Three-Level Cigar Lounge and
For Sale
Contact for pricing
723 CHERRY ST, Chattanooga, TN 37402
Fully improved three-level downtown property built for upscale cigar lounge operations and private events.
Property Size6,500 SF
Price / SF$250
Days on Market65
Property Features for 723 CHERRY ST
General Information
Standard status
Active
Size
6,500 SF
Class
A
Property subtype
Retail, Hospitality, Special Purpose
Zoning
D-CX-12
Investment Type
Owner/User
Additional Details
Business Included
Yes
Building Details
Year Built
1930
Buildings
1
Stories
3
Units
1
Listing Agency:
Coldwell Banker Kinard Realty
(423) 284-3233
Listed By:
Shawn Matthews · License #314204
Source:
Crexi
Added: Jun 9
Changed: Aug 8
Last Checked: Aug 12 at 10:00AM
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 Coldwell Banker Kinard Realty
Investment Insights
Based on property information with market context.
Located at 723 Cherry Street in downtown Chattanooga, this fully improved three-level commercial building totals approximately 6,500 SF and is purpose-built for an upscale cigar lounge and private club environment. The main and second levels include approximately 4,500 SF of premium retail and lounge space with extensive custom infrastructure. Interior features include a glass-enclosed Spanish cedar humidor, custom display cabinetry, approximately 130 humidified cigar lockers, an executive boardroom, luxury lounge seating, integrated audio/visual systems, and a Davidoff-branded double-sided fireplace, along with a heated outdoor patio.
Operational support is engineered specifically for cigar use, including a sophisticated air management system with carbon filtration, radiant heat, radiant heated floors, and a German-designed humidification system. Ownership reports investing more than $250,000 into the HVAC and air circulation systems alone.
An additional third-floor level adds approximately 2,000 SF of event and gathering space currently used for billiards tournaments, private events, and entertainment. This flexible layout supports a range of operating models, including memberships, private functions, corporate events, and hospitality or specialty concepts that can leverage the existing cigar lounge improvements.
Operational support is engineered specifically for cigar use, including a sophisticated air management system with carbon filtration, radiant heat, radiant heated floors, and a German-designed humidification system. Ownership reports investing more than $250,000 into the HVAC and air circulation systems alone.
An additional third-floor level adds approximately 2,000 SF of event and gathering space currently used for billiards tournaments, private events, and entertainment. This flexible layout supports a range of operating models, including memberships, private functions, corporate events, and hospitality or specialty concepts that can leverage the existing cigar lounge improvements.
Key Highlights
- Three‑level commercial property totaling approximately 6,500 SF, built in 1930
- Downtown Chattanooga location with a purpose‑built cigar lounge and private club buildout
- Main and second levels include approximately 4,500 SF of retail and lounge space plus an executive boardroom
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
$60,489
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
3.72%
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%
$1,209,780
$1.2M
Cap Rate 7%
$864,129
$864.1K
Cap Rate 9%
$672,100
$672.1K
Market Conditions
NOI Build-Up for 6,500 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
$85.8K $13.20/SF
− Vacancy
−$5.1K −$0.79/SF
EGI
$80.7K $12.41/SF
− OpEx
−$20.2K −$3.10/SF
NOI
$60.5K $9.31/SF
Area
Chattanooga, TN
Vacancy
6.00%
Lease Rate
$13.20 /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%
$1,209,780
Cap Rate 7%
$864,129
Cap Rate 9%
$672,100
Alternative Uses
Best Use
Specialty Retail
$864.1K
$756.1K – $1.01M
NOI $60,489 @ 7.0% cap · market cap 3.72%
Second Best
Retail
$717.6K
$627.9K – $837.2K
NOI $50,232 @ 7.0% cap · market cap 3.09%
Theoretical Best
Office A
$1.44M
$1.26M – $1.67M
NOI $100,489 @ 7.0% cap · market cap 6.18%
Zoning and permitted uses should be independently verified with authorities.
Property Analytics
Property Profile
Current Use
Lease Details
Turnkey business
Opportunity
Location Intelligence
Trade Area within ½ mile
3,854
Businesses Nearby
182k
Monthly Visits Nearby
Well-served
Demand for This Use
Explore this area
Business Placement
Foot Traffic Nearby
Hotels & Casinos 48%
Dining 32%
Leisure 18%
Shops & Services 3%
Chattanooga Marriott Downtown
Hotels & Casinos
37,127 visits/mo
0.5 miles
AMC CLASSIC Majestic 12
Leisure
17,819 visits/mo
0.3 miles
Holiday Inn & Suites Chattanooga Downtown, an IHG Hotel
Hotels & Casinos
14,703 visits/mo
0.2 miles
Tennessee Aquarium IMAX 3D Theater
Leisure
14,304 visits/mo
0.4 miles
Chili's Grill & Bar
Dining
13,135 visits/mo
0.2 miles
Demographics for 37402, TN
4,464
Population
3,207
Households
1.4
Avg Household Size
38
Median Age
30%
College-Educated
86%
High-School Grad
1.3 sq mi
ZIP Area
3,434
Density / Sq Mi
$28,829
Median Household Income
$42,515
Median Earnings
$673
Median Rent
$460,000
Median Home Value
Market
Vacancy Rate% for Retail in South region
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Frequently Asked Questions
What type of property is this?
Bar & Pub - Fully improved three-level downtown property built for upscale cigar lounge operations and private events.
Where is this bar & pub located?
The property is located at 723 CHERRY ST Chattanooga, TN.
What is the asking price?
The asking price for this property is $1,625,000.
What are key features of this property?
This property features: Three‑level commercial property totaling approximately 6,500 SF, built in 1930; Downtown Chattanooga location with a purpose‑built cigar lounge and private club buildout; Main and second levels include approximately 4,500 SF of retail and lounge space plus an executive boardroom
