As the Town of Franklin continues to consider options for the old hospital property, the Town Council heard a report on housing and retail space needs.
HCA, the parent company of HCA-Mission and Angel Medical Center, still owns the former hospital property on Riverside Street. HCA is looking to sell the property and has offered it to the town. The sale of the property will come with stipulations set by HCA on how the property can be used.
Town of Franklin leaders have been a part of ongoing discussions about the property as they want to have input on what happens there because of its close proximity to downtown.
Vice Mayor Stacy Guffey said the 14-acre parcel would basically double the size of the downtown area. “One of the reasons that people come to Franklin and one of the reasons that some of us have stayed here is because we love this downtown,” he said. “It’s rare that a town has a chance to look at property of this size in this close proximity to downtown.”
He said the public will be invited to give input as the process moves forward and that they are looking at a variety of options for the property.
“I’m excited about the public-private partnership because there are a lot of places that a lot of us go to and that we love that are only built in the way that we love because they were built as public-private partnerships,” Guffey said. “A lot of the things that people, communities that people love and want to see these days, sometimes that’s the only way they can be built.”
Guffey said the feasibility study shows that there are families struggling to find affordable (non-subsidized) housing. There are working people living in cars and hotel rooms. “These are the kinds of people that are already living and working here who have a tremendous need that I hope we can help.”
In January the council agreed to have UNC School of Government’s Development Finance Initiative (DFI) conduct a feasibility study of the property. Their first report was presented at the Aug. 4 Town Council meeting.
Sara VanLear of DFI said the Phase 1 report was “to understand the current market conditions here in Franklin and how that informs the future development of the hospital site.” They plan to present more details at the October meeting.
VanLear said the property presents “a unique opportunity” due to its proximity to downtown and the topography. “It’s not often that towns come across a site like this, particularly so close to their downtown core.”
Although the old hospital was demolished, she said more site work would be needed to make the property development ready. In studying the market, she said they found there is likely demand for both market rate and affordable rentals, units for purchase, as well as retail space.
She gave an example of the 202-unit Mountain Creek apartment complex in Waynesville that offers primarily market rate apartments with 20 affordable (income-based) units. Rents there range from $1,575 per month to $2,250; the complex was fully leased within nine months, and they now have a 1% vacancy rate.
She said developing the hospital site would need to be done in phases with the residential happening first to support future retail. “If public amenities, like any kind of outdoor recreation opportunities, are also a public interest for this site, amenities could drive traffic to the site facilitating that demand for potential future retail.”
According to the housing data DFI collected, since 2018 the number of housing units in Macon County increased from 11,420 units to 13,810, with much of that coming during the pandemic. Most of the growth was in owner-occupied units as rental properties stayed stagnant at 4,280 during that time period.
VanLear said a “healthy vacancy rate” is about 7% and the county is just under 6% for rentals and even lower for owned properties. However, within the town limits, she said they found a decrease in housing units since 2018 and a near 0% vacancy rate. VanLear said that was not too surprising as there have been few market-rate rentals added to the market in the last 40 years with the largest being 32 units at Oak Forest Apartments in the 1980s. She noted there are 16 duplexes coming on the market in the county and additional duplex units anticipated, but it is not known if those will be for sale, rent or short-term rentals.
She also mentioned how short-term rentals were impacting the housing market for residents. In July 2025, DFI found there were five rental properties available in the town of Franklin. In expanding the search to a 10-mile radius, they found 10 units available. Rents ranged from $2,650 to $3,700. However, there were 400 listings on Airbnb and VRBO.
“There’s just a real shift that we can see if you’re a renter versus a tourist,” she said. “There’s also a real shift if I were a homeowner.”
Home prices can be a challenge for renters looking to buy or people moving here wanting to buy. The age of some of the properties on the market also requires an investment to make improvements.
“We have seen a large increase, nearly 50%, over the last four years in the median home value of properties for sale in the county,” VanLear said. “Since pre-pandemic, that median home price has increased by 82%. So today, if I were looking to buy a home, and if you remember that near-zero homeowner vacancy rate, there’s just a limited, constrained amount of supply and my household would need to make over $100,000 to be able to afford the current median home price.”
VanLear said housing is considered affordable when a household spends no more than 30% of their income on housing related expenses (rent plus utilities or mortgage, insurance and property taxes plus utilities.)
“If you’re spending more than 30%, then you are cost burdened, and if you’re spending more than 50%, your household and your living situation is considered severely cost burdened,” VanLear said.
Income-based rentals are usually for households making 80% or below the area median income. VanLear said the AMI for Macon County is $77,000 a four-person household. A a four-person household with an income of $61,600 would be considered low to moderate income.
“Given the unaffordability of units on the market today, it’s not surprising that there are more than 4,000 low- to moderate income households who are experiencing housing needs,” VanLear said. “So, they’re cost burdened, potentially living in lower quality or overcrowded housing units.”
As housing relates to the old hospital site, VanLear said they are looking at a variety of options to include senior citizens, non-senior singles and families; multi-family units at market-rate and affordable rentals as well as single family homeownership opportunities.
Retail development
In considering retail development, VanLear said they looked at the existing commercial properties within a 15-minute drive of the former hospital site. They found there is approximately a million square feet of retail space with an average rate of $21 per square foot. The least expensive rents were along Main Street at $11 per square foot with near 0% vacancy rate. “We heard from multiple stakeholders that newly available rental space in and near downtown is sold or leased typically in less than a month,” VanLear said.
DFI projected a demand for 45,000 square feet of additional retail space in the area.
VanLear said in meetings with stakeholders it was stressed that the development of the property “be integrated into the fabric of downtown and something that is additional to and supplemental to and not separate from the downtown area” and increasing activity downtown after 5 p.m.
VanLear said they will present the feasibility findings in October.