published Sunday, December 16th, 2012

Eastgate adding companies, jobs in Chattanooga

New businesses are growing at Eastgate Town Center on Brainerd Road in Chattanooga.
New businesses are growing at Eastgate Town Center on Brainerd Road in Chattanooga.
Photo by John Rawlston.
  • photo
    Marie White, left, and Isaac Harris wash windows Wednesday at the Eastgate Town Center.
    Photo by John Rawlston.
    enlarge photo

Jeffrey Holst was looking for more space for his growing freight company when he learned about what was available at Eastgate Town Center.

The manager for Let's Go Express, an agent of Chattanooga trucking giant U.S. Xpress, said Eastgate fit the bill for space and location so he plans to shift 18 workers into the former shopping mall in January with hopes of doubling the number in a year or so.

"We're currently operating inside one of U.S. Xpress' terminals," he said. "We've outgrown it."

Let's Go Express is among the new and existing tenants at Eastgate that will soon add more than 100 jobs in Chattanooga.

Paul Mallchok, Eastgate's general manager, said the center is about 75 percent leased as he continues to try to fill up the huge, multi-use site.

"We have no more room for retail," he said.

In addition to Let's Go Express, California-based insurer Answer Financial is opening an Eastgate office in January. The Allstate subsidiary, which sells auto and homeowners insurance, plans to start with 16 employees and grow to about 30 slots in the short-term, said Peter Foley, the company's vice president of operations.

BY THE NUMBERS

1 million - Eastgate Town Center’s total square feet of office and retail space

3,100 - Parking spaces at the center

1,600 - Number of people who work at Eastgate

OVER THE YEARS

1962 - Eastgate opens as city’s first mall

1997 - Site bought by California developer

1998 - Redevelopment plan emerges

1999 - BlueCross BlueShield of Tennessee and Merastar move to center

2002 - Site foreclosed upon

2005 - Eastgate Town Center LLC buys building

2007 - $3 million to $5 million spent to reconfigure space and revamp center

2009 - BlueCross shifts about 1,300 workers from Eastgate to the insurer’s new downtown campus

2012 - New companies, Let’s Go Express and Answer Financial, announce plans to start operations in Eastgate in January 2013

Source: Eastgate Town Center, newspaper archives

"Depending on our need and available employees, we'd consider going further than that," he said.

Also, longtime Eastgate tenant Convergys is to add at least 60 jobs to the 900 already at its call center, said company spokeswoman Brooke Beiting. She cited client demand for the increase.

"If our clients are ramping up something and need more employees, that's what we try to do," she said.

City's First Mall

Eastgate was Chattanooga's first mall when it opened in 1962 off Brainerd Road. It was one of the city's key retail hubs for decades. But it fell on hard times after the opening of Hamilton Place mall in 1987.

A plan emerged about a decade later to make Eastgate a place where people worked, shopped and were entertained. In 2007, a California ownership group spent an estimated $3 million to $5 million to reconfigure space and revamp the center.

Today, it holds a collective of businesses, retailers, education entities, state and city agencies, a club and, soon, a theater ensemble, said Mallchok.

Earlier this month, Mallchok strolled through the center, pointing out tenants both old and new. But then he came to one wing of the former shopping mall's south end that's pretty much unleased, half-jokingly asking an observer if he had any ideas about how to program that space.

He said he's continuing to refill space after the departure of two key tenants. About two years ago, BlueCross BlueShield of Tennessee vacated 221,000 square feet, more than a quarter of the office space at Eastgate. It shifted workers to the insurer's new downtown corporate campus on Cameron Hill.

More recently, Access America Transport, too, moved from Eastgate to offices downtown at Warehouse Row.

Mallchok said Eastgate's central location and access to Interstates 75 and 24 are important.

Parking & Security

"It's got 3,100 parking spaces," he added. "It's got 24-hour security. It's a CARTA transfer station."

Mallchok said he'd like to see a direct link between Eastgate and nearby Chattanooga Airport on CARTA.

"There's no way to get here to the airport," he said. "I'd like to see a CARTA shuttle. We're missing that little link."

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    People wait to board the Megabus Wednesday at the Eastgate Town Center.
    Photo by John Rawlston.
    enlarge photo

The general manager said that in recent months, Eastgate has become a drop-off and pick-up point for Megabus, the point-to-point coach company that runs bus service to nearby cities for inexpensive fares.

People who ride Megabus can get to downtown Chattanooga easily using CARTA buses, Mallchok said.

Foley of Answer Financial said one reason it choose Eastgate was because of a move earlier this year by a longtime tenant, Unitrin Direct, formerly Merastar Insurance Co., to cut about 30 local jobs.

"It has moved some functions out of state and stranded some employees who are highly qualified," he said. "We wanted to take advantage of that."

Holst said his business moves auto parts for the Detroit's Big 3 automakers and other car companies and their suppliers. He said he wanted move to Tennessee because of a more favorable tax structure.

The most important factors about Eastgate, however, were available and affordable space, he said.

about Mike Pare...

Mike Pare, the deputy Business editor at the Chattanooga Times Free Press, has worked at the paper for 27 years. In addition to editing, Mike also writes Business stories and covers Volkswagen, economic development and manufacturing in Chattanooga and the surrounding area. In the past he also has covered higher education. Mike, a native of Fort Lauderdale, Fla., received a bachelor’s degree in communications from Florida Atlantic University. he worked at the Rome News-Tribune before ...

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