The Franklin Town Council has pulled back its offer to buy the former Angel Medical Center property on Riverview Street.
On Jan. 6 the council heard the results of the feasibility study the town authorized last January. UNC School of Government’s Development Finance Initiative conducted the study, which cost $61,650.
HCA, which owns Angel Medical Center, still owns the site and finished demolishing the old hospital building in early 2025. The town offered HCA $910,000 for the property in August 2025. The feasibility study showed there would be $500,000-$700,000 in additional site work needed, which would limit the pool of potential developers.
“Not everybody is able and willing to take on that level of work,” said Sara VanLear, who presented the study results from DFI during the Town Council meeting Monday night.
Vice Mayor Mike Lewis said, “For a feasibility study, it’s not sounding very feasible to me.”
“You are correct,” VanLear said. “I think the question of feasibility is the level of investment and what you would recoup potentially on that site when you go to sell to a private developer. I think one of the biggest challenges is because of the combination of the acquisition costs and that additional development cost to get it development ready, you’re looking at premiums that most private developers would not see as achievable currently in Franklin’s market. I think the upfront investment would potentially take a long time to pay off from the town’s perspective.”
VanLear said that as the 13-acre property stands now, about 5 acres, which is primarily the former hospital building site, is most developable. When asked about using the remaining parts of the structures on the property, she said it would require an engineering study to determine what could be built on them and how it could be used.
VanLear said they met with an environmental engineer who specializes in geotechnical analysis. “Based on this review, reuse of the existing structures would likely be challenging, costly, and would introduce redevelopment limitations,” she said.
She said the other parts of the property are potentially developable but would require more studies.
Following the report Monday night, there were questions about HCA not giving the town access to the property for an environmental assessment. “They just refused to sign the access agreement allowing the town to actually access,” Town Manager Amie Owens said. “The DEQ (Department of Environmental Quality) actually had a contractor and some funds available, and DEQ was going to pay for the Phase 1 study, which would have led to potentially the brownfields funding being available. I was sent information from DEQ that we were one of eight sites that was being considered for additional funding, but without that Phase 1, we could not move forward.”
Mayor Stacy Guffey said in a follow-up call about access to the site he was told HCA might not be able to sell the property at the offered price.
“This is extremely disappointing after I don’t know how many hours of staff time and my time and other people on this board negotiating in good faith with HCA,” Guffey said. “A lot of us on this council and some folks who ran for office were excited about the prospect of this project, what it might do for downtown Franklin, the way that it might help address our housing needs in Franklin. So, it’s a disappointment. But, as you’ve heard from our feasibility study, it’s unlikely that it would have been feasible at that purchase price anyway. We probably would have had to go back to the table and negotiate a lower purchase price.”
HCA did not respond to a request for comment by deadline on Tuesday.
Council members Joe Collins and Rita Salain said it is a blessing that the town is learning this information now rather than later.
“In reflection, we shouldn’t have been interested in buying it at that purchase price, so in a lot of ways, it’s a blessing to be where we’re at,” Collins said. “It’s a piece of land that’s going to get developed. HCA will own it. They own it now. They’ll be the ones who have to make the decisions on getting the most money out of it. Private development will happen, but there’s just too many uncertainties right now for the town to be involved directly in this acquisition and development. So I think it’s a blessing to hear what we heard tonight.”
Salain said she too regretted all the time spent on negotiating and trying to find ways to develop the property. “We have done our due diligence plus. I can’t say I’m shocked by the way that this has turned out with HCA, from the beginning, that it was going to be a gift to the town,” she said. “I hope it does get developed privately, so we can look forward to that. But I’m like Joe, I think this is a blessing.”
Vice Mayor Mike Lewis and Town Attorney John Henning pointed out the town will still have some control when it comes to the development of the property as it will likely require zoning and planning approvals.
What the report shows
The feasibility’s market report confirmed what town leaders already know: there is a need for market rate and affordable housing. The number of housing units in Franklin has declined by 8% since 2018, according to DFI’s report. Vacancy rates are near zero.
“We view a healthy vacancy rate at around 7%, which allows for really natural turnover when it comes to both housing and retail space,” VanLear said.
She said there are more than 4,000 low- to moderate-income households that have housing needs in the county. Housing insecurity is defined by spending more than 30% of your household income on housing-related expenses or living in overcrowded or under- or low-quality housing situations. The report showed a need for housing, both for purchase and rent, across the demographics including families, seniors and non-senior single people.
On the retail side, VanLear said the market study shows a “really high-performing downtown on many metrics.”
She said there is likely a demand for more retail space as the vacancy rates for downtown retail space is also near 0%. “Space that does become available apparently gets gobbled up really quickly,” she said. “You have a healthy, busy Main Street with over 7,000 cars on average a day.”
However, she said the current low lease rates around downtown would pose financial hurdles to new retail construction, which would call for higher lease rates. The current average rent rate is $11 per square foot.
VanLear said in doing the site analysis they tested three housing scenarios, which also included 5,000 square feet of retail space. The three scenarios were:
• Market rate mix of 40-45 townhomes and six single family homes for sale. It was estimated the townhome sites would sell for $75,000 and $350,000 after construction. “We have not seen that kind of townhome price point in Franklin,” VanLear said. The single family lots were estimated at $150,000 with a sale price of $550,000 after construction.
• Market rate mix of 18-20 townhomes for sale and 120-125 multi-family apartments for rent. In this scenario it was estimated a multi-family developer would invest about $30 million and the apartments would rent for $1,600-$2,000 per month.
• Mixed income with affordable homeownership and affordable rental opportunities.
On the retail side, VanLear said the lot would sell for approximately $110,000 and a commercial developer would invest about $1.5 million in the property. They would need to get rent of about $8,000 to $10,000 per month, which VanLear said would be about double the current per-square-foot rent in downtown.
In conclusion, Guffey thanked DFI and VanLear for their work. “This is why we do feasibility studies to determine whether expenditure of funds is feasible or not.”
The resolution to withdraw the offer stated that given the results of the feasibility study and without the grant for the cleanup purchasing the property “is not a solid investment of taxpayer funds.”
The council indicated it is not giving up on efforts to address housing needs.