Lee Highway Redevelopment
For Sale
Contact for pricing
5950 LEE HWY, Chattanooga, TN 37421
Commercial building with additional vacant lot on Lee Highway.
Property Size5,130 SF
Lot Size0.50 Acres
Price / SF$233.92
Days on Market113
Property Features for 5950 LEE HWY
General Information
Standard status
Active
Size
5,130 SF
Class
B
Total Parking Spaces
20
Lot size
0.50 Acres
Property subtype
Retail, Office, Self Storage
Zoning
C2
Building Details
Year Built
1973
Year Renovated
2023
Buildings
1
Units
1
Listing Agency:
RE/MAX Real Estate Center
(423) 664-6644
Listed By:
Cliff Butler · License #303081
Source:
Crexi
Added: May 11
Changed: Aug 17
Last Checked: Aug 30 at 4:29PM
Displayed information is deemed reliable but is not guaranteed and should be independently verified. All listing content including descriptions, pricing, images are the copyrighted material of RE/MAX Real Estate Center
Investment Insights
Based on property information with market context.
Located along the highly traveled Lee Highway corridor, this offering includes a commercial property at 5950 Lee Hwy and an adjoining vacant lot at 5942 Lee Hwy. The additional approximately 0.50 acre parcel directly behind the site creates an outstanding commercial opportunity with additional expansion potential. The extra land gives investors, developers, and owner-users added flexibility. Strategically positioned with excellent visibility and quick access to I-75, Hamilton Place, East Brainerd, Downtown Chattanooga, and North Georgia, the property benefits from strong daily traffic counts and consistent commercial activity surrounding the area. The commercial property is ideal for retail, office, automotive, showroom, contractor yard, medical, or mixed commercial use. The inclusion of the vacant lot significantly increases the property’s functionality and future upside. Investors can capitalize on the additional land for expansion of existing improvements, additional income-producing structures, outdoor storage or contractor use, increased parking capacity, future redevelopment opportunities, multi-tenant commercial concepts, or billboard income. The property is positioned in a rapidly growing section of Chattanooga, offering close proximity to the Hamilton Place retail district, Chattanooga Airport, East Brainerd, Downtown Chattanooga, Ringgold & Fort Oglethorpe, Georgia, and major national retailers and restaurants. The existing commercial property has a size of 5130 square feet.
Key Highlights
- Includes an additional 0.50± acre vacant lot for expansion, development, or parking.
- Located on highly traveled Lee Highway with excellent visibility and strong traffic exposure.
- Offers convenient access to I‑75, Hamilton Place, East Brainerd, Downtown Chattanooga, and North Georgia.
Financial Insights
Estimated NOI and Cap Rate
NOI = area × lease_rate × (100 − vacancy) / 100 × (1 − expense_ratio). Net Operating Income — what the owner takes home each year before mortgage payments and income tax. Effective rent (asking rent minus vacancy losses) minus operating costs (taxes, insurance, maintenance, management).
NOI / Yr
$58,867
Cap rate = NOI / list price × 100. Capitalization rate — annual return on a fully cash purchase, before financing. NOI divided by price. Higher means more income per dollar invested, but usually also more risk or older condition. 5–8% is typical for stabilized commercial property; double digits often signal distressed deals.
Cap Rate
4.91%
Suggested Prices Based on Cap Rates
Cap rates vary significantly by property type, market, and asset quality.
Typical U.S. stable-market ranges:
Multifamily — 4.5% to 6.5% (Class A in primary markets often sub-5%; Class C in secondary markets 6%+)
Industrial / Logistics — 5.0% to 7.0% (compressed heavily in recent years due to e-commerce demand)
Office — 6.5% to 9%+ (wide spread post-2020; CBD Class A vs. suburban Class B varies dramatically)
Retail — 5.5% to 8.5% (grocery-anchored on the low end, unanchored strip centers higher)
Hospitality / Hotels — 7.5% to 10%+ (higher due to operational risk)
Self-Storage — 5.5% to 7.5%
Medical Office — 6.0% to 7.5%
Net Lease (single tenant, credit) — 5.0% to 7.0% depending on tenant credit and lease term
Rules of thumb:
Primary markets (NYC, SF, LA, Boston, DC) trade at lower cap rates than secondary/tertiary markets, often by 100–200 bps (bps, aka basis points; 1 bp = 0.01%).
Class A assets trade ~50–150 bps tighter than Class B, and Class B tighter than Class C.
Cap rates move inversely with price — a lower cap rate means a higher price for the same NOI.
Spread to the 10-year Treasury is a common benchmark; historically 200–400 bps over the 10-year.
Cap Rate 5%
$1,177,340
$1.2M
Cap Rate 7%
$840,957
$841.0K
Cap Rate 9%
$654,078
$654.1K
Market Conditions
NOI Build-Up for 5,130 SF
Vacancy — income lost from leasable area expected to sit empty during the year, subtracted from gross rent.
EGI (Effective Gross Income) — gross rent minus vacancy losses, the realistic income before paying operating costs.
OpEx (Operating Expenses) — recurring costs to operate the property (property tax, insurance, utilities, maintenance, management); excludes financing and capital improvements.
NOI (Net Operating Income) — income a property generates after operating costs but before financing and taxes.
Gross rent
$92.3K $18.00/SF
− Vacancy
−$13.9K −$2.70/SF
EGI
$78.5K $15.30/SF
− OpEx
−$19.6K −$3.82/SF
NOI
$58.9K $11.48/SF
Area
Chattanooga, TN
Vacancy
15.00%
Lease Rate
$18.00 /SF/Yr
Expense Ratio
25.00%
Simulate Cap Rate and NOI
Suggested Prices Based on Cap Rates
Cap rates vary significantly by property type, market, and asset quality.
Typical U.S. stable-market ranges:
Multifamily — 4.5% to 6.5% (Class A in primary markets often sub-5%; Class C in secondary markets 6%+)
Industrial / Logistics — 5.0% to 7.0% (compressed heavily in recent years due to e-commerce demand)
Office — 6.5% to 9%+ (wide spread post-2020; CBD Class A vs. suburban Class B varies dramatically)
Retail — 5.5% to 8.5% (grocery-anchored on the low end, unanchored strip centers higher)
Hospitality / Hotels — 7.5% to 10%+ (higher due to operational risk)
Self-Storage — 5.5% to 7.5%
Medical Office — 6.0% to 7.5%
Net Lease (single tenant, credit) — 5.0% to 7.0% depending on tenant credit and lease term
Rules of thumb:
Primary markets (NYC, SF, LA, Boston, DC) trade at lower cap rates than secondary/tertiary markets, often by 100–200 bps (bps, aka basis points; 1 bp = 0.01%).
Class A assets trade ~50–150 bps tighter than Class B, and Class B tighter than Class C.
Cap rates move inversely with price — a lower cap rate means a higher price for the same NOI.
Spread to the 10-year Treasury is a common benchmark; historically 200–400 bps over the 10-year.
Cap Rate 5%
$1,177,340
Cap Rate 7%
$840,957
Cap Rate 9%
$654,078
Alternative Uses
Best Use
Office B
$841.0K
$735.8K – $981.1K
NOI $58,867 @ 7.0% cap · market cap 4.91%
Second Best
Retail
$566.4K
$495.6K – $660.8K
NOI $39,645 @ 7.0% cap · market cap 3.30%
Theoretical Best
Office A
$1.13M
$991.4K – $1.32M
NOI $79,309 @ 7.0% cap · market cap 6.61%
Zoning and permitted uses should be independently verified with authorities.
Property Analytics
Property Profile
Current Use
Location Intelligence
Trade Area within ½ mile
868
Businesses Nearby
Explore this area
Business Placement
Demographics for 37421, TN
51,686
Population
23,978
Households
2.2
Avg Household Size
40
Median Age
38%
College-Educated
92%
High-School Grad
31.7 sq mi
ZIP Area
1,630
Density / Sq Mi
$79,958
Median Household Income
$44,452
Median Earnings
$1,313
Median Rent
$299,600
Median Home Value
Market
Vacancy Rate% for Office in South region
Questions? Ask Rey
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Frequently Asked Questions
What type of property is this?
Retail property - Commercial building with additional vacant lot on Lee Highway.
Where is this retail property located?
The property is located at 5950 LEE HWY Chattanooga, TN.
What is the asking price?
The asking price for this property is $1,200,000.
What are key features of this property?
This property features: Includes an additional 0.50± acre vacant lot for expansion, development, or parking.; Located on highly traveled Lee Highway with excellent visibility and strong traffic exposure.; Offers convenient access to I‑75, Hamilton Place, East Brainerd, Downtown Chattanooga, and North Georgia.
