable loan backed by a deed of trust, and a restrictive covenant keeps the units affordable for the full term.

The project summary puts the award at $30,000 per unit, or 25 units at $30,000 each.

Who the units are for

The summary lists the target population for all 100 apartments:

• 25 units reserved at 30% of area median income (AMI)
• 15 units that may serve up to 60% AMI
• 60 units that may serve up to 70% AMI

The packet also says 25 units will get Project Based Vouchers through KCDC to serve extremely low-income households. The city’s loan agreement sets starting maximum rents for the 25 assisted units at $931 a month for one bedroom, $1,117 for two bedrooms and $1,291 for three bedrooms. Tenant-paid utilities come off those amounts, and different rules apply to units with a project-based subsidy.

The project at a glance

How the deal is financed

Most of the money comes from outside City Hall. The packet lists $14,783,066 in tax credit equity from Merchants Capital Investments, LLC and an initial deferred developer fee of $3,926,522. It also lists a $16,346,368 loan with a 40-year amortization at 6.05% and an 18-year term. The developer is using 4% Low-Income Housing Tax Credit equity, and the packet says the property received tax credits under an income-averaging set-aside of 60% AMI.

The land is leased, not bought. It was appraised at $4,270,000 as of July 28, 2025. The 50-year ground lease includes an option to buy starting in year 30 and calls for an annual payment of $321,425.

The project already has a property tax deal in place. A 20-year Payment In Lieu of Taxes, or PILOT, was approved, holding taxes at $7,590.30 to the city and $5,882.40 to the county. The packet names Annex Construction of Memphis, LLC as the builder.

Timeline: two dates in the packet

The agenda summary says construction is “anticipated to begin August 2026,” and the project narrative says construction “is planned to begin August 2026.” The narrative adds: “Anticipated completion is March 2028 or before.” The information sheet in the packet carries an agenda date of Oct. 13, 2026. The item now sits on the Oct. 27 agenda.

What neighbors said

Impact Housing held a community meeting on Jan. 21, 2026. The packet says flyers went to businesses and landowners along Lovell Road between I-40 and Parkside Drive, plus Simmons Road and Goodys Lane. One attendee from South College, next to the site, raised fencing, homeless encampments and the low-income nature of future residents. The developer’s answer, according to the packet, is a planned retaining wall that will act as a barrier, plus on-site management.

The packet also notes that sidewalks are already in place nearby, that ETHRA Public Transit serves the area, and that a new sidewalk will tie the property to the existing sidewalk on Lovell Road.

Also on the Oct. 27 agenda

• 412 Ocala Drive (12.j): A quitclaim deed to East Tennessee Housing Development Corporation under the Homemakers Program for a contract sales price of $32,000.
• Whitaker water plant (12.n): Up to $42,500,000 in additional grant funding from the Tennessee Department of Environment and Conservation for the Mark B. Whitaker Water Treatment Plant Expansion Project.
• 1231 Luttrell Street (11): An appeal seeking to raise maximum building coverage from 30% to 45% and impervious surface coverage from 40% to 71.5% in an RN-2 district.

For other recent Knoxville housing news, see The Gallery at Beaumont Opens in Western Heights: 52 Mixed-Income Units, a UT Clinic and an Arts Center and KCDC Board Sets Oct. 29 Vote on Loans, Tax Credits and PILOT for 170 Homes at the Former St. Mary’s Hospital.

Dates to know

• Jan. 21, 2026 — Community meeting on Union at Smoky Mountain.
• August 2026 — Construction start listed in the packet.
• Oct. 27, 2026, 6 p.m. — City Council regular meeting, 400 W. Main St., Main Assembly Room.
• March 2028 or before — Anticipated completion, according to the project narrative.

What it means for West Knoxville homeowners

• More rentals are coming to the Lovell Road corridor. 100 new apartments near I-40 add rental supply in the Farragut and Hardin Valley school zones. For comparisons, see Farragut vs. Hardin Valley: Which Knoxville Suburb Is the Better Buy Right Now?.
• Taxes on this parcel are set for 20 years. The PILOT fixes this property’s tax payments. It does not change what nearby owners pay.
• Selling nearby? Buyers will ask about new construction. Pricing against current local sales matters more than headlines.

Thinking about selling in Farragut, Hardin Valley or West Knoxville? Start with a free home valuation, or ask for a cash offer if you would rather skip showings and choose your closing date.

What is Union at Smoky Mountain in Knoxville?

It is a planned 100-unit, all income-restricted apartment community at 360 Lovell Road in West Knoxville, developed by Impact Housing Indiana Corp. in a 4-story garden building on 3.44 acres.

How much is Knoxville giving the Lovell Road project?

Resolution 12.k on the Oct. 27, 2026 agenda would award up to $750,000 from the Affordable Rental Development Fund for 25 units, or $30,000 per unit. It is structured as a thirty-year forgivable loan.

Who can rent at Union at Smoky Mountain?

The packet says 25 units are reserved at 30% of area median income, 15 may serve up to 60% AMI and 60 may serve up to 70% AMI. 25 units will receive Project Based Vouchers through KCDC.

Which schools are zoned for 360 Lovell Road?

The council packet lists Farragut Elementary and Hardin Valley Middle and High as the schools zoned for Union at Smoky Mountain.

When will Union at Smoky Mountain be finished?

The packet says construction was planned to begin August 2026 and that anticipated completion is March 2028 or before.

Source links

• City of Knoxville — City Council regular meeting agenda, Oct. 27, 2026
• City of Knoxville — City Council agenda packet, Oct. 27, 2026 (item 12.k, Union at Smoky Mountain)

More from Kings of Real Estate

Related local news:

• The Gallery at Beaumont Opens in Western Heights: 52 Mixed-Income Units, a UT Clinic and an Arts Center
• KCDC Board Sets Oct. 29 Vote on Loans, Tax Credits and PILOT for 170 Homes at the Former St. Mary’s Hospital
• 113-Unit Altura Apartments Rise Off Ebenezer Road in West Knoxville
• Farragut vs. Hardin Valley: Which Knoxville Suburb Is the Better Buy Right Now?

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