Lovett Industrial has entered the Nashville market with the purchase of 10.4 acres in Hendersonville, Tenn. This swath of land will be the development site of Innovation Way Logistics Center, a 107,500-square-foot industrial property.

Powers Brown Architecture is the lead architect, while Kimley-Horn serves as the project’s civil engineer. Groundbreaking is scheduled for July 2025 and delivery is expected in June 2026.

Carrying the address 230 Innovation Way, the site is along New Shackle Island Road, offering direct access to Interstate 65 and U.S. Route 31E. Nashville International Airport is some 21 miles south.

Upon delivery, Innovation Way Logistics Center will be a rear-load building with a clear height of 32 feet and 215 feet in depth, having 29 dock-high doors and two drive-in doors. The property will also feature a 130-foot truck court and 120 parking spaces. Stream Realty Partners’ Griffin Farriss, Bradley Worthington and Andrew Fletcher will handle marketing and leasing.

READ ALSO: Manufacturing Surge Drives Industrial Expansion

The Nashville industrial real estate market had a decent 2024, according to fourth-quarter report from Colliers. The sales volume exceeded $1.4 billion, marking a 37 percent year-over-year increase.

Meanwhile, industrial space absorption totaled nearly 4.3 million square feet, and 4.0 million square feet were delivered, though that caused a slight bump in overall vacancy, to 4.1 percent. Almost 4 million square feet of industrial space were under construction as of the end of December, according to Colliers.

Lovett’s recent activity across the U.S.

Lovett has been active across a wide swath of the country in recent months:

•  In July, the company obtained entitlements for the development of a 298,000-square-foot facility in Chino, Calif., in the Inland Empire West submarket. Construction was scheduled to start in the fourth quarter of 2024.

•  The following month, Lovett delivered Broadway Logistics Center, a 201,329-square-foot Class A industrial building in Denver. Cushman & Wakefield was assigned to lease the spec project.

•  In October, Lovett broke ground on Highway 1 Commerce Center, a Class A spec last-mile logistics project in Philadelphia. The warehouse is slated for delivery by the third quarter of this year.

•  And in December, the developer broke ground on a 339,280-square-foot Class A logistics park in the Dallas-Fort Worth area. This project’s completion is also expected in the third quarter.

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The location is at the intersection of interstates 65 and 840. The town is about 25 miles south of Nashville.

Simon will develop the mixed-use center in collaboration with Nashville-based Adventurous Journeys Capital Partners. That company works in the hospitality, mixed-use and residential sectors; its brands include Graduate Hotels, Marine & Lawn Hotels & Resorts and Field & Stream Lodge Co.

Preliminary project plans call for about 75 retailers, as well as restaurants and a hotel. Residential options and big-box retailers could be added at a later time.

A Simon spokesperson told Commercial Property Executive that the project is in such an early stage that a site plan and renderings are not yet available.

READ ALSO: Retail Development Is Bouncing Back, but the Game Has Changed

Simon already has some noteworthy retail assets in the Nashville area. These include the super-regional  Opry Mills, the metro’s largest shopping destination, featuring more than 200 stores and 20 restaurants. Another is The Mall at Green Hills, which Simon owns through a joint venture with Taubman Realty Group.

Last September, Simon Property Group LP amended, restated and extended its $3.5 billion credit facility. The move was intended to give Simon more financial flexibility as it expands experiential options at many of its malls.

Good neighborhood

Demand for retail space in Nashville rose steadily in 2024, according to a fourth-quarter report from Matthews Real Estate Investment Services. Available space was tight, however, despite the 1.3 million square feet delivered throughout the year. About 760,000 square feet was under construction as of December, a pipeline still below the metro area’s average for the past 10 years.

Based on Nashville’s strong population growth, Matthews predicted that retail vacancy will likely remain below 3.5 percent through the next five years, below the national average.

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Located on 89 acres at 315 S. Rutherford Blvd., the first phase of MTIC will consist of a rear-load, 234,588-square-foot building and a front-load 149,150-square-foot building. Both will feature 36-foot clear heights. Building 1 will also have up to 56 dock doors and 188 parking spaces, while Building 4 will include up to 40 dock doors and 177 parking spaces.

A timetable for construction of the final two assets is not available but Building 2 is expected to be a 216,405-square-foot rear-load building and Building 3 is planned as a 103,777-square-foot rear-load building.

The buildings can be used by single or multiple tenants. The developers anticipate receiving inquiries from a wide variety of potential tenants, from local warehousing users to larger, more regional distribution users. Major companies in the area include Lineage Logistics, FedEx, Americold Logistics and Amazon.

Close to Nashville and highway

MTIC will be situated within Nashville’s primary core Interstate 24 submarket and about 36 miles southeast of downtown Nashville. The property is strategically positioned to serve both downtown Nashville and the broader regional area due to its proximity to I-24.

Ryan Dodge, a partner and managing director at New York-based real estate finance and management firm PCCP, said in prepared remarks the I-24 corridor has been experiencing high user demand and limited supply due to high barriers to entry. Noting the Greater Nashville area is projected to continue seeing an in-migration of population and wealth, Dodge said they expect the industrial sector in the region to remain robust.

READ ALSO: Automation and AI Shape Future Industrial Demand

The Nashville industrial market had 224 million square feet of inventory and a 3.7 percent vacancy rate at the end of the third quarter, according to the developers. JLL reported in its third-quarter 2024 market report the Nashville market had 4.7 million square feet of speculative development under construction, with tenant demand at nearly 6 million square feet. That should lead to rising rents. With positive macroeconomic conditions in the Southeast region, JLL expects Nashville to continue to be viewed as a highly desirable market for tenants and investors.

William Sisk, Brett Wallach and John Zeffrey of Lee & Associates in Nashville are handling leasing for the property owners.

Earlier Nashville JV

PCCP and DRG have worked together in Tennessee in the past. In October 2022, they announced the formation of a joint venture to build Beechcroft Industrial Park, a speculative three-building, 815,530-square-foot project in Spring Hill, Tenn., near a major General Motors manufacturing plant. Beechcroft Industrial Park includes a 228,580-square-foot rear-loading building, a 244,950-square-foot rear-loading building and a 342,000-square-foot cross-docked building. The 63-acre site is 38 miles south of downtown Nashville.

More PCCP industrial projects

In November, PCCP formed a joint venture with CRG to develop The Cubes at Alpha, a 575,900-square-foot industrial park on a 37-acre site in Alpha, N.J. Delivery is expected by the third quarter of 2025. The project will be aimed at e-commerce, distribution, 3PL and manufacturing uses. The Cubes at Alpha will have two buildings measuring 270,900 square feet and 305,000 square feet. Located near Interstate 78, the property is about 24 miles southwest of Allentown, Pa., and about 60 miles east of The Port Authority of New York & New Jersey.

In June, PCCP teamed with another joint venture partner, BBX Logistics Properties, for The Park at Delray, a 40-acre industrial campus in Delray Beach, Fla. Phase one of the project includes the development of a 200,000-square-foot building. Upon completion, it will feature three buildings totaling more than 670,000 square feet.

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Some notable office deals closed in the metro in the first eight months of the year, the high sale prices pushing Nashville above some significant southern markets. Additionally, despite the growing vacancy rates trend across gateway and high-volume secondary markets, Nashville’s has shown signs of improvement so far in 2024.

As office inventories struggle with rising vacancy, owners are looking to offload assets, residential conversion being an emerging trend across the U.S. While Nashville is not among the nation’s top markets for office adaptive reuse, there are some opportunities. The Conversion Feasibility Index, a new tool developed by CommercialEdge, shows which markets have strong office-to-residential repurposing fundamentals, based on property-level scores and building classifications.

Significant projects added to Nashville’s pipeline

As of August, Nashville’s office market had 2.1 million square feet of space underway across nine properties, accounting for 3.6 percent of existing stock. The rate was way above the national figure of 1.0 percent as well as those recorded in most similar markets, such as Phoenix (0.4 percent), Houston (0.7 percent), Atlanta, (0.9 percent), Charlotte (1.5 percent) and San Diego (3.1 percent). Only Austin outperformed Nashville, with 4.1 percent.

In terms of space underway, Nashville outperformed Philadelphia (2 million square feet), Atlanta (1.9 million square feet), Houston (1.7 million square feet) and Charlotte (1.1 million square feet.

The market’s largest office development is the Pinnacle Tower at Nashville Yards, a 650,000-square-foot project that will rise 34 stories at 500 Platform Way in downtown Nashville. The project, developed by Southwest Value Partners, broke ground in 2021 and is expected to come online in 2025.

In February, Equitable Property Co. purchased a 44-acre site for the development of a mixed-use project that will include two medical office buildings totaling 400,000 square feet, up to 250,000 square feet of retail space, a 240-key hotel and 75 townhomes. Phase I of the project dubbed Sewart’s Landing is taking shape in in Smyrna, Tenn., with delivery expected in the first quarter of 2025.

Year-to-date through August, developers broke ground on 352,000 square feet of office space, while only 202,000 square feet were delivered across two properties.

Completed properties included Educational Media Foundation’s new headquarters, a 170,000-square-foot, five-story office building at 2000 Reams Fleming Road in Franklin, Tenn., that came online in April, and The Office Lofts at Finery, a 49,000-square-foot, six-story development at 1 Merritt Ave., that opened in February. The latter is part of The Finery mixed-use project, developed by Hines Interests.

Growing office investments

A total of 951,316 square feet across nine office properties traded for $195 million in Nashville through the first eight months of the year. The amount marked a 31 percent year-over-year growth, putting Nashville ahead of similar metros such as Atlanta (29 percent) and Phoenix (26.7 percent), but behind Charlotte (32.9 percent).

In terms of sales volume, the market outperformed Orlando ($126 million) and Charlotte ($149 million). Dallas led with $812 million, followed by Austin ($644 million).

Notable office deals in Nashville included the $84.5 million acquisition of Truist Plaza, a 338,000-square-foot building at 401 Commerce St. Menlo Equities purchased the 13-story property from Eakin Partners in April.

Another significant transaction was Boyle Investment Co.’s $48.8 million purchase of The McEwen Building, a 175,262-square-foot, seven-story office asset in Franklin, Tenn. KBS sold the 2014-built property and the deal was part of the buyer’s expansion strategy in the Cool Springs submarket.

Nashville office assets traded at an average sale price of $205 per square foot, above the national average of $173 per square foot. Properties were pricier on average than those in Houston ($103 per square foot), Dallas ($125 per square foot), Charlotte ($133 per square foot) and Atlanta ($146 per square foot). Austin remained significantly more expensive, with prices at $376 per square foot.

Nashville’s office vacancy rates are dropping

Nashville’s office vacancy has been on a downward trajectory since the start of the year—from the 17.0 percent recorded in January to the 16.0 percent registered in July. As of August, the metro’s rate clocked in at 15.6 percent, down 60 basis points year-over-year.

The figure was below the national average of 19.4 percent. Meanwhile, similar metros such as Orlando (16.8 percent), Charlotte (18.6 percent), Atlanta (21.3 percent) and Dallas (22.9 percent) recorded higher values.

One of the most impactful announcements that stirred the Nashville office market involved software company Oracle. The Austin-based firm plans to move its world headquarters to the city, having already secured a 65-acre site in the East Bank section in 2021. While waiting for the completion of its $1.2 billion campus, Oracle will be leasing office space.

The coworking sector holds steady

Nashville’s coworking sector featured 1.8 million square feet of flexible office space in August, outpacing Charlotte (1.3 million square feet) and Orlando (1.1 million square feet). However, the volume was small when compared to Houston’s 4.3 million square feet.

The coworking space as percentage of all leasable office space reached 3.2 percent, one of the highest rates among similar markets and way above the national average of 1.8 percent. The metro outperformed Austin (1.6 percent), Charlotte (1.7 percent) and Denver (2.2 percent), but lagged Miami (3.7 percent).

The largest coworking operator in the metro was Spaces, with 218,000 square feet, followed by E|spaces (217,212 square feet) and Regus (202,940 square feet). Serendipity Labs (90,662 square feet) and Expansive (80,111 square feet) occupied the fourth and fifth position, respectively.

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EQT Exeter Real Estate Income Trust Inc. has acquired two industrial properties—one near Harrisburg, Pa., and one in the Nashville, Tenn., area—for a total of more than $245 million. Both assets came online last year and are fully leased under commitments of 10 years or more.

The 1.2 million-plus-square-foot property at 3327 E. Harrisburg Pike in Middletown, Pa., in central Pennsylvania, is within 5 miles of both Harrisburg International Airport and the Norfolk Southern Railway’s Rutherford Intermodal Yard. It sold for more than $170 million and the previous owner appears to have been Core5 Industrial Partners, CommercialEdge information shows.

READ ALSO: Top 5 Emerging Industrial Markets in 2024

The other asset, a 638,000-square-foot warehouse at 1500 Shoals Way in Portland, Tenn., changed hands for $75 million. The seller was Al. Neyer and the tenant is Shoals Technologies Group, according to a first-quarter industrial real estate market report from Lee & Associates. Shoals is a manufacturer of electrical balance of systems components.

EQRT acquired the two properties with proceeds from the sale of 91.2 million Class E units of its operating partnership to EQT Exeter Holdings US, Inc., an affiliate of its sponsor. The deals also involved debt financings, including a $85.3 million loan from New York Life Insurance Co., public records reveal.

Launched last August, the REIT is externally advised by EQT Exeter, the real estate division of EQT AB. EQRT seeks to invest about 80 percent in commercial assets, including industrial of life science properties, and 20 percent in multifamily or self storage assets.

The REIT’s first acquisition, that closed in March, involved a 449,642-square-foot industrial asset at 110 SE Inner Loop in Georgetown, Texas. The seller was Portman Holdings.

Off the radar

Pennsylvania’s I-81/78 corridor is facing a collision between weak tenant demand and new speculative space arriving on the market, according to a July report from Savills. As a result, vacancy in the corridor has risen for seven straight quarters, to 5.6 percent in the Central Pennsylvania submarket.

Fortunately, the quantity of space under construction is down from one year ago and currently totals 4.5 million square feet in the region. Savills forecasts that owners of properties over 1 million square feet will start to divide such spaces into smaller blocks if they can’t find sole tenants.

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The venture will focus on individual industrial assets that are “mission-critical facilities” to their tenants and leased on a long-term basis, Brennan Chairman & Managing Principal Michael Brennan told Commercial Property Executive.

More specifically, there will be an emphasis on acquiring manufacturing facilities, which is one of Brennan Investment Group’s longstanding investment specialties. The 10th joint venture’s first acquisition, made for an unspecified price, is a 386,700-square-foot manufacturing property in Corbin, Ky., in metro Knoxville, Tenn. The asset is 100 percent leased to a subsidiary of Trèves Group, a global supplier focused on automotive interiors and auto interior acoustics.

“A mission-critical facility is where there’s a substantial investment in equipment and what we call ‘bolt-down’ costs, which makes the likelihood of default very low, and creates a high propensity to renew your lease,” Brennan said. “Obviously, as real estate investors, we love that they stay in the building, and there’s less interruption in income. Generally speaking, that’s better for the investment.”

At one time, manufacturers tended to own their own buildings, but these days companies are more comfortable with long-term leases for manufacturing in the U.S., Brennen told CPE. The leases can be quite long: 25 years sometimes, with an option to lease for another 25 years.

READ ALSO: Industrial Property Values on the Upswing

“It’s a wonderful opportunity in a sector that even today remains out of favor,” Brennen says of the partners’ focus on manufacturing. “That’s slowly changing because we’re seeing this influx—a tremendous influx—of manufacturers. Even so, it’s still out of favor, so we can get good prices. But the fundamentals are very, very good.”

A long-term partnership

The partners are building on their nine previous joint ventures, which have acquired over 100 properties totaling nearly 25 million square feet in the single-tenant, net lease sector over the past 12 years. Though with an emphasis on manufacturing, the 10th joint venture will pursue deals for all industrial facility types, also including R&D and distribution, with tenants who are committed to at least a 15-year lease term, and who have made significant investment in the properties.

Macro-economic trends are now working in favor of manufacturing facilities as a real estate investment, according to Brennan, including e-commerce, automation, nearshoring and supply chain repositioning.

Brennan Investment Group is betting on U.S. and near-U.S. manufacturing assets by developing them as well as through acquisition. In March, the company broke ground on a 393,800-square-foot cross-dock building at Pinnacle Business Park in Laredo, Texas, which is slated for a December completion.

Mushrooming manufacturing

Pandemic-related supply chain disruptions and gnawing trade (and other) tensions between China and the U.S. have cast a pall on sprawling global supply chains, according to a report released in February by NAIOP and Newmark. At the same time, the federal government has rolled out sizable new incentives for various industries, especially important tech, to locate new manufacturing facilities in the U.S., and is investing in infrastructure that will support an expansion of the nation’s manufacturing capacity.

READ ALSO: How Reshoring Is Driving Industrial Real Estate Demand

Since 2020, there have been over 300 major manufacturing facility announcements in North America, representing about $400 billion in pledged project investment and a minimum of 250 million square feet of new development over the next decade, according to the report, citing Newmark Research data.

The automotive, energy and biomanufacturing sectors are making the largest investments in new manufacturing in the U.S., the report notes, adding that over the next decade, the footprint of U.S. manufacturing space is forecast to expand by 6 percent to 13 percent. Most of the new manufacturing space will be build-to-suit or owner-built, but there will be some demand for spec manufacturing space.

Reshoring is only part of the equation. Manufacturers are also nearshoring their operations, with Mexico being the prime beneficiary of the trend, as well as U.S. industrial markets along the border.

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Manulife Investment Management has launched a joint venture with Foundry Commercial to purchase, develop and lease industrial outdoor storage in across infill industrial markets in the Southeast.

The joint venture plans to operate a portfolio consisting of 10 sites, located in Nashville, Tenn., Atlanta, Jacksonville, Fla., and Dallas Fort-Worth. Manulife has already acquired three of the sites that have completed construction, while the remaining will be developed together with Foundry.

Manulife has $19.2 billion worth of assets under management and more than 84.6 million square feet of commercial real estate on a global scale, while Foundry currently has $2.7 billion in assets under management.

The decision to invest in this niche got a boost from the reduction in capital costs compared to industrial properties in general, which also brings opportunities unavailable to the general marketplace, said Foundry Commercial Principal Rick Coe in a prepared statement.

A sought-after industrial niche

Despite being a small, rather untapped industrial niche, IOS is attracting a significant number of investors looking to branch out and diversify.

In early January, Alterra IOS partnered with ConGlobal Industries to acquire four IOS properties totaling nearly 90 acres. The assets are located in areas with dense IOS clusters, near port and rail infrastructure.

More recently, Triten Real Estate and TPG Angelo Gordon announced plans to acquire more than $1 billion in additional industrial outdoor storage assets over the next five years. The joint venture initially launched their investment platform in 2020 and have since purchased more than $500 million of IOS assets across 16 markets.

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JLL Capital Markets led the financing efforts for Cummins Station on behalf of the owner, Nashville-based DZL. Despite the difficult macro-economic climate and headwinds facing the office sector, a pool of liquidity for office assets in good locations with strong tenancy still exists, according to JLL, who did not specify the lenders in the deal.

Cummins Station is the adaptive reuse of a historic warehouse, and is a mix of retail, restaurants and office space. Current retail tenants include Morning Glory Deli, Pullman Standard and Wild Wasabi, with Starbucks and fitness studio Lagree Nash recently joining the roster. Office tenants include Clark Construction, Gibson Brands, ad agency GS&F, Eventbrite, Civic Financial Service and Serendipity Labs, a coworking space.

READ ALSO: Charting Luxury Retail’s Course in the New Economy

The four-story concrete and masonry Cummins Station was built in 1906 as a wholesale warehouse building servicing railroad lines that ran through the area near Union Station and was the largest reinforced concrete warehouse in the world at the time of its development.

Until its initial redevelopment in the 1990s, it was used continuously as a warehouse space, and retains many of its original design elements. It is on the National Register of Historic Places.

In October, Nashville-based DZL hired Avison Young to provide advisory services regarding the entire Station District, which includes Cummins Station, but also the 61,000-square-foot office and retail Baggage Building, the 58,000-square-foot Cannery Hall event space, and more than 12.4 acres of developable land.

DZL, which assembled the portfolio over the last 20 years, is reportedly open to a sale, joint venture, or other opportunities for the Station District.

Nashville retail hot, office not so much

Downtown and Midtown Nashville experienced 58 percent of all office leasing activity across the market in the first quarter of 2024, mostly at mixed-use projects and on Music Row, which indicates that flight-to-quality includes in-building and neighborhood amenities, according to JLL. Overall, however, there was negative net absorption of 371,000 square feet of office space in Nashville in the first quarter of 2024 as demand lags.

On the retail side, by contrast, Nashville has been a boomtown in recent years, Matthews Real Estate Investment Services reported in late 2023, supported by economic and population growth with few parallels elsewhere in the nation. The metro area’s population surged by nearly 25 percent from 2011 to 2021 and currently sees nearly 100 new residents per day move there each day, according to Census Bureau data.

Net retail absorption has bested 200,000 square feet in seven of the most recent eight quarters as of the end of last year, Matthews reported, putting overall vacancy at a tight 3.3 percent, nearly a 15-year low.

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Investment volume increased considerably when put against last year’s first three months but prices per square foot fell slightly.

From the vacancy standpoint, Nashville fared better than most of its peers and was below the national figure, with occupancy increasing year-over-year.

The coworking sector also showed a healthy performance, with the metro having one of the largest shares of flexible office space in the U.S.

One of the largest office pipelines

As of the end of March, Nashville’s office market had a construction pipeline of more than 3 million square feet across 11 properties, accounting for 4.5 percent of stock. It considerably surpassed the 1.5 percent national construction rate and outpaced many secondary markets such as Austin (3.9 percent), Charlotte (2.8 percent) and Atlanta (1.7 percent).

The largest project under construction in Nashville was Pinnacle Tower, a 650,000-square-foot building within the 19-acre Nashville Yards project. Upon completion, the $1 billion mixed-use campus is slated to include more than 3 million square feet of office space, along with sizable residential, hospitality and retail components. Recently, the Creative Artists Agency signed a lease for 75,000 square feet at another building within the campus.

In 2024’s first quarter, just a 300,000-square-foot property broke ground. In terms of deliveries, also only one building came online, comprising 32,000 square feet of office space within The Finery mixed-use project developed by Hines. Regarding sheer volume brought to market, Nashville lagged most of its peers including Phoenix (107,865 square feet), Atlanta (180,240 square feet) and Austin (635,250 square feet).

Additionally, a joint venture of Equitable Property Co. and Chapman Capital is eyeing a mixed-use development slated to include two medical office buildings totaling 400,000 square feet, along with a large retail and hospitality component. The partners recently acquired the 44-acre site in Smyrna, Tenn., and plan to break ground in 2025’s first quarter.

Nashville office investments on the rise

As of the end of March, a total of 306,492 square feet changed hands in the Nashville office market across three sales for a transaction volume of roughly $63 million. These figures represent a significant increase in activity compared to the 67,513 square feet that traded for $15.3 million in 2023’s first quarter.

The price per square foot clocked in at $200.9, an 11 percent decrease from the $225.9 registered in the metro in the same period last year. Nashville was pricier than many of its peers such as Atlanta ($110.6), Dallas ($141.3) and Phoenix ($187.3), but was considerably behind Austin’s whopping $506.6.

The largest transaction registered in the first quarter involved the 175,000-square-foot McEwen Building in the Cool Springs submarket. Boyle Investment Co. paid $48.8 million, acquiring the asset from KBS. At the time of the sale, the building was 95 percent leased to 15 office and retail tenants.

Vacancy ticks down in Nashville’s office market

The vacancy rate in Nashville’s office market clocked in at 15.5 percent at the end of the first quarter, representing a 190-basis-point decrease year-over-year. Vacancy was below the 18.2 percent national figure and the metro fared better than most of its peers such as Phoenix (18 percent), Dallas (21.7 percent), Austin (22 percent) and Denver (22.7 percent).

One of the largest moves to Nashville’s office market was Austin-based software company Oracle’s headquarters relocation. The company acquired a 65-acre site in the metro back in 2021, with plans to develop a $1.2 billion office campus and move 8,500 employees. In the interim, the company will be leasing office space.

Large coworking slice in Nashville

As of the end of March, there were 1.8 million square feet of coworking space in Nashville’s office market across 83 properties, accounting for 2.9 percent of total stock. The share of flexible space was far above the 1.8 percent national average, as the metro surpassed many of the other secondary markets such as Atlanta (2.1 percent), Denver (2.2 percent) and Raleigh-Durham (2.6 percent).

One of the largest flexible office space operators was Regus, with about 188,250 square feet across 10 properties. WeWork was second, with a 151,000-square-foot footprint across three locations, followed by Spaces, with 128,000 square feet in four properties.

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KKR has paid $76.2 million for a two-building industrial campus in Nashville, Tenn., public records show. The firm financed the purchase with a $42 million loan from Forethought, due to mature in 2034.

The seller was a joint venture between LRC Properties and Machine Investment Group, according to CommercialEdge information.

The Class A logistics property, 2 Dell Parkway, is adjacent to the Nashville International Airport. The partnership acquired the initial 289,000-square-foot building in 2021 and expanded the property by developing a 119,700-square-foot facility that came online last year.

READ ALSO: Top 5 Emerging Industrial Markets in 2024

The two-building asset features cross-dock and rear-loading capabilities alongside 30- and 32-foot clear heights. The 32-acre campus also includes a truck court, ESFR sprinklers and 36- by 36-foot column spacing. Amazon has been a tenant at the property since 2019, having leased nearly 100,000 square feet at Building 1 for a same-day shipping fulfillment center.

The location provides access to the larger Tennessee area via the nearby interstates 24, 40 and 65. Downtown Nashville is approximately 10 miles away.

Nashville’s industrial scene

The Nashville industrial market continues to remain in demand. According to the most recent CommercialEdge industrial report, Nashville ranked third among the Southern metros, trailing Miami and Atlanta, in terms of rent growth as of March, at 7.5 percent. The metro also led the South for vacancy rates, which averaged 3.3 percent.

As for sale prices, Nashville occupied once again the first position, with properties trading at an average of $164 per square foot, followed by Dallas-Fort Worth at $145 per square foot and Tampa at $136. However, the investment volume was one of the smallest in the U.S. year-to-date as of March, totaling some $58.6 million, according to CommercialEdge information.

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The Austin, Texas-based company was already in the city, having bought a 65-acre site in the city’s East Bank section in 2021, with plans to develop an office campus for as many as 8,500 employees over the next decade, and leasing office space in the interim. The Metro Council also approved a proposed $1.2 billion investment plan for the site, according to The Tennessean newspaper.

The Oracle property is adjacent to River North, a 105-acre mixed-use development planned by MRP Realty and Creek Lane Capital. Oracle is working with city officials to provide infrastructure upgrades in East Bank, including a deal to invest in a pedestrian bridge across the river, the newspaper reported.

READ ALSO: What’s Ahead for CBDs

Warren Smith, principal & managing director of Avison Young’s Nashville office, said the software company’s land acquisition in 2021 provided an impetus for increased development in the area, which is already seeing a new $2.1 billion football stadium being built for the Tennessee Titans. It is being built adjacent to the current Nissan Stadium, which will be demolished when the new stadium is completed by 2027.

“That whole part of Nashville is being energized,” Smith told Commercial Property Executive.

The Oracle news from Ellison came just days after the Metro Council unanimously approved a master development agreement between Metro Nashville Government and The Fallon Co. to develop a 30-acre mixed-use project on Metro-owned land on the East Bank. The agreement is part of Nashville’s Imagine East Bank Vision Plan, which was developed by the Nashville Planning Department over a two-year period of community engagement.

READ ALSO: Top 5 Markets for Industrial Transactions

The site will have more than 2 million square feet of office, retail, hotel and residential space. More than 40 percent of the 1,550 residential units will be set aside for affordable housing, including some deeply affordable apartments, to help grow the new mixed-income neighborhood. It will also include wide sidewalks for pedestrians, bike paths and dedicated transit lanes. Preliminary studies estimate infrastructure costs for the public-private project will be about $147 million.

Michael Fallon, CEO of the Boston-based development firm, noted that the Oracle site is just north of the Metro-owned East Bank property. He said the Oracle project is just beginning the zoning process so he was not sure which components will be built first, but said that the company’s headquarters decision “certainly reinvigorates the potential office demand.” He added that it validates the East Bank and Nashville and may provide tailwinds for other development.

Health-care hub and corporate relocations

Ellison made his remarks during a fireside chat at the Oracle Health Summit in Nashville with Bill Frist, a former U.S. Senate majority leader. He said he wanted to move the company’s world headquarters to Nashville to be closer to the center of the health-care industry as Oracle expands its presence in the sector. Oracle bought Cerner, a Kansas City, Mo.,-based company that provides software for managing electronic health records in 2022 for $28 billion. Health-care companies in the Nashville area include HCA Healthcare, Community Health Systems, HealthStream, Change Healthcare, Acadia Healthcare and Vanderbilt University Medical Center.

“HCA is the largest for-profit hospital chain in the world and they’ve diversified in a lot of businesses, so it’s just an amazing health-care atmosphere on the business side,” Smith told CPE.

Ellison also touched on Nashville’s quality of life. During the livestream he called Nashville a “fabulous place to live” and “great place to raise a family” with a unique and vibrant culture. He said when they surveyed employees, Nashville ticked all the boxes.

Fallon said that does help draw such companies as Oracle, Amazon and AllianceBernstein, the global investment firm, which announced in May 2018 it was relocating from New York City to Nashville. In May 2022, AB unveiled its new corporate headquarters at 501 Commerce in the mixed-use Fifth + Broadway development, where it occupies more than 221,000 square feet of office space. The firm is expected to employ more than 1,250 people by this year.

While The Fallon Co. had been in the Nashville market prior to 2019, Fallon said AB’s surprise move to Nashville solidified their plans to focus on the city as a key market.

“They cited a lot of the same things a lot of other companies probably cite about the business climate, and it certainly does have an advantageous tax environment,” Fallon said.

Both Nashville and Tennessee are regarded as offering a business-friendly climate that has no state taxes. While he wasn’t familiar with the incentives being provided to Oracle, Smith said the city, state and economic development agencies are very pro-active with companies seeking to relocate or develop.

While Amazon didn’t choose Nashville as its second headquarters during a yearlong search between 2017 and 2018, the e-commerce company announced in late 2018 it would open offices at Nashville Yards in two office towers and create about 5,000 jobs.

Oracle left Silicon Valley in 2020 to open its U.S. headquarters in Austin, Texas. In May 2021, Oracle sold Sobrato Office Tower, a 378,961-square-foot Class A office building in San Jose, Calif., to PIMCO and Lane Partners for $155 million.

The post Behind Oracle’s HQ Move to Nashville appeared first on Commercial Property Executive.

In its first Tennessee acquisition, Greenberg Gibbons has purchased Cool Springs Pointe, a 198,103-square-foot retail center in Brentwood, Tenn., for $34.5 million. CommercialEdge data reveals the previous owner was SITE Centers.

The buyer acquired the retail asset through Greenberg Gibbons Real Estate Income Fund, a $100 million private equity fund launched in 2021. The investment vehicle targets shopping centers across the Midwest, Southeast and East Coast markets.

Greenberg Gibbons used this fund to also purchase Gateway Plaza, a 214,789-square-foot retail center in Sanford, Fla., for $23.6 million. Another acquisition was that of Town N’ Country, a 263,490-square-foot property in Greenville, S.C., for $23 million.

READ ALSO: Reimagining Retail

Anchored by Best Buy, Ross Dress for Less, Golf Galaxy and Old Navy, among other retailers, Cool Springs Pointe was fully leased at the time of sale. The asset previously traded in 2000 for $22.5 million, according to CommercialEdge information.

The 1998-completed retail center attracts more than 1.8 million visitors annually. The shopping center occupies more than 19 acres at 1600 Galleria Blvd., off Interstate 65; U.S. Route 31 is 2 miles west, while downtown Nashville, Tenn., is some 15 miles north.

A closer look at Nashville’s retail fundamentals

In the last quarter of 2023, Nashville’s retail market had one of the tightest vacancy rates in the nation, at 3.2 percent, according to a report by Avison Young.

However, the metro’s retail investment volume took a dip last year, falling from the $350 million figure recorded in 2022—translating to $364 per square foot—to nearly $100 million or $274 per square foot in 2023, the same report shows. Even so, the price per square foot remained above the five-year average of $241.

Meanwhile, 1.1 million square feet of retail space came online in Nashville in 2023. One of the delivered properties was a a 290,000-square-foot, open-air shopping center owned by Tanger Outlets.

The post Greenberg Gibbons Enters Tennessee With Nashville Buy appeared first on Commercial Property Executive.

Boyle Investment Co. is expanding its presence in Nashville’s Cool Springs submarket with the acquisition of The McEwen Building, a 175,000-square-foot Class A office building from KBS for $48.8 million.

KBS Real Estate Investment Trust III purchased the mixed-use building at 1550 W. McEwen Drive in Franklin, Tenn., in May 2012 for $40 million, according to CommercialEdge data. KBS, one of the nation’s largest commercial real estate investors, was founded in 1992. Along with its affiliated companies, the firm has completed more than $44.9 billion of transactions on behalf of private and institutional investors globally.

Since the pandemic, KBS had signed 112,000 square feet of new and renewal leases at the Cool Springs property. The asset had a 95 percent occupancy rate at the time of the sale, with 15 businesses and retail and restaurant tenants.

READ ALSO: What Workers Want Now in Office Design

Marc DeLuca, KBS CEO and eastern regional president, said in a prepared statement KBS identified an opportunity to capitalize on a high-performing property to achieve additional liquidity in the current debt environment. He said the REIT’s ability to bring the building to nearly 100 percent occupancy, particularly in the challenging office leasing and investment climate, is a testament to solid asset management expertise, the strength of the core office assets and the strength of the Nashville market. DeLuca added the building traded at a 5 percent discount from its 2022 valuation.

Like many owners of U.S. office properties, the California-based REIT has been struggling to meet its debt obligations as office property values drop. KBS REIT III stated in a December filing with the U.S. Securities and Exchange Commission that it was facing $1.7 billion in loan maturities in 2024 and its debt load on the 16 properties it owned at the time could affect its solvency.

The REIT had previously received a two-year extension on a loan that included The McEwen Building and three other properties, according to Bisnow. CommercialEdge reports the REIT had a $9.3 million bridge loan for The McEwen Building that was originated in January 2020 by U.S. Bank and matured in March 2023. More recently, the REIT was granted a fourth extension on a $613 million loan covering a six-property office portfolio of more than 3 million square feet after agreeing to raise $100 million by July 15, Bisnow reported. Those properties are located in the Dallas-Fort Worth metro, the Bay Area and Minneapolis.

The McEwen building up close

The seven-story building in Franklin has 577 parking spaces and 28,000 square feet of retail space on the ground floor, including Brixx Wood Fired Pizza + Craft Bar, Title Boxing Club and Massage Luxe. Kaiser Aluminum has its world headquarters on the top floor of the office building. Built in 2009, the LEED-registered and Energy Star-Gold rated building recently underwent more than $2.1 million in capital improvements.

Situated on 11 acres in the McEwen Southside development, The McEwen Building provides tenants with direct access to more than 30 restaurants, 70 retailers, eight hotels and seven fitness studios. Many of those offerings are within a 3-minute walk of the property. Completed in 2014, McEwen Southside has a mix of upscale residential units, Whole Foods and several retail and dining options, including PureBarre, Lululemon and BrickTops, all centered around The McEwen Building.

The property is also situated directly across West McEwen Drive from the Boyle-managed McEwen Northside, a 45-acre mixed-use development that has positioned itself as one of the area’s top destinations. During the first two months of 2023, Boyle completed a mixed-use building in the master-planned McEwen Northside community that had 126,000 square feet of office and 15,000 square feet of retail and restaurant space.

Boyle Nashville owns and manages almost 4 million square feet of office and retail space, as well as a projected 5 million square feet in the development and planning stages. In addition to McEwen Northside, other projects include Berry Farms, Meridian Cool Springs, CityPark Brentwood and Capitol View.

Jeff Haynes, a Boyle Nashville partner, said in a prepared statement the purchase of The McEwen Building helps the firm further its vision of creating a unique district in Cool Springs that began with McEwen Northside. He said the firm’s goal has always been to stitch together great pieces in a highly walkable area and create an atmosphere that benefits tenants and the community.

Transaction team

Samir Idris, David Meline and Crews Johnston of Cushman & Wakefield represented KBS in the sales transaction.

Greenberg Traurig represented KBS as legal counsel in the disposition. Bruce Fischer, co-chair of West Coast Real Estate and co-managing shareholder of the Orange County, Calif., office for Greenberg Traurig, led the team. He was assisted by Howard Chu, attorney and shareholder with the firm, and Amanda Kennedy, a paralegal.

The post KBS Sells Nashville-Area Office Building appeared first on Commercial Property Executive.

In a partnership with Chapman Capital, Equitable purchased the land from the Town of Smyrna.

The development’s master plan calls for two medical office buildings totaling up to 400,000 square feet, up to 250,000 square feet of street-level retail, a 240-key hotel and 75 for-sale townhomes. Leasing efforts will be led by JLL Senior Associate Kipper Worthington and Land Deleot, Equitable’s founder.

READ ALSO: Is Retail 2024’s Sleeper Hit?

Phase I of Sewart’s Landing will break ground this March and is set to deliver in the first quarter of 2025. JLL has already secured retail tenants for the project’s first phase, including Starbucks, Wawa, Jonathan’s Grille, a national grocer and others.

In a prepared statement, Worthington said that only one outparcel is not yet spoken for, and that JLL is in negotiations with 10 further tenants for the remaining 50,000 square feet of single- and multi-tenant retail in Phase I.

The development will be sited at the corner of Sam Ridley Parkway and Highway 41 and will feature a pedestrian-focused street grid, community green space and a walking trail surrounding the property.

The development team includes Fulmer Lucas and Lowen + Associates, both of Nashville, as the civil engineers and architects, respectively. Land planning and entitlement were led by Kiser + Vogrin Design, of Franklin, Tenn.

Sewart’s Landing is also supported by a $26 million-plus TIF from Rutherford County.

Smyrna is within 25 miles of Nashville and enjoys an average household income of about $94,000. In addition, 2,600 residential units reportedly are under construction adjacent to the site on Genie Lane and will feature direct access to Sewart’s Landing via a crosswalk.

Music City heat

The Nashville retail real estate market is booming, buoyed by exceptional economic and population growth, according to a November report from Matthews Real Estate Investment Services. “Over the last 12 months, retail rental rates have surged, registering one of the fastest growth rates in the nation, with an impressive annual increase of 6.5 percent.”

Net absorption has exceeded 200,000 square feet in seven of the most recent eight quarters, leading to an overall vacancy of just 3.3 percent, nearly a 15-year low, Matthews reports.

Consistent with that environment, last October saw Big V Property Group secure a $125 million refinancing for The Avenue Murfreesboro, in the Nashville MSA. The lifestyle center totals almost 850,000 square feet and is anchored by H&M, Belk, Barnes & Noble, Haverty’s Furniture, Old Navy, Dick’s Sporting Goods, Best Buy and Burlington. It’s 93.1 percent leased.

Later that same month, Tanger Outlets opened a 290,000-square-foot open-air shopping center in southeast Nashville. Tanger Outlets Nashville features seven buildings and 60 stores, including Ugg, Coach, Pottery Barn, J. Crew, Gap, Levi’s and Bath & Body Works.

The post Equitable Property Eyes Big Nashville Mixed-Use appeared first on Commercial Property Executive.

CBRE brokered the sale of The Baker Donelson Center. Image courtesy of CommercialEdge

PNH Properties has acquired 211 Commerce, an office building spanning 233,314 square feet in Nashville, Tenn., for $75 million. The seller was a joint venture between Velocis and Lincoln Property Co. CBRE brokered the deal on behalf of the buyer.

The asset previously traded in 2021 in a $50.3 million deal that involved a $51.9 million acquisition loan from Prime Finance Partners, according to CommercialEdge data.

Built in 2000, the property also known as The Baker Donelson Center rises 11 stories featuring 21,461-square-foot floorplates and ground-floor retail space. The previous ownership recently implemented $16 million in capital upgrades to the building, adding a new conference center and business center, along with renovating the lobby, tenant lounge, elevators and facade. Tenants include FirstBank, Nashville Health Care Council and IRiS Networks, the same source shows.

Located at 211 Commerce St., the building is within downtown Nashville, across the street from the AT&T Building. The property is also within walking distance of the Riverfront transit stop and of the Tennessee State Capitol.

CBRE Senior Vice Presidents J. Roscoe High and Morgan Hillenmeyer represented PNH Properties in the off-market transaction.

Nashville outperforms national average

Year-to-date as of October, Nashville registered a total investment volume of $161 million, at a price of $248 per square foot—well above the national average of $196, a recent CommercialEdge report shows. The metro ranked third across southern markets in terms of average sales price, lagging Austin ($413 per square foot) and Miami ($365 per square foot).

The metro’s office market has been performing well, with vacancy rates dropping 2.6 percent year-over-year and reaching 16.1 percent in October. Nashville’s vacancy was below the national figure of 17.8 percent, according to the same source.

The post Velocis, Lincoln Property Sell Nashville Office Asset for $75M appeared first on Commercial Property Executive.

A rendering of CAA’s future Nashville home. Image courtesy of CAA

The Creative Artists Agency, one of the world’s largest talent management firms, will relocate its Nashville, Tenn., office to the 19-acre Nashville Yards, the largest project in the city’s history.

CAA will move from its current office at the SunTrust Building to 75,000 square feet across two floors at 955 Church, an under-construction, 420,000-square-foot Class A+ tower. Upon relocation, scheduled near the end of 2025, the firm will become the building’s anchor tenant and earn exterior signage rights.

CAA has had a presence in Music City since 1991. The firm’s Nashville base of operations currently hosts 130 employees.

A creative office building

Developed jointly by Southwest Value Partners and AEG Worldwide, CAA’s future home rises 11 stories at 955 Church St. CannonDesign envisioned the firm’s offices to feature both indoor and outdoor workspaces, together with gaming and lounge areas.

When complete, the creative office building will have floorplates of more than 40,000 square feet, three levels of retail space, floor-to-ceiling windows and private outdoor terraces as well as a landscaped outdoor deck. Colliers Principals & Executive Vice Presidents Janet Sterchi and Shane Douglas, alongside Vice President Ashley Harrison, oversee all leasing at the property.

The development has no shortage of entertainment offerings in its immediate vicinity: Many of the city’s famous music venues lie half a mile eastward along Broadway, while Music Row lies within a mile to the south. The newly renovated Union Station Nashville Yards is also nearby.

Dealings at the Nashville megaproject

Nashville Yards’ origins go back to 2017, when the partners formed a joint venture for the development of the $1 billion project following AEG’s $44 million purchase of the site at 910 Commerce St. At full build-out, the mixed-use campus will include more than 3 million square feet of office space, over 2,000 multifamily units, two hotels, 350,000 square feet of additional retail and entertainment space, as well as a 4,500-seat event hall.

READ ALSO: Enhancing Work Environments Through Creative Offices

The campus’ other office offerings remain active in various stages of development. Amazon is currently building its Nashville headquarters, a two-tower, 1.2 million-square-foot office park whose 566,000-square-foot first building finished construction in 2021. However, this February the e-commerce behemoth paused on the construction of the second building, as it revaluated its uses of the space amid the apparent permanence of hybrid work.

As for office leases, one of the largest was the 180,000-square-foot deal signed by Bass, Berry & Sims PLC in 2021. The law firm preleased the top eight floors of the tower at 200 10th Ave. N.

Another office tenant at Nashville Yards is Pinnacle Financial, which leased 95,000 square feet at 201 Platform South, a 35-story, 675,000-square-foot Class A+ office tower. Following the commitment, the firm became the complex’s sole banking tenant.

Overall, the nation’s music capital retains strong office fundamentals, despite some short-term slowdowns in new development. According to data from a recent CommercialEdge report, the city had the second largest development pipeline in the South as of September, with more than 3 million square feet of space under construction.

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Tanger Outlets Nashville celebrates its grand opening today. Image by Allen Clark of Allen Clark Photography, courtesy of Tanger Outlets

Tanger Outlets has opened a 290,000-square-foot, open-air shopping center in southeast Nashville, Tenn. The asset, Tanger Outlets Nashville, features 60 stores across seven buildings.

“With Nashville’s population growing rapidly, we see an excellent opportunity to bring our unique open-air shopping experience to this vibrant area,” Andrew Wingrove, executive vice president & chief commercial officer at Tanger, told Commercial Property Executive. “Our goal is to not only offer access to national brands but also support local businesses, charities and job development to positively impact the community.”

Tenants include lifestyle companies, athletic and athleisure clothing, home goods, cosmetics, footwear and a variety of fashion brands. Dining options in the center include fast casual and upscale restaurants. Additionally, there are several local Nashville brands and dining tenants occupying space at the retail center.

Crumbl Cookies, UGG, Ulta, Coach, Michael Kors, Nike, Adidas, Ariat, Victoria’s Secret, Pottery Barns, J. Crew, Gap, Levi’s, Old Navy, Crocs, Bath & Body Works, Prince’s Hot Chicken and TailGate Brewery are among some of the tenants in the center. Upon opening, the asset was 96.5 percent leased.

Supporting the local community

The outlet center includes an outdoor playground. Image by Craig Kohring of Tanger, courtesy of Tanger Outlets

Tanger Outlets Nashville was constructed around The Green, an outdoor community space for events and programs. The shopping center includes 15 murals painted by local and national artists.

“We’re thrilled Tanger can now call Nashville home and be a gathering place for tourists and residents alike,” Wingrove said.

Located at 4060 Cane Ridge Parkway, the shopping center spans across 32 acres, CommercialEdge data shows. Situated off Interstate 24, the property is in an area where the daily traffic count reaches 167,410 cars. Downtown Nashville is approximately 14 miles northwest of the retail facility.

Tanger Outlets Nashville is the company’s 37th shopping center and reportedly the first outlet center to open in the nation since 2019. The open-air facility is the third Tanger Outlets center in the Tennessee area, alongside locations in Memphis and Sevierville.

The post Tanger Opens 290 KSF Nashville Shopping Center appeared first on Commercial Property Executive.

Completed in 2007, The Avenue Murfreesboro encompasses 11 buildings on an 85.6-acre site. Image courtesy of JLL Capital Markets

Big V Property Group has secured $125 million in cash-out refinancing for The Avenue Murfreesboro, a 846,467-square-foot lifestyle retail center in Murfreesboro, Tenn. JLL Capital Markets arranged the five-year, balance sheet financing.

Big V purchased the asset in 2020 from Hines for $136.4 million, according to CommercialEdge data. Beal Bank provided a $90 million acquisition loan, the same source shows.

Completed in 2007, the retail center encompasses 11 buildings on an 85.6-acre site. After the purchase, Big V created a capital improvement plan, which resulted in a significant value rise within the three years of ownership. The property also benefits from the area’s affluent population, with an average household income of $96,620 within a 3-mile radius.

Anchored by H&M, Belk, Barnes & Noble, Haverty’s Furniture, Old Navy, Dick’s Sporting Goods, Best Buy and Burlington, the open-air retail center was 93.1 percent leased at the time of the sale. The tenant roster at The Avenue Murfreesboro also includes a mix of lifestyle and power center tenants such as Barnes & Noble, Off-Broadway Shoe Warehouse, Victoria’s Secret, Michaels, Petco, Forever 21, Cost Plus World Market, Old Navy, Ulta, Hollister, Buckle, American Eagle and Sephora.

Senior Managing Directors Chris Drew and Brian Dawson and Managing Director Matt Casey led the JLL Retail Capital Markets Debt Advisory team that secured the financing.

Vice President Bryan Kallenberg and Senior Analyst Dean Lumish led the Big V Property Group Capital Markets team. At the end of last year, the company purchased a 938,103-square-foot shopping center in Austin, Texas. JLL Capital Markets brokered the transaction and arranged the $90 million acquisition financing. Allianz Life Insurance Co. provided the five-year senior loan.

Nashville’s economic growth

The Avenue Murfreesboro is located at 2615 Medical Center Parkway, placing it roughly 30 miles south of downtown Nashville. Located in an affluent and growing trade area within the Nashville MSA, the shopping center records nearly 6.5 million visits per year.

The accelerated growth in Nashville’s economy and population has significantly boosted the retail market within the area over the last few years. According to a recent Matthews report, retailers are drawn to Nashville’s above-average household and income growth. Moreover, the metro’s population has seen a solid increase of 66 percent from 2010 to 2022.

The post Big V Secures $125M Refi for Nashville-Area Shopping Center appeared first on Commercial Property Executive.

The two-building industrial park came online this year. Image courtesy of JLL Capital Markets

Pearlmark Real Estate Partners has acquired Alligood Industrial Park, a 410,370-square-foot, two-building speculative complex in Lebanon, Tenn. Al. Neyer sold the Class A, newly delivered asset.

JLL Capital Markets arranged the five-year, fixed-rate $40 million acquisition loan on behalf of the borrower. A life insurance company provided the financing.

Al. Neyer announced Alligood Industrial Park in late 2021, the company’s sixth industrial project in Lebanon at the time. Completed earlier this year, the two rear-load buildings encompass 175,950 square feet and 235,200 square feet, respectively. The property features 32-foot clear heights, 135-foot truck courts, 76 dock doors and ESFR fire sprinklers, as well as some 300 car parking spots.

READ ALSO: US Manufacturing Rebound Faces Real Estate Obstacles

Alligood Industrial Park occupies 36.4 acres at 200 Alligood Way. The property is near U.S. Route 231 and Interstate 41, roughly 30 miles east from downtown Nashville, Tenn. Companies in the surrounding area include Lifeway, Cracker Barrel and Famous Footwear, among others.

The JLL Capital Markets team included Senior Managing Directors Aldon Cole and Brian Carlton, alongside Associate Brad Vansant.

Nashville’s active industrial market

The Nashville industrial market saw $159 million in sales year-to-date as of July, with properties trading at an average $116 per square foot, according to a recent CommercialEdge report. The average rent was up 6.7 percent over a 12-month period, while the vacancy rate clocked in at 2 percent.

Nashville had approximately 4 million square feet of industrial space under construction as of July, representing 2 percent of stock. When adding planned and prospective projects, the metro’s pipeline would reach 4.5 percent of total stock.

One of the largest planned developments is Griffin Partners’ 2 million-square-foot industrial park in Lebanon, slated for completion in the third quarter of 2024. Another project will take shape in Murfreesboro, Tenn., where Distribution Realty Group eyed a 700,000-square-foot campus that will break ground in early 2024.

The post Pearlmark Real Estate Buys Nashville Industrial Asset appeared first on Commercial Property Executive.

One22One was Nashville’s largest office project completed in 2022. Image courtesy of GBT Realty Corp.

A joint venture of GBT Realty Corp. and Koch Real Estate Investments recapitalized One22One, a recently completed, 24-story office tower in Nashville, Tenn., with a $174.6 million senior construction loan originated by Canyon Partners Real Estate and J.P. Morgan. JLL Capital Markets represented the borrower.

GBT and Koch completed One22One at 1221 Broadway, in the Gulch neighborhood, a year ago. The partnership had secured a $141 million construction loan for the Class A tower in April 2020 from Mack Real Estate Credit Strategies.

The largest office project completed in Nashville in 2022, the building has 373,232 square feet of office space, 16,938 square feet of retail space and 13 stories of parking. A conference center, outdoor terrace, tenant lounge and fitness center are some of the tower’s amenities. Post-pandemic safety features include individual HVAC systems on each floor and touchless technologies such as keyless access to tenant suites and elevators.

READ ALSO: Today’s Most-Desired Office Amenities

Major tenants include Bradley Arant Boult Cummings LLP, a national law firm, and Slalom, a global management consulting company. FirstBank, the third largest Tennessee-based bank, has also leased 52,000 square feet at the property, on floors 13 and 14; some of that space will include FB Financial Corp.’s headquarters.

Just off Interstate 40, the tower is 1 mile from the Tennessee State Capitol and downtown Nashville and 2 miles from Nissan Stadium. A Whole Foods Market is across the street and there are more than 20 dining options within a 1 mile-radius. Several retail and entertainment options are also nearby.

George Tomlin, president & CEO of GBT Realty, said in a prepared statement the recapitalization positions the joint venture partners to take advantage of the rising demand and provide workspaces and amenities that companies are seeking in a post-pandemic environment. Matt Stewart, managing director of JLL’s Capital Markets group, added office properties like One22One continue to outperform and drive tenant and capital demand, particularly in a challenging capital markets environment.

Nashville’s robust office pipeline

Nashville had more than 3.3 million square feet of rental office space under construction as of July, a 5.8 percent expansion of existing stock that put the metro in the second spot nationally for new space underway as a percentage of stock, after Austin, according to a recent CommercialEdge report. However, only three projects totaling 509,000 square feet have started construction in the last 12 months.

One of the largest new office buildings will come online within the $1 billion mixed-use Nashville Yards project. Southwest Value Partners is developing the 566,000-square-foot tower for Amazon.

The post Nashville Office Tower Lands $175M Loan appeared first on Commercial Property Executive.

1030 Music Row is Nashville’s first mass timber office building. Image courtesy of Ampersand Studios

Miami-based flexible office provider Ampersand Studios has opened a 26,000-square-foot coworking location in Nashville, Tenn. The firm signed an 11-year lease with Northwood Investors at 1030 Music Row in November 2022, the agreement being brokered by Colliers.

Ampersand will occupy the building’s second floor. The location will feature private offices for teams between two and 25 members, along with creative spaces, such as a content room, a casting studio, a photography studio, video production studios and production offices. Elmington Capital is another tenant at the property, according to CommercialEdge data.

Completed in 2022, the five-story property is Nashville’s first mass timber sustainable office building. It spans 126,000 square feet and features 26,000-square-foot floorplates. Northwood acquired the asset last year for $55.2 million, the same source shows. Located at 1030 16th Ave. S. within the Music Row neighborhood, the building sits some 2 miles from downtown Nashville, in an Opportunity Zone.

As of February, Nashville had 629,000 square feet of confirmed coworking space and 1.4 million square feet of allocated space across 69 locations, representing 2.4 percent of the total rentable office space, according to a CommercialEdge market update. Serendipity labs recently expanded its footprint in the metro, opening a new 33,000-square-foot flex office location.

The post Ampersand Studios Opens Nashville Coworking Location appeared first on Commercial Property Executive.

Middle Tennessee Industrial Center. Image courtesy of Distribution Realty Group

Distribution Realty Group is one step closer to starting construction on Middle Tennessee Industrial Center, a 700,000-square-foot project in Murfreesboro, Tenn. The firm has purchased the 87.7-acre development site from Mary K. Murfree Family Partnership for $8.5 million, according to the Nashville Business Journal. Groundbreaking is set for early 2024.

To come online in two phases, the campus was designed to include four read-load buildings with 36-foot clear heights, LED lighting and office components. The property will cater to warehouse and logistics tenants.

Middle Tennessee Industrial Center will take shape along South Rutherford Boulevard near Interstate 24, some 36 miles southeast of downtown Nashville. Several major companies, such as Lineage Logistics, FedEx, Americold Logistics and Amazon, are also in the area.

Current industrial developments in Nashville

Since its founding in 2013, DRG has acquired and developed more than 10.8 million square feet of industrial and distribution facilities in several markets across the U.S., in states such as Tennessee, Indiana, Illinois and Mississippi. The firm currently has another Nashville-area project in the works; in partnership with PCCP LLC, the company is developing Beechcroft Industrial Park in Spring Hill, Tenn., with completion expected this November.

As of May, Nashville had 3.5 million square feet of industrial space under construction, representing 1.7 percent of stock, according to a CommercialEdge report. One of the ongoing developments, a speculative two-warehouse industrial project totaling more than 2 million square feet in Lebanon, Tenn., will be the largest of its kind in Nashville’s I-840 corridor when complete.

The post Distribution Realty to Build Industrial Park Near Nashville appeared first on Commercial Property Executive.

8 Cadillac Drive. Image courtesy of Serendipity Labs

New York-based flexible office provider Serendipity Labs will open a 33,000-square-foot coworking space in Brentwood, Tenn., a suburb of Nashville. The firm will occupy the third floor at one of the four buildings within the Creekside Office Park. The campus is part of the larger Maryland Farms mixed-use community, owned by The Brookdale Group.

The flex office location will encompass dedicated private offices, team private offices for groups of up to 10 people, as well as team suites for up to 100 people, board rooms, visual studios and accommodation for corporate events. On-site amenities comprise full-service hospitality staff, complimentary fruit and drinks, as well as quiet and wellness rooms. Tenants will also have access to building facilities including a fitness center, café and tenant lounge.

Located at 8 Cadillac Drive, the 129,000-square-foot building is just off Highway 254 and close to Interstate 65, while downtown Nashville is roughly 11 miles north. This is Serendipity’s second location in Nashville, after entering the market in September with a lease in the metro’s downtown.

Coworking space represents 2.4 percent of the total rentable office space in metro Nashville, according to a recent CommercialEdge market update. The data provider identified 69 locations totaling 629,000 square feet of confirmed space and 1.4 million square feet of allocated space.

The post Serendipity Labs Expands Nashville-Area Footprint appeared first on Commercial Property Executive.

Earhart Industrial Park. Image courtesy of Griffin Partners

Griffin Partners has started site work on Earhart Industrial Park, a speculative two-warehouse industrial project totaling 2 million square feet in Lebanon, Tenn.

The development off Interstate 840 and Highway 109 will be the largest industrial project in Nashville’s I-840 bulk industrial corridor when completed in the third quarter of 2024.

The first cross-dock building will have 863,573 square feet and 367 car parking spaces and 196 trailer spots. The second building will have nearly 1.2 million square feet and room for 448 cars and 284 trailers. Both warehouses will be 640 feet deep with a 40-foot clear height. There is land for development at the site, where the developer is considering adding more than 300 trailer parking spaces.

The site is fairly hilly, with more than 1 million cubic yards of earth being moved to prepare site for the two large warehouses. Griffin is estimating it will take nine months for the initial site work for the project.

Travis Covington, president of development at Griffin Partners, said in a prepared statement the company has tapped Foundry Commercial’s Industrial Services team out of Nashville to serve as leasing broker and bring the right tenant mix to Earhart Industrial Park.

READ ALSO: Top 5 Markets for Industrial Transactions

The team consists of Melissa Alexander, SIOR, W.B. Scoggin, CCIM, Casey Flannery and Warren Snowdon, SIOR.

Alexander, a partner at Foundry Commercial, said in prepared remarks there currently are no vacant buildings in the Lebanon industrial corridor, where most of the Nashville region’s bulk product exists, to accommodate tenants that need substantial square footage. She added Earhart is the first fully capitalized warehouse park coming out of the ground during a time when construction starts have been slowed or stalled on similar projects in the area.

Earlier projects

Griffin, a commercial real estate investment firm based in Houston, has acquired, developed or managed more than 100 properties with an aggregate value of more than $2.5 billion over the last 40 years. Earhart is the Houston-based firm’s third industrial development in Tennessee. Griffin is also developing Saturn Crossing, two industrial buildings totaling more than 203,000 square feet, along Saturn Parkway in Spring Hill, Tenn., south of Nashville. In March 2022, Griffin completed and sold Park 109, which is a four-building, 375,000-square-foot industrial park on the east side of Nashville.

In the firm’s home state, Griffin broke ground on Port 45, a two-building industrial park totaling 567,526 square feet in Wilmer, Texas, in July 2022. The tilt-wall warehouses are rear-load facilities and located on approximately 40 acres along Interstate 45.

Foundry invests not only in industrial properties but also office, retail, multifamily, health-care and other asset classes. The firm’s development and investment platform is currently invested in more than $3.5 billion in joint ventures and has more than $1 billion in active ground-up developments across the Sun Belt.

In December, Foundry broke ground on South Florida Gateway Distribution Center in Stuart, Fla., a speculative two-building project that will have more than 983,000 square feet of space. It was the company’s third groundbreaking in less than two months and second in Florida. A month earlier, Foundry began construction of Creekside Logistics, an approximately 370,900-square-foot light industrial campus in Smyrna, Tenn., in partnership with Principal Real Estate. It is the company’s first in metro Nashville and will have three buildings when completed later this year.

The post Griffin Partners to Build 2 MSF Warehouse Project appeared first on Commercial Property Executive.

Image by Jonathan Ross/iStockphoto.com

Office markets nationwide are still adapting to post-pandemic shifts, with major companies continuing to downsize and to rethink expansion plans. High interest rates and scarcer debt are also playing their part in a relative slowdown of office development. The Nashville office market had a strong position by the end of last year, as the metro’s favorable business climate has kept it growing.

Here is the latest report on how Nashville’s office market entered 2023, according to CommercialEdge data.

Downtown Nashville’s large projects

As of January, Nashville had 4.6 million square feet of rentable office space under construction. This represents an 8.0 percent expansion of existing stock, putting Nashville in the second spot nationally for new space underway as a percentage of stock, tied with Miami. Austin took the first spot, with new construction representing 10.3 percent of existing stock. Nationally, office space under construction amounted to 2.2 percent of stock in January.

Nashville’s top five largest office properties underway were all situated in the downtown area.

The $1 billion mixed-use Nashville Yards project—developed by Southwest Value Partners—contained two of the largest office buildings currently under construction. The larger one, at 566,000 square feet of rentable space, will be occupied by Amazon. The second one is planned to be mixed-use and is slated to comprise 465,000 square feet.

Lincoln Property Co. is also among the developers betting on downtown Nashville. The company is currently building a 535,000-square-foot luxury office building, located at 410 8th Ave. S., called Circle South.

In December, Convexity Properties obtained a $125 million loan for the development of a 15-story, 378,000-square-foot mixed-use project at 5 City Blvd. The property is slated to include 360,000 square feet of office space, 18,000 square feet of retail, and will come online in 2024.

Deliveries slowed down across Nashville

A single office property came online in the metro during the first two months of 2023, in the Franklin submarket. Boyle Investment Co. completed an office building—within the McEwen Northside master-planned community—measuring 126,000 square feet of office, and 15,000 square feet of retail and restaurant space.

ONE22ONE. Image courtesy of GBT Realty

In 2022, office completions across the Nashville market totaled 906,000 square feet—a 60.3 percent decline year-over-year, from the 2.3 million square feet of space delivered in 2021.

The largest of these was ONE22ONE, developed by a joint venture of GBT Realty and Koch Real Estate Investments. The 24-story, Class A building comprises 373,000 square feet of space, of which a significant portion was already leased. FirstBank signed on for 52,000 square feet of space, while an additional 120,000 square feet will be occupied by several other companies.

Office leasing in Nashville remained slow

Nashville’s office market recorded some leasing activity in 2022, but vacancy only moderately improved—the rate stood at 17.5 percent as of February, down 130 basis points year-over-year. Nationally, office vacancy clocked in at 16.5 percent.

The metro’s full-service equivalent listing rate was $31.6 as of February, up 4.1 percent year-over-year. Nationally, the rate stood at $38.3.

As companies continue to re-assess their post-pandemic needs for office space, leasing is still slow across most major metros. Layoffs in the tech sector especially contributed to this slowdown, with many expansion plans now on hold.

Sales went up in 2022

In 2022, transactions in Nashville’s office market totaled $1.3 billion, a 90.5 percent increase year-over-year. Sales amped up in the metro, with high-quality office space taking the first spot on investors’ lists. The average price per square foot reached $257 as of December, 4 percent higher than the national figure.

The largest sale of 2022 occurred in November. Northwood Investors paid $715 million for Fifth + Broadway, a mixed-use property that was completed in 2021 by Skanska USA and developed by Brookfield Properties. The asset includes 367,000 square feet of office space, 250,000 square feet of retail and entertainment, a 56,000-square-foot museum and 381 residential units.

Another large office sale closed in June, in the downtown submarket. Intercontinental Real Estate acquired the 1200 Broadway office tower for $295 million from Endeavor Real Estate Group. The 26-story property was completed in 2019 and is LEED Silver certified. The asset traded at roughly $344.6 per square foot, significantly above the market average.

Coworking gains traction in Nashville

As remote work gradually became more commonplace over the past three years, coworking companies sought to open locations in all major metros, and Nashville was no exception. As of February, the metro had 625,000 square feet of confirmed coworking space and 1.4 million square feet of allocated space across 69 locations—representing 2.4 percent of all rentable office space in the market.

By comparison, the largest coworking markets had similar figures—Manhattan’s office market had 13.4 million square feet of flexible space, representing 2.7 percent of all rentable office space, while Los Angeles had 6.9 million, or 2.3 percent.

Serendipity Labs Nashville. Image courtesy of Stream Realty Partners

Serendipity Labs opened its first location in Nashville last year. The coworking firm signed on for 21,100 square feet of office space at Tricera Capital’s L&C Tower, a 276,818-square-foot office building, located in the downtown submarket.

Miami-based flexible workspace provider Ampersand Studios also opened its first location in the metro last year. The company agreed to an 11-year, 26,124-square-foot lease at 1030 Music Row, a 126,000-square-foot boutique office property.

The post Nashville Office Market Starts 2023 on a Strong Note appeared first on Commercial Property Executive.

Image by Adriana Pop

TriOut Advisory Group has announced that a Tesla Motors Flagship Store will open at its 57,447-square-foot property in Franklin, Tenn. Expected to be launched in mid-2023, Tesla’s new full-service store will be one of the largest in the country.

The facility will feature a vehicle showroom, a service center, as well as superchargers. Tesla’s new store will be close to other dealerships, including Mercedes-Benz, Volkswagen, Nissan, Toyota, Hyundai and Infiniti.

The current ownership purchased the property in 2019, for $9.4 million, CommercialEdge data shows. Located at 300 Shingle Way in the Cool Springs area, the one-story, Class B property was built in 2006 and features 159 parking spots. Situated on a 7-acre lot, the building is parallel to Interstate 65 and close to Cool Springs Galleria, 7 miles from Brentwood, Tenn., 16.7 miles from downtown Nashville, Tenn., and within 19 miles of Nashville International Airport.

Tesla’s lease takes place as the electric vehicle manufacturer announced plans for another industrial building adjacent to its 4.3 million-square-foot Giga Texas manufacturing facility earlier in 2022, followed by its headquarters relocation to Austin in 2021.

The post Tesla to Open Largest Nashville-Area Flagship Store appeared first on Commercial Property Executive.

Providence Commons. Image courtesy of Phillips Edison & Co.

Phillips Edison & Co. has purchased Providence Commons, a 110,137-square-foot retail center in Mt. Juliet, Tenn. TA Realty was the seller, according to CommercialEdge data. A JLL Capital Markets team brokered the transaction.

The property previously traded in 2018, for $28.2 million, when it was sold by Boyle Investment Co., the same source shows.

Providence Commons comprises four buildings on a 23.1-acre site. The sale included an additional 7.2 acres of undeveloped land adjacent to the property. Its zoning allows for retail, office or hospitality development.

The retail center was 100 percent leased at the time of sale, anchored by Publix. Other tenants include Starbucks, Pizza Hut, Anytime Fitness, Precision Eye Care, Papa Johns and Subway.

Providence Commons is located at 631 S. Mt. Juliet Road, 2 miles south of the intersection of Interstate 40 and Route 171. According to JLL, Mt. Juliet is one of the fastest growing submarkets in the Nashville Metropolitan Area, with 84 percent population growth since 2010.

JLL Capital Markets worked on behalf of the seller. The team comprised Senior Managing Director Jim Hamilton, Managing Director Brad Buchanan and Associate Andrew Michols.

At the end of last year, JLL Capital Markets also brokered the $20 million sale of a 148,203-square-foot retail center in Chattanooga, Tenn., working on behalf of Wicker Park Capital Management.

The post Phillips Edison & Co. Acquires Nashville Retail Center appeared first on Commercial Property Executive.

An aerial view of Worldwide Stages campus. Image courtesy of Worldwide Stages LLC

Worldwide Stages LLC has opened a 38-acre, 320,000-square-foot complex for music, film and broadcast production in Spring Hill, Tenn., just south of Music City, better known as Nashville, Tenn.

Located at 5000 Northfield Lane, the site is the former headquarters of Saturn, a General Motors brand that was disbanded in 2010. The property was purchased by the City of Spring Hill in 2017 and was originally planned to be used for a new police headquarters, city hall and library, according to the Nashville Post.

WWS later purchased the site from the city, although the sale was delayed by several years due to the pandemic. The company completely renovated the property, investing millions of dollars. Today, the complex includes tour rehearsal facilities for musical stars and production space for diverse content creators to produce live-streaming events, music videos, commercials, television series and feature films.

READ ALSO: Developing LA’s Next Generation of Studios

WWS is already planning to expand at the site by adding more soundstages in response to industry demand. The company will also be investigating bringing its luxury-branded facilities to other entertainment-centric cities.

Bob Raines, executive director of the Tennessee Entertainment Commission, said in a prepared statement that the opening of the complex signals Tennessee’s growth and competitiveness in the entertainment sector on both local and national levels. He added that the complex will not only leverage the state’s internationally renowned music industry but also service the influx of television and motion picture professionals interested in producing the next generation of entertainment content.

A luxury entertainment campus

Kelly Frey, WWS’ CEO & president, said in prepared remarks that the complex was designed to feel more like a five-star hotel with soundstages and production space rather than an industrial warehouse soundstage. He pointed out that WWS wanted to create a luxurious safe haven for A-list entertainers that is also a functional production space.

One of the highlights is a speakeasy with a vintage 1920s solid wood bar that can be used for meetings, events or just to relax on-site. The campus also features thousands of square feet of luxurious production facilities, green rooms and professionally decorated artist studios and gathering spaces.

Other highlights include:

• Private 70-seat theater with audio equipment ideal for screening dailies or performing;
• On-site medical and security personnel supported by campus-wide facial recognition, software-driven access and other cutting-edge technology;
• Acres of private parking for personnel and production equipment;
• Easy access to major interstates in the area.

The post 320 KSF Studio Complex Debuts Near Nashville appeared first on Commercial Property Executive.

Image by 652234 via Pixabay.com

Convexity Properties, the real estate development subsidiary of DRW, is moving forward with its 5 City Blvd development, a 15-story, 378,000-square foot Class A mixed-use office and retail space in Nashville, Tenn.

The firm has obtained a $125 million loan from Goldman Sachs for the project, according to public records. In October of 2021, Convexity paid $11.7 million to acquire a 2.17-acre development site for the property from Cambridge Holdings.

Construction on 5 City Blvd is expected to begin toward the end of 2022, with a scheduled delivery in the third quarter of 2024. Space will be available for lease in the first quarter of 2025.

Upon completion, 5 City Blvd will host 360,000 square feet of office, sectioned off into 26,000- to 28,000-square-foot floorplates, as well as 18,000 square feet of ground floor retail. Amenities will include a flex conference center, fitness center, café lounge, concierge, catering kitchen, private parking and 5,700 square feet of shared and private terrace space. The developer has tapped CBRE First Vice Presidents Frank Thomasson and Byran Fort to market the office space.

READ ALSO: Economist’s View: How Employees’ Flight to Quality Impacts CRE

The OneCity picture

The complex will be built as a part of Cambridge’s 18.7-acre OneCity master-planned project, which is seeing the construction of 1 million square feet of office space, 35,000 square feet of retail, 600 apartments and Element Nashville West End, a 170-key hotel. Situated along Charlotte Avenue, the development is flanked by many of the city’s most affluent neighborhoods, and is within 2 miles of many of its top employers and universities, as well as its top retail, dining and entertainment offerings.

Nashville’s flight-to-quality

The Nashville office sector has continued to prosper, even in the face of repeated interest rate hikes that have muddied confidence in investing in the asset class. According to data from a third quarter 2022 report from Colliers, the city had 2.8 million square feet of space under construction as of the third quarter, with a net absorption of 157,000 square feet. Class A space in particular has seen a high demand, with 50 percent of new projects coming under lease, data from the report shows.

One recent high-profile office acquisition headline is KBS’ $175.5 million purchase of UBS Tower, a trophy high-rise building in downtown Nashville.

The post Convexity Properties Lands $125M Loan for Nashville Mixed-Use appeared first on Commercial Property Executive.

Stonemont Commerce Park 840. Image courtesy of Stonemont Financial Group

Stonemont Financial Group is one step closer to the groundbreaking of Stonemont Commerce Park 840, a two-building, 1.4 million-square-foot industrial park in Murfreesboro, Tenn. The developer intends to start construction on the project in the first quarter of 2023, with completion expected in the first quarter of 2024.

The development team also includes Frampton Construction as general contractor, while Site Engineering Consultants Inc. will serve as civil engineer. Lee & Associates will provide leasing and brokerage services for the project.

READ ALSO: Industrial Market Trends, Takeaways From SIOR CREate 360

Stonemont Commerce Park 840 will take shape on 157 acres at 4543 Sulphur Springs Road. Upon completion, the campus will comprise a 1.2 million-square-foot building with 40-foot clear heights and a smaller, 273,000-square-foot facility with 36-foot clear heights. The property is set to feature more than 830 parking spaces.

Situated along Interstate 840 and within 4 miles of Interstate 24, the development site is 35 miles from downtown Nashville and the city’s international airport.

Stonemont stays the course

With a portfolio totaling 25.2 million square feet, Stonemont continues to be an active industrial investor in nearly every dateline market in the U.S, with four recent acquisitions in Columbus, Ohio, Denver and Chicago, according to CommercialEdge data.

Additionally, the firm has been pursuing its development endeavors, particularly in the South and Midwest. In August, Stonemont broke ground on Castings Commerce Park, a three-building, Class A industrial park in Columbus. Another project, that Stonemont started in March, is Westinghouse35, a 230,000-square-foot speculative development in Georgetown, Texas.

Nashville’s industrial profile

Nashville’s emergence as an e-commerce-based shipping and logistics nexus has led to surging demand and high average rents. With a vacancy rate of 1.4 percent as of October, alongside region’s highest year-to-date sales price per square foot of $152, the capital of The Volunteer State remains one of the strongest-performing industrial markets in the South, in relative comparison to national leaders such as Dallas and Houston, data from a recent CommercialEdge report shows.

The post Stonemont to Build 1.4 MSF Nashville Industrial Park appeared first on Commercial Property Executive.

The Cubes at Sparta Pike. Image courtesy of CRG

CRG has acquired a 200-acre property in Lebanon, Tenn., and plans to develop it into The Cubes at Sparta Pike, a four-building, 2.8 million-square-foot industrial park.

The site is 30 miles east of downtown Nashville, and the buildings to be developed there will range in size from about 250,000 square feet to 1.4 million square feet. The project marks the company’s entry into the Nashville industrial market.

The Cubes at Sparta Pike is designed to accommodate e-commerce, distribution, third-party logistics and manufacturing users. Its buildings will feature 40-foot clear heights, extra-wide staging bays with grade-level doors, deep truck courts, and ample trailer storage and car parking. The site is also served by two substations, providing users with the potential for redundant power.

READ ALSO: Optimistic Outlook Predicted for Industrial Sector

Located at 1526-1846 Sparta Pike, the property is less than a mile south of a full interchange on I-40 and about 24 miles from Nashville International Airport. The site also features frontage along the Nashville & Eastern Line Railroad.

In a prepared statement, Kevin Scott, vice president of investments and development at CRG, noted the Nashville industrial market’s rising need for distribution space alongside an historically low level of vacancy.

Jim Rodrigues, president of Lee & Associates National, has been retained to oversee leasing and marketing to prospective build-to-suit users.

CRG has planned, broken ground on or completed more than 53 million square feet of The Cubes projects in regional logistics hubs across the U.S.

Tight spaces

The metro Nashville industrial market had more than 4.2 million square feet of absorption in the third quarter, according to Lee & Associates. Most of that, about 3.3 million square feet year to date, was in the Wilson County submarket, where The Cubes at Sparta Pike will be built.

Overall industrial vacancy in the third quarter decreased 30 basis points from the prior quarter, dropping to 2.4 percent, making this the 12th consecutive quarter in which Nashville’s industrial market posted a sub-3.0 percent vacancy.

In addition, the Wilson County submarket saw 1.3 million square feet of preleasing activity in the third quarter.

Just a few weeks ago, Foundry Commercial broke ground on a 370,900-square-foot light industrial campus in Smyrna, Tenn., in southeastern metro Nashville. Foundry’s partner in the spec project near I-24 is Principal Real Estate.

The post CRG Acquires Site for 2.8 MSF Industrial Park  appeared first on Commercial Property Executive.

Fifth + Broadway. Image courtesy of Northwood Retail.

Northwood Investors has acquired Fifth + Broadway, a mixed-use, open-air property in Nashville, Tenn., for $715 million, according to the Nashville Post.

Pacific Life provided acquisition financing for Fifth + Broadway, which was owned and operated by Brookfield Properties. The mixed-use asset includes a retail component, The Place residences and the 501 Commerce office tower.

The property came online in 2021 and was delivered by Skanska USA. Brookfield Properties developed the property in partnership with OliverMcMillan and Spectrum|Emery Properties. The asset is considered one of the largest mixed-use developments in the history of Nashville, as well as Tennessee.

Located at 1221 Broadway, less than one mile away from Fifth + Broadway, a new office tower was recently completed by GBT Realty and Koch Real Estate Investments. The Class A building was designed by architecture firm Gresham Smith.

A revolutionary Nashville project

Designed by Gresham Smith and Gensler, Fifth + Broadway sits on a 6.2-acre site that replaced the Nashville Convention Center. The project includes a 250,000-square-foot retail and entertainment space, the 56,000-square-foot national Museum for African American Music, 367,000 square feet of office space, 381 residential units and 2,000 parking spaces.

501 Commerce is a 25-story LEED-certified office building that includes a fitness center, conference rooms and 952 parking spaces. The tenant roster features Polsinelli, K&L Gates and AllianceBernstein. The Place is a 34-story residential building. Amenities include a fitness center, spa, swimming pool, clubhouse and business center. The dining and retail center hosts tenants such as Assembly Food Hall, The Twelve Thirty Club, Carhartt, Ray Ban and Sephora, among others.

The center is located in the heart of the Arts District. The surrounding area includes several city landmarks, such as Country Music Hall of Fame and Museum, War Memorial Auditorium, Musicians Hall of Fame & Museum and the Walk of Fame Park.

Northwood’s office portfolio

This transaction marks Northwood’s fifth Nashville asset the company has invested in. Earlier this month, Ampersand Studios signed a lease for 26,124 square feet of space at 1030 Music Row, a boutique office Northwood recently acquired for $55.2 million. CommercialEdge data shows that the company owns three other office buildings in this market. Across the U.S., the company owns 65 office assets, of which 50 are Class A properties.

The post Northwood Investors Pays $715M for Mixed-Use Asset appeared first on Commercial Property Executive.

Creekside Logistics groundbreaking. Image courtesy of Foundry Commercial

Foundry Commercial has broken ground on Creekside Logistics, an approximately 370,900-square-foot light industrial campus in Smyrna, Tenn. The speculative project, which Foundry is developing in partnership with Principal Real Estate, marks the company’s first foray into development in metropolitan Nashville and will cost approximately $70 million to bring to fruition.

“One of the most attractive things about investing in Nashville is the combination of population growth combined with the diverse economy,” Jason Holwerda, partner & Nashville market leader for Foundry Commercial, told Commercial Property Executive. “In a project like Creekside Logistics, we see demand coming from several different sectors that we believe will hold up in a more challenging economic environment.”

READ ALSO: CRE Braces for Interest Rate Hike No. 6

Located near Interstate 14, Creekside will take shape roughly 25 miles southeast of downtown Nashville. The project will carry the address of 8110-8130 Tridon Drive, sprouting up on a 43-acre site that Foundry acquired in August 2022 for $13 million. “We could not have gotten to the point where we are today without the help of the land seller and the first tenant in the project, Ideal Tridon,” Holwerda said.

Securing a site for industrial development in metropolitan Nashville was no simple feat. “Finding land in middle Tennessee is just difficult mainly due to the topographic challenges in the region,” he added. “There are many areas that are too cost-prohibitive to develop because of the amount of sitework that would potentially be required.”

Upon completion, the three-structure logistics park will consist of the 88,400-square-foot Building 1, the 147,300-square-foot Building 2 and Building 3, which will encompass 135,200 square feet. All three facilities will feature tilt-wall construction and ample car parking space. Additionally, Creekside is designed to accommodate trailer parking and tenants of various size needs, with spaces as small as approximately 17,900 square feet.

Foundry and Principal are relying on Synovus Bank for financing for Creekside and the team has tapped Layton to serve as general contractor for the project. Delivery is expected in the third quarter of 2023.

READ ALSO: Top 5 Markets for Industrial Construction Activity

“We continue to be excited about the demand in the Greater Nashville region and are optimistic about the future growth in Nashville,” Holwerda concluded. “Despite some of the recent headwinds in the economy at large, we believe in the long-term location of this project and the continued need for high quality, Class A projects on the I-24 corridor.”

Needy in Nashville

It appears Foundry’s first development endeavor in the Nashville market is a timely undertaking. Developers have been highly active in Nashville’s industrial sector over the last few years, eager to keep up with growing demand. However, certain conditions have precipitated a change of late.

“Excavators were quiet in Q3 2022 with only one building breaking ground in the Nashville industrial market,” according to a report by JLL, “Rising interest rates and economic uncertainty have led many developers to pause groundbreaking plans until 2023. Some construction projects scheduled to deliver in Q4 2022 may also be delayed due to supply chain issues for materials and labor shortages.”

In the midst of a precarious economic environment, Foundry is managing to keep its pipeline of projects flowing. Including Creekside, the company currently has 10 active developments valued at more than $1 billion in progress via its Development & Investments platform. Most recently, Foundry broke ground on a 427,000-square-foot industrial development in Coral Springs, Fla.

The post Foundry Commercial Enters Nashville’s Development Market appeared first on Commercial Property Executive.

1030 Music Row

Ampersand Studios, a Miami-based flexible workspace provider, has signed an 11-year, 26,124-square-foot lease for a coworking location in Nashville, Tenn. The space is part of 1030 Music Row, a 112,292-square-foot boutique office building recently purchased by Northwood Investors for $55.2 million, according to CommercialEdge data. Vice President Brian Casey of Colliers Nashville brokered the transaction for the tenant.

The commitment marks Ampersand’s second coworking location, besides its flex office space in Miami. The new premises offers private offices, dedicated workspaces, virtual offices, meeting rooms, as well as access to creative studios and collaboration areas, designed for entrepreneurs, creators and dynamic companies. The content-creator membership offers access to production studios, rental equipment, equipped content rooms and vinyl backdrops.

Located at 1030 16th Ave. S, within the Music Row neighborhood, the coworking space is less than a mile from interstates 40 and 65. Numerous dining and entertainment options are within walking distance of the property, while downtown Nashville is roughly 2 miles away.

The high demand for flexible workspaces in the current hybrid-work dynamic continues to accelerate the expansion of the coworking market. A few months ago, Serendipity Labs also opened a new flex office space at L&C Tower in Nashville.

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840 Logistics Center. Image courtesy of Westmount Realty Capital

Westmount Realty Capital has sold a 709,652-square-foot industrial asset in metro Nashville, Tenn. 840 Logistics Center is a Class A distribution facility that Westmount had acquired in 2020 for $30.9 million, according to CommercialEdge data.

“The successful sale of this asset stems from our continued dedication to acquiring well-located functional industrial property in growth markets at an attractive basis going in,” Brant Brown, president & COO of Westmount, told Commercial Property Executive. “From there, the value was further created by executing a business plan that stabilized the asset with third-party logistics tenants benefiting from the building’s physical specs and immediate access to Interstate 840.”

READ ALSO: Top Projects That Will Reshape Nashville

840 Logistics Center interior. Image courtesy of Westmount Realty Capital

Built on 44 acres in 2008, the warehouse features 32-foot to 36-foot clear heights, 366 parking spaces and 76 trailer stalls. Westmount has invested several million dollar in property improvements in the past two years; upgrades included epoxy floor sealant, new dock and light packages and LED lighting, among others.

The facility was fully leased at the time of sale by two third-party logistics tenants. One of them, Superior 3rd Party Logistics, signed a 237,000-square-foot, five-year lease at the location in 2019.

Located at 245 Couchville Industrial Blvd. in Mt. Juliet, in the Wilson County submarket, 840 Logistics Center is adjacent to Interstate 840, also having access to interstates 24, 40 and 65. The property is in a high-growth area, as Wilson County accounted for 72 percent of the Nashville area’s industrial leasing activity in the third quarter of this year, according to a JLL report.

Industrial spaces, in high demand

JLL research shows demand for industrial spaces increased in metro Nashville during this year’s third quarter. The industrial vacancy rate reached a new low at 3 percent, marking a 20-basis-point improvement over the quarter.

Nearly 8.4 million square feet of industrial space was under construction in the metro at the end of October, according to CommercialEdge information. One of these developments is Beechcroft Industrial Park, a 815,530-square-foot project of PCCP LLC and Distribution Realty Group.

The post Westmount Realty Sells Nashville Industrial Center appeared first on Commercial Property Executive.

Beechcroft Industrial Park. Image courtesy of PCCP LLC

PCCP LLC and Distribution Realty Group are planning the construction of Beechcroft Industrial Park, a three-building project in Spring Hill, Tenn. The two firms formed a joint venture to develop the industrial property, which will be located near a major manufacturing facility for General Motors. Construction is expected to start in October 2022, with an estimated completion in November 2023.

Beechcroft Industrial Park will total 815,530 square feet of speculative warehouse space. The project calls for a 228,580-square-foot rear-loading building, a 244,950-square-foot rear-loading building and a 342,000-square-foot cross-docked building. The 63-acre site will also provide tenants with 716 car parking spaces and 119 trailer parking spaces.

READ ALSO: Industry Embraces Reshoring Initiatives

Located at 825-845 Beechcroft Road, the Beechcroft Industrial Park will be 38 miles south of downtown Nashville. Ryan Dodge, managing director at PCCP, said in prepared remarks that the area is an active industrial node, and that Beechcroft Industrial Park will be adjacent to General Motors’ largest automotive manufacturing facility in North America. PCCP expects its industrial park to see demand from several tenant types, including any automotive-related suppliers due to the proximity to General Motors’ plant.

Growing demand for Nashville’s industrial market

According to JLL’s second-quarter report on Nashville’s industrial market, the metro is seeing a declining vacancy due to strong tenant demand. The metro’s average industrial vacancy rate dropped to a historic low of 3.2 percent as of the second quarter of 2022, with high demand for spaces between 50,000 and 200,000 square feet, and very few options for tenants looking for spaces larger than 300,000 square feet. The market’s average asking rent remained above $6 per square foot and is anticipated to remain high, while plenty of industrial projects are expected to start construction.

Besides the Nashville metro, PCCP is also working on a 1.5 million-square-foot speculative industrial park in Duncan, S.C., that will similarly have three buildings. The firm partnered with Panattoni Development Co. in January to develop the Tyger Ridge Logistics Center. PCCP is also working with Lincoln Equities Group to build a warehouse and distribution center in Bayonne, N.J., that landed acquisition and construction financing in November.

The post PCCP, Distribution Realty Plan Nashville-Area Project appeared first on Commercial Property Executive.

Serendipity Labs Nashville. Image courtesy of Stream Realty Partners

Serendipity Labs has opened a new coworking location at L&C Tower, a 276,818-square-foot office property in downtown Nashville, Tenn. The building is currently owned by Tricera Capital, according to CommercialEdge data. Associated Paul Perona of Stream Realty Partners brokered the transaction on behalf of the tenant.

The company will lease 4,800-square-foot and 5,800-square-foot suites on the second floor of the building, offering flex spaces for teams varying from 24 to 29 members and 10,500 square feet of office space on the third floor of the building. Coworking options at the space include dedicated desks, private offices, team rooms, as well as meeting rooms suitable for 15 to 40 people and work lounge areas. Amenities at the Nashville space include contactless entry, ergonomic chairs, a lab cafe, focus and wellness rooms and high-end Wi-Fi.

Located at 159 Fourth Ave. N., the property is within walking distance of numerous dining options available on Church Street and within Nashville city center. Several bus stations, connecting the property to other neighborhoods of the city, are also close to the office space. Other tenants of the building include Dunn Brothers Coffee, Propak Logistics, Woods Aesthetics, Kharis Foundation and First Quality Management.

Serendipity Labs is among the companies that registered demand above pre-pandemic levels late last year, currently offering coworking locations across 14 states and in the U.K. The company is planning another flex office location in the New Heights District of Nashville, Tenn., slated to open in the second quarter of next year.

The post Serendipity Labs Opens Nashville Coworking Space appeared first on Commercial Property Executive.

A joint venture between GBT Realty and Koch Real Estate Investments has completed ONE22ONE, a 24-story, 373,000-square-foot Class AA office tower in Nashville, Tenn. Firstbank will occupy 52,000 square feet on floors 13 and 14, which will include FB Financial Corp.’s headquarters. CBRE serves as the sole leasing partner.

Brasfield & Gorrie was the general contractor, while Gresham Smith served as the project’s architect. In 2020, Mack Real Estate Credit Group provided $141 million in construction financing. The project was led by GBT Realty’s Jeff Pape, managing director, alongside Senior Vice President Fiona Haulter and Vice President Olivia Dial.

A trophy tower in Nashville’s Gulch neighborhood

Firstbank is not the only announced tenant, as an additional 120,000 square feet has been secured by several firms. Chotto Matte restaurant leased 11,000 square feet on the first- and second-floor restaurant space. A total of 200,000 square feet of office space is still up for lease. Frank Thomasson, Taylor Hillenmeyer, Janelle Gallagher and Byran Fort form the CBRE team in charge of leasing the office tower.

Amenities at the office tower include a fitness center, tenant lounge with workspace and market, outdoor deck, wellness room and conference facility. The property features independent HVAC Systems as well as touchless elevator dispatching and gateless parking technology.

Located at 1221 Broadway in the LEED-Silver certified Gulch neighborhood, the tower is across the street from a Whole Foods Market. More than 20 dining options are available within a 1-mile radius, alongside several retail and entertainment options. Downtown Nashville is also 1 mile north of ONE22ONE.

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1200 Darrell Waltrip Drive. Image courtesy of Thermo Fisher Scientific Inc.

Thermo Fisher Scientific Inc. has opened an approximately 400,000-square-foot bioprocessing production plant in the Nashville area as part of the long-term expansion of its bioprocessing production infrastructure.

The $105 million, build-to-suit property in Lebanon, Tenn., a development project of Panattoni, marks the scientific technologies provider’s largest single-use manufacturing site in its portfolio, and one of the largest such facilities in the world.

Sited roughly 35 miles southeast of Nashville’s central business district, Lebanon may not be known for its music, but it is a draw for industrial users. Cracker Barrell maintains its North American headquarters in the area and Amazon operates a 1 million-square-foot fulfillment center nearby. Thermo Fisher’s new plant is sited within Panattoni’s Speedway Industrial Park, a 1,400-acre logistics and bulk distribution complex located on the former Nashville Superspeedway along Interstate 840.

Carrying the address of 1200 Darrell Waltrip Drive, Thermo Fisher’s new plant delivered in the third quarter of 2021, and is also known as Speedway Building. The facility’s opening resulted in the creation of 300 new jobs and upon the plant’s completion, it will accommodate as many as 1,400 workers in various positions. Further development at the property will include the addition of a 92,000-square-foot clean room.

Nashville evolution

Nashville is expanding its horizons beyond the Music scene and is moving up on the list of the leading life science hubs in the U.S., having recently ranked in the top 25 of CBRE’s Life Sciences Research Talent 2022 report. The metro area is home to notable densities of data scientists, biochemists and biophysicists and is also home to Vanderbilt University Medical Center, which received $462 million in funding from the National Institutes of Health in 2021.

“There are several emerging clusters of research talent growing faster than average,” according to the CBRE Life Sciences Research Talent 2022 report. “Some of the outsized growth in these markets is due to their world-class research institutions such as Vanderbilt University Medical Center in Nashville, where National Institutes of Health funding grew by more than 50 percent between 2016 and 2021. These smaller life sciences clusters also benefit from larger, demographic tailwinds as some of the fastest growing regions in the U.S. and saw a boost of in-migration in 2020 as the COVID-19 pandemic arose.” All of the aforementioned conditions apply to Nashville.

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Bridgestone’s Warren County plant. Image courtesy of Bridgestone Americas, Inc

Bridgestone America and state officials have announced a new $550 million expansion of its truck and bus radial tire plant in Morrison, Tenn.

The expansion and modernization plan for the existing plant will increase its size by 850,000 square feet and add 380 new jobs to the Morrison market. 1,100 people are already employed at the plant. This will bring Bridgestone to a total of nearly 10,000 U.S.-based manufacturing workers.

READ ALSO: Sustainability Takes Center Stage at ULI Conference

The Warren County Tire Plant opened in 1990. It is currently 2 million square feet and will increase to more than 2.8 million square feet after construction is completed, in May 2024. The plant is already one of the firm’s most productive global operations, producing its 70 millionth tire in late 2021.

Following the expansion, the Warren County plant will be able to handle an increased capacity as well as integrate more modern technologies. All tires produced will have RFID (radio frequency identification) tags allowing for better asset management and retreading. AI control technology will be implemented to increase productivity and better utilize manufacturing knowledge and data. Further technology incorporated will aid with digital readiness in tires, such as the integration of tire-mounted sensors for data insights on efficient fleet management.

These new advancements will help Bridgestone reach its goal of carbon neutrality by 2050. In 2004, the Warren County tire plant site became a certified wildlife habitat, dedicating 680 acres to local nature and wildlife. Local students from the Warren County schools visit the site for classes and trail walks.

Tennessee industrial expansion

In prepared remarks, McWhorter said that Tennessee’s strong workforce as well as business-oriented climate is attracting corporations. Bridgestone has been present in Tennessee for four decades, while other companies are currently building there as well.

In March Oak Street Real Estate Capital funded a $90 million construction facility for Portobello America east of Nashville, Tenn. Amazon announced plans in 2021 to break ground on its 8th Tennessee fulfillment center in 2022.

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For nearly a decade, Nashville has ranked as one of the country’s top metros for both population and employment growth. Over the past couple of years, Music City benefited from accelerated in-migration, and companies rapidly followed suit. Numerous large-scale, mixed-use developments are currently under construction across the metro, as undeniable proof of the city’s strength and allure.

“Nashville as a whole has a lot going for it—the culture, the weather, the cost of living, the diversity and a pro-business, pro-growth community that continues to attract both corporations and talent,” Andrew Donchez, principal at locally based investment and development firm SomeraRoad, told Multi-Housing News.

With significant underutilized industrial sites in strategic locations, Nashville has caught the eyes of both developers and investors. Downtown Nashville has been going through a thorough overhaul in the past decade, and most of the city’s current large-scale developments are clustered around this area.

Here are some of the most significant ongoing real estate projects that have the potential to reshape the city’s skyline in the years to come.

1. Neuhoff

In 2019, developer New City Properties acquired a 14-acre site in Nashville’s Germantown neighborhood, on the western bank of Cumberland River. The site comprised buildings that used to house a meat packing facility built in the 1920s. In mid-2021, the company joined forces with Cousins Properties and entered into a joint venture partnership to develop Neuhoff, a new mixed-used development. Cousin’s $275 million investment secured a 50 percent ownership in the project’s first and second phases.

The first phase is set to include 388,000 square feet of office space, 60,000 square feet of retail and 542 multifamily units, a new 14-story office building, as well as the adaptive reuse of an existing structure dubbed the “curved building.”

John Clifford, founding principal at S9 Architecture—the studio behind the design of Neuhoff—told MHN that the development establishes a new sub-neighborhood that connects Germantown in the north, south and west. The project’s other main goals include maintaining the slaughterhouse buildings, as well as creating public access to the river.

We did not want this to be a ‘development project’ but, instead, an organic evolution of the Germantown community. … We wanted the locale to convey that it is a public realm for everyone and for myriad uses. Most important, we wanted the Germantown area to celebrate and understand the historic reason behind its existence—the slaughterhouse—and also experience its incredible access to the riverfront,” Clifford said.

The existing buildings had been abandoned for half a century and their structural integrity was unknown. But after establishing the condition of the existing conglomerate of seven buildings, the architect made the modifications that enabled them to be used as modern office and retail space. Moreover, the newly created open courtyards provide air and light to the development.

Neuhoff is well underway, with the first office tower close to topping out and the adaptive reuse portion under construction. Completion of the project’s first stage is expected in the second half of this year.

2. Nashville Yards

Developed by Southwest Value Partners, Nashville Yards is a $1 billion megadevelopment in downtown Nashville’s western edge, on a site that once served as a rail yard. The 18-acre mixed-use development was first announced in 2017 and is slated to comprise more than 3.5 million square feet of office space, 400,000 square feet of retail and entertainment space, more than 1,000 residential units and hotels totaling 1,100 keys.

The project is also set to feature a total of seven acres of green space, including Railfront Park, a 1.3-acre privately developed public park that will serve as the “front door” and connect the community to the nearby Gulch neighborhood.

“Because of the size and dynamic nature of the site, we’ve created an extremely flexible framework that’s been updated more than 20 times over the years to account for various changes,” said Don Reynolds, executive vice president at Gresham Smith, the studio responsible for the design of the masterplan. 

In late 2018, Amazon announced that it will open offices at Nashville Yards and subsequently create 5,000 jobs. The tech giant will occupy two office towers, the first of which already delivered in November 2021. Situated at 101 Platform Way North, the first tower rises 20 stories and encompasses 550,000 square feet. The second, 26-story tower will create an additional 616,000 square feet, with completion set for 2023.

Nashville Yards’ first component—the 591-key Grand Hyatt Nashville hotel—debuted in October 2020, comprising 784,000 square feet across 25 stories at 1000 Broadway. The third, 35-story office building known as Tower 3, broke ground in September 2021 and landed a new tenant the next month, when the largest law firm in Nashville, Bass, Berry & Sims PLC, agreed to prelease the top eight floors of the 650,000-square-foot tower. Pinnacle Financial Partners will also relocate its headquarters to the tower.

At the beginning of this year, Gresham Smith submitted a masterplan update for the Nashville Yards development that includes multiple mixed-use structures located at 901 and 1001 Church St., spanning a total of 7.9 acres, according to Reynolds. Plans call for the construction of an entertainment district, co-developed with Anschutz Entertainment Group. In addition to Tower 3, there are also plans to construct another 43-story, 800,00-square-foot office high-rise.

“Resiliency in these large developments is critical to their success, and during design that translates into flexibility and diversity,” Reynolds commented, when asked about how the pandemic impacted the design of the project. “Retail and office spaces are designed to flex between uses, blurring the lines between what is considered standard for office/entertainment/retail spaces.”

3. Ritz-Carlton

M2 Development Partners is bringing the first Ritz-Carlton hotel to the Tennessee capital’s SoBro District. Plans call for two mixed-use high-rise towers designed by Skidmore, Owings & Merrill that will span a total of 1.2 million square feet, including a 5-star Ritz-Carlton Hotel, Ritz-Carlton Residences and retail space.

“Taking inspiration from the surrounding landscape and the architectural vernacular of the southern porch, we designed the towers with a series of outdoor, wraparound terraces,” Scott Duncan, partner at SOM, said in a prepared statement.

The taller, 46-story skyscraper will include the 242-key hotel, 165 luxury residences and a pool. The second, 32-story tower will house 185 rental apartments. The project is aiming for LEED Gold certification, with groundbreaking of the $585 million mixed-use development planned for this year.

4. Paseo South Gulch

Developed by SomeraRoad, Paseo South Gulch is situated within Nashville’s Gulch neighborhood and comprises the adaptive reuse of two older structures, as well as two newly erected buildings. When fully developed, Paseo South Gulch will have more than 600 apartments, roughly 23,000 square feet of retail space, as well as a 58,000-square-foot office building, with additional creative office space in one of the renovated assets.

“The strengths of this project are really the strengths of Nashville as a whole. There’s a demand and appetite for growth in Nashville that is tough to match anywhere else in the country,” Donchez told MHN.

According to Donchez, the name “Paseo” comes from the interconnectedness of the pedestrian walkways that bind the various facilities, which help create a live-work-play micro-neighborhood. “We tried to emphasize a sense of community and connectivity, focusing on activating the street-level experience in a unique way that brings people together with outdoor programing, local retailers and creative companies,” he said.

The adaptive reuse portion of the project has already been completed and includes the former Antiques Mall and Voorhees buildings. The retail space has welcomed its first tenants: GoodVets, Mexican restaurant Maiz DLV and Two Hands Café.

The first new residential tower, dubbed Prima, broke ground in February, when the developer secured a $128 million ground lease for the project. The 16-story building is set to comprise 278 residential units and 18,000 square feet of Class A office space. Clark Construction serves as the project’s general contractor, with completion anticipated in early 2024.

5. Reed District

In early November 2021, a partnership of Barings and Hines purchased a 12-acre gateway site in Midtown Nashville, with plans to develop a 2.7 million-square-foot mixed-use development called Reed District. The duo intends to convert the site into a live-work-play destination, with a major focus on music, art, food and entertainment.

“The Reed District will be a transformative development connecting the West End and Downtown Nashville,” Chris Black, managing director at Barings, said in a prepared statement. 

The developers are aiming for a sustainable approach and plan to achieve LEED and WELL certifications for the buildings. The first phase of the project is set to encompass 800,000 square feet of residential, office, hospitality and retail space. The office portion will comprise a new, 300,000-square-foot building, as well as the adaptive reuse of a former Coca-Cola bottling plant into 100,000 square feet of creative office space.

The initial stage of Reed District will also include a 300-unit residential building and a 250-key hotel, as well as significant green open space. Construction is slated to commence in the second quarter of 2023.

6. The Riverside

the Riverside. Image courtesy of Skidmore, Owings & Merrill

Years in the making, the $2.5 billion Riverside megadevelopment is planned to create 5 million square feet of mixed-use space, comprising residential, retail, office and entertainment facilities. With Ewing Properties as developer and SOM as architect, the Riverside will span a total of 65 acres in Northwest Nashville.

The site along West Trinity Lane is located 3 miles from downtown Nashville and is mostly unoccupied. The project is slated to create a direct connection to the downtown area via water. The Riverside will also offer multilayered public spaces spanning more than 25 acres, including three interconnected parks.

In April 2022, the development team submitted a rezoning request for the project.

7. River North

Spanning 105 acres along Cumberland River and just across the river from Germantown, River North is another mixed-use development taking shape in Nashville’s East Bank area. Local studio HASTINGS Architecture is behind the design of the project, situated in an underutilized industrial area.

MRP Realty and Creek Lane Capital purchased 12.7 acres of the site to make way for a 1.3 million-square-foot live-work-play neighborhood, connected through green spaces, parks and walkways. The site is adjacent to the Oracle Corp.’s upcoming $1.2 billion, 60-acre riverfront tech campus, set to bring 8,500 jobs to the metro.

Scheduled to be delivered in two stages, the $263 million first phase of the project—dubbed The Landings—will create a total of 817,070 square feet across four buildings, according to REBusiness Online. Plans call for 651 apartments across two separate buildings—which will be known as Oxbow and The Wayward—78,000 square feet of office space, 80,000 square feet of retail, as well as new outdoor spaces, including close to a mile of riverfront greenway, an open-air market and waterfront dining options.

Using a $160 million construction loan, developers broke ground on this first phase of the project in October 2021, with completion scheduled for 2023. Phase II is set to create additional residential and retail space.

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Reed District. Image courtesy of Barings and Hines

Twelve acres at the gateway to Midtown Nashville are destined to become home to a mixed-use project now that Barings and Hines have joined forces on the acquisition of the site. Together, the joint venture partners will erect the Reed District, a 2.7 million-square-foot, live-work-play destination with a focus on music, art, food and entertainment.

Both Barings and Hines are major proponents of sustainable development, so the Reed District will be a model of environmentally friendly development, and will incorporate ESG-specific features. The partners will target LEED and WELL certifications for the property. Additionally, they will create an activated green space to serve as the anchor of the state-of-the-art project.

READ ALSO: $2.5B Waterfront Project Coming to Nashville

Reed District. Image courtesy of Barings and Hines

Barings and Hines acquired the dozen acres from the Reed family, longtime owners of the property, for an undisclosed amount. The partners plan to develop the Reed District in phases, with Phase I expected to encompass 800,000 square feet of residential, hospitality and retail offerings, as well as office accommodations.

The 400,000 square feet of next-generation office space will consist of a new 300,000-square-foot high-rise and the most distinctive element of the development, a historic project involving the adaptive reuse of the century-old former Coca-Cola bottling plant. Located at 1525 Church St., the 1920s-era building will be converted into a 100,000-square-foot creative office workspace with added retail offerings.

Office needs in Nashville

Nashville is in recovery mode, but the Midtown submarket is faring better than many others in the metro. According to a JLL report, Midtown posted approximately 20,000 square feet of positive net absorption in the third quarter and average direct asking rents rose to $40.57 per square foot, the highest in Nashville.

Reed District. Image courtesy of Barings and Hines

Metropolitan Nashville in general is on the upswing and Midtown will see its good times get even better. “A backlog of transactions patiently awaits the return of greater stability in the market, and absorption will likely pick up significantly once the public health crisis subsides,” JLL noted.

Barings and Hines expect to commence construction of the Reed District in the second quarter of 2023.

Nashville is becoming a modern-day, mixed-use mecca of sorts. Southwest Value Partners is hard at work, developing the $1 billion Nashville Yards. In February of this year, at a cost of $450 million, Skanska USA delivered Fifth + Broadway, the largest single-phase, mixed-use development ever undertaken in the city of Nashville at the time. And two weeks ago, at the end of October, Ewing Properties announced plans for Riverside, a $2.5 billion, 5 million-square-foot, live-work-play compound along the Cumberland River. All three projects have notable office components.

The post Hines, Barings Unveil Nashville Megaproject appeared first on Commercial Property Executive.

Eight years in the making, a $2.5 billion mixed-use community is now in line to sprout up along the Cumberland River in Nashville. Real estate developer Ewing Properties just announced that it will build the Riverside, a 5 million-square-foot, live-work-play destination that will spark the creation of a riverfront corridor in the northwest section of the city.

the Riverside will take shape on 65 coveted acres just 3 miles from downtown Nashville, which will be accessible from the project via water taxi. Ewing Properties has collaborated with city and other local officials and residents from the beginning to ensure that the development encompasses the most desirable and successful offerings.

READ ALSO: These Cities Are Tops for STEM Job Growth

Architecture firm Skidmore, Owings & Merrill is on the project team to spearhead the design of the community, which will feature ample residential, restaurant and retail offerings, as well as an office component, all with a focus on walkability and transportation equity.

“We are currently going through the metro planning process, which will ultimately dictate timelines. However, our plan is for the Riverside to be constructed in stages over time to best accommodate city growth and local needs and tenant requirements, which will be market-driven,” Tony Ewing of Ewing Properties told Commercial Property Executive.

In addition to the traditional elements, the Riverside, a community-centric project, will offer multi-layered public spaces totaling more than 25 acres. Ewing Properties will capitalize on the land’s unique topography and ecology to create three distinct public parks. Summit Park, Ravine Park and River Terraces will each allow for specific activities, including concerts, festivals, use of wooded trails, outdoor dining and boating activities.

Rolling out the welcome mat

Ewing Properties envisions the Riverside as a new waterfront gateway to Nashville and expects it to serve as a magnet not just for current residents, but for new residents—and businesses. With the project in the earliest stages, however, the company has not made any decisions on office square footage just yet.

“Through the [standard permit] process, we are looking for flexibility that the market will dictate,” Ewing said. “Working with Councilwoman [Kyonzté] Toombs, we know that she and her district are looking for rooftops; they’re looking for a ‘live, work and play’ development, which this SP will provide.”

Nashville’s office sector remains in recovery mode. Leasing activity continues to rebound from pandemic lows, with year-to-date activity surpassing totals seen during the global financial crisis and early 2000s, according to a third quarter report by Avison Young. With more than 750,000 square feet of leasing activity in the third quarter, cumulative activity for the year reached 3.3 million square feet. And Nashville recorded positive net absorption during the third quarter with help from high tenant demand for Class A space in the urban core.

The fourth quarter is looking promising as well. In October, Southwest Value Partners, developer of the $1 billion Nashville Yards mixed-use project, secured a lease with a law firm for 180,000 square feet at the project’s first multi-tenant office tower.

“As always, in real estate development, developers need to be flexible enough and their business decisions should be market-driven,” Ewing noted. As for courting companies to relocate or expand at the Riverside, he said that job will be a team effort. “We won’t do it alone. The quality of our development, led by Ewing Properties and Skidmore, Owings & Merrill, and the attraction of the great City of Nashville will cause that to happen.”

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725 Ponce. Image courtesy of Cousins Properties

Cousins Properties has added two properties to its Sun Belt portfolio, while also divesting an older asset. The company acquired a fully leased office property in Atlanta, entered into a joint venture to develop a mixed-use project in Nashville, Tenn., and sold an office tower in Charlotte, N.C., that was built in 1974.

READ ALSO: Hudson Pacific, Blackstone Launch Big Studio Project

Colin Connolly, president & CEO of Cousins Properties, said in prepared remarks that the company had Nashville as a target for expansion as the market fit into its Sun Belt strategy. According to Cousins’ investor presentation in July, these three transactions would make for Cousins’ entry into Nashville with a path for growth, keep its portfolio relevant and modern, and decrease the portfolio’s lease-up risk and capex requirements.

In Atlanta, Cousins acquired 725 Ponce, a 372,000-square-foot office tower, from New City LLC and its institutional partner for $300.2 million. The office was completed in late 2019 and is currently fully occupied by tenants including BlackRock, McKinsey & Co. and Chick-fil-A. The Cousins’ presentation also showed that 725 Ponce had a weighted average lease term of 12 years. The company additionally spent $4 million for a 50 percent ownership of an adjacent site that can accommodate from 150,000 to 200,000 square feet of development.

In Nashville, Cousins entered into a joint venture with a large institutional investor to develop Neuhoff, a mixed-use project in the Germantown neighborhood. The project’s first phase includes 388,000 square feet of office space, 60,000 square feet of retail space and 542 multifamily units. Cousins’ $275 million investment secured a 50 percent ownership in Neuhoff’s first and second phases. The joint venture tapped New City Properties to serve as the development manager for the project, which has an expected initial delivery beginning in the fourth quarter of 2022.

Rearranging the Sun Belt portfolio

To improve the quality of its portfolio, Cousins also sold One South at the Plaza, its 40-story Class A office building in Charlotte. The company sold the office property to Monarch Alternative Capital LP for $271.5 million. The 891,000-square-foot tower was built in 1974 and saw a full building renovation in 2019. Cousins acquired One South at the Plaza in its merger with TIER REIT in 2019 but the property has since fallen to 58 percent occupancy, after Bank of America’s lease expired in December 2020. According to Cousins, the sale of the office tower doesn’t include the adjacent College Street parking deck that was recently acquired.

Connolly said in prepared remarks that the transactions allow Cousins to recycle capital from an older capex-intensive property into more modern assets. Following the sale of the Charlotte office tower, 10 percent of Cousins’ portfolio continues to be located in Charlotte. However, the majority of the company’s portfolio remains in Austin, Texas, and Atlanta at 31 and 35 percent, respectively.

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Nashville Yards. Image courtesy of Southwest Value Partners

There’s been a change to the entertainment portion of the program at the $1 billion Nashville Yards, the biggest development in Nashville history at a projected 5 million square feet.

Four years after Southwest Value Partners, owner and developer of the mixed-use destination, announced that Anschutz Entertainment Group would spearhead the entertainment district, the two companies have formed a joint venture to co-develop the entertainment segment of the sprawling 18-acre campus in downtown Nashville. Furthermore, the joint venture partners have reinvented the original concept for the district.

READ ALSO: It’s Time for Borrowers and Sellers to Consider the Land Lease

Neither SWVP nor AEG has disclosed the particulars of the ownership of the new partnership, including whether there has been any change in the ownership of the approximately 4 acres at Nashville Yards that AEG acquired as part of the original 2017 agreement. According to Davidson County records, AEG paid Uptown Property Holdings LLC, an entity of SWVP, $44 million for the site at 910 Commerce St. in March 2018.

The partners have, however, shared news of their new and expanded vision for the entertainment complex and concert venue. In 2017, AEG announced plans for a 4,000-capacity music venue, a theatre complex, a 700-capacity live entertainment club, a 240-key hotel and a variety of food & beverage offerings. Fast-forward four years and SWVP and AEG have masterminded a 24/7 entertainment enclave.

Nashville Yards Entertainment District. Image courtesy of Southwest Value Partners

SWVP and AEG plan to maintain a 4,000-capacity, state-of-the-art live music venue as the centerpiece, along with an upscale eight-screen cinema and a heightened focus on a curated collection of food & beverage options and shopping accommodations. The entertainment complex will also feature 275,000 square feet of premier creative office space, as well as three highly amenitized residential towers and ample open space.

The announcement of the joint venture came with even more news. AEG’s live-entertainment division, AEG Presents, has inked a long-term lease transaction with the new joint venture to operate the music venue at the entertainment district. SWVP had tapped CBRE to serve as property manager for Nashville Yards in July 2020. Additionally, SWVP revealed that it has purchased the ownership interest that was previously held by MGM Resorts.

Nashville’s needs

At full buildout, Nashville Yards will feature approximately 3.5 million square feet of creative office space, including the home of Amazon Nashville and the 650,000-square-foot multi-tenant office tower that will become the headquarters of Pinnacle Financial Partners, more than 1,000 residential units, 400,000 square feet of retail and entertainment offerings and 1,100 hotel guestrooms, including those in the 591-key Grand Hyatt Nashville, which opened in fall 2020.

Nashville Yards is in its infancy and Nashville is making its way back from the pandemic. As noted in a report by Avison Young, Nashville ranked no. 8 in the 2021 Milken Institute Best-Performing Cities Index, which tracks the economic performance of 400 U.S. metropolitan areas, buoyed by its positively trending year-over-year job growth, five-year wage growth and high-tech GDP growth. Construction activity at the Nashville Yards entertainment district is on track to commence in early 2022.

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Pinnacle Building, Nashville Yards. Image courtesy of Southwest Value Partners

Pinnacle Financial Partners is upgrading to a brand-new building in its hometown of Nashville. The company will relocate its headquarters to 95,000 square feet in a planned office tower at Nashville Yards, Southwest Value Partners’ $1 billion, 5 million-square-foot, mixed-use development downtown.

READ ALSO: Office Tenants Embrace Hybrid Work Era

“We are a rapidly growing company and are moving into a new building that can better accommodate our workforce and our plans for future growth,” Rob McCabe, chairman, Pinnacle Financial Partners, told Commercial Property Executive. “Nashville Yards is an exciting new development that is helping revitalize and expand downtown Nashville’s business district. We are Nashville’s bank and a downtown company, so that is where we want and need to be.”

Pinnacle Building, Nashville Yards. Image courtesy of Southwest Value Partners

Pinnacle will be leaving its current home of more than a decade, The Pinnacle at Symphony Place at 150 Third Ave. in the SoBro neighborhood, where the company occupies 90,000 square feet. Pinnacle’s name will soon grace that of Nashville Yards’ first multi-tenant office tower, a 650,000-square-foot building less than a mile away with the address of 201 Platform South. A trapezoid-shaped structure, the new office property will feature such extras as 28,000 square feet of retail space and boast the recently completed Grand Hyatt Nashville and Amazon’s two office buildings as neighbors within the 18-acre mixed-use destination. The 34-story high-rise will also hold the distinction of hosting the highest occupiable floor in the City of Nashville.

Pinnacle’s footprint at Nashville Yards will extend beyond its position as an anchor tenant with its name in lights. The company will also lease 10,000 square feet of retail space for its branch office. Additionally, Pinnacle will launch its new all-digital office concept within Amazon’s two neighboring office towers.

Name(s) on the tenant roster

Pinnacle Building, Nashville Yards. Image courtesy of Southwest Value Partners

Pinnacle may not be the only company to make an early commitment to Nashville Yards’ 201 Platform for very long. While Nashville suffered the same pandemic-related downturn as other office markets across the U.S., the city is rebounding. Office leasing momentum has gone on the upswing quarter-over-quarter, particularly downtown, where positive net absorption totaled approximately 334,000 square feet in the first quarter of 2021, according to a report by CBRE.

“As companies continue to consider expanding or relocating into Nashville, leasing and investment activity should continue to trend positively over the coming quarters,” according to the CBRE report. “As market conditions continue to improve and more occupiers solidify their workplace strategies, pent-up demand should help absorb new and existing office supply.” Southwest Value is on schedule to break ground on Nashville Yards’ 201 Platform in the fourth quarter of 2021.

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UBS Tower. Rendering courtesy of Shorenstein Properties

UBS has signed a renewal of its lease at UBS Tower in Nashville, Tenn. The owner, Shorenstein Properties agreed to a 138,000-square-foot deal, which is set to expire in 2034.

Shorenstein acquired the 600,000-square-foot property in March 2019 out of its Fund Twelve. Wells Fargo provided $103.1 million in acquisition financing to the buyer. Shorenstein is set to upgrade and modernize the 29-story building, and planned amenities include a new fitness center, conference center and tenant lounge. The owner will also improve the lobby and the exterior. The lobby construction is expected to be completed in the third quarter of this year.

Shorenstein’s current portfolio totals 21.3 million square feet in 16 markets, with a gross value of $7.1 billion. In March, the firm sold a pair of Class A office buildings in Miami. The assets traded for $230 million.

Located at 315 Deaderick St., UBS Tower is within walking distance of the State Capitol. Nashville International Airport is 8 miles from the property.

Robby Davis from Cushman & Wakefield represented Shorenstein in the transaction, while Patrick Murphy from the same brokerage assisted the tenant. Recently, Cushman & Wakefield represented the tenant in a lease deal at a 410,114-square-foot office building in Long Beach, Calif.

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Fifth + Broadway. Image courtesy of Skanska USA

Nearly four years after breaking ground on the $450 million Fifth + Broadway—the largest single-phase, mixed-use project ever undertaken in Nashville, Tenn.,—Skanska USA has completed its work as general contractor at the 6.2-acre site in the city’s downtown.

READ ALSO: Top 10 Office Deliveries of 2020

In 2014, Skanska joined the project, located on the site of the former Nashville Convention Center, as it was in the planning phase with developers Brookfield Properties and OM-SE, a joint venture of OliverMcMillan and Spectrum | Emery Properties. The development was designed by Gresham Smith and Gensler.

Working on all components simultaneously, Skanska has now delivered The Place at Fifth + Broadway, a 415-foot, 386-unit apartment tower—the tallest multifamily rental property in Nashville—as well as 501 Commerce, a 24-story office tower with 372,000-square feet of Class A office space that will be the future headquarters of investment management firm AllianceBernstein; approximately 200,000 square feet of retail and entertainment space and the recently opened 56,000-square-foot National Museum of African American Music. The work included building multiple parking garages, with more than 2,000 spaces as well as renovating and expanding conference facilities.

Brookfield has recently announced that the retail component of the development will open on March 4, including the North Hall eateries, part of the Assembly Food Hall. In late spring, the South Hall eateries are expected to open along with a rooftop concert venue and full-service concept by Front Burner Society. Among the restaurants opening in March are Cava, Hattie B’s Hot Chicken, Slim & Husky’s, Shake Shack, Eddie V’s, The Twelve Thirty Club, Blanco Tacos + Tequila, Le Macaron and Boqueria. Retailers opening their doors soon include Nash Collection, Ray-Ban, Free People, Veseo Swimwear and Lingerie, Tecovas, Sephora and The Studio 208.

‘Largest Project’

Fifth + Broadway was Skanska’s largest project in the state of Tennessee, where it has operated for more than 40 years. The firm used 7,000 workers, including 105 prime subcontractors and 61 small, minority-owned, women-owned and veteran subcontractors. Burgin Dossett, vice president, development at Brookfield Properties, said in a prepared statement that Skanska proved to be a strong partner in bringing the project to life. Calling Fifth + Broadway, a “truly transformational” project, Dossett noted the development process required demolition of an existing convention center and, within a single phase, the simultaneous transformation of an entire city block into a mixed-use destination.

Construction began in April 2017 with demolition of the Nashville Convention Center, a late-1980s building that became obsolete with the 2013 opening of the Music City Center. In March 2018, Skanska extended its contract with OM-SE as general contractor of the project. At that time, the development was beginning to take shape. Skanska and Brookfield Properties announced the topping out of the 34-story luxury apartment tower, The Place at Fifth + Broadway, in August 2019. The building, which has 17,000 square feet of amenities including a swimming pool, a recording studio, fitness facilities and multiple lounge and coworking spaces, was completed in the fall along with the office tower.

The post Skanska Delivers $450M Nashville Landmark appeared first on Commercial Property Executive.

Project Pearl. Rendering courtesy of Hillwood

Amazon has announced plans to open a 634,812-square-foot fulfillment center in Alcoa, Tenn. Dubbed Project Pearl, the development will break ground in 2022 and lead to the creation of an estimated 800 new jobs. Hillwood will be the developer for the Ware Malcomb-designed project.

The asset will be Amazon’s eighth fulfillment center in the state and the third to harness robotics technology. The property be used for the picking, packing and shipment of smaller customer items, from books and electronics to consumer goods. The company’s existing Tennessee footprint includes fulfillment and sortation centers in Charleston, Chattanooga, Lebanon, Memphis, Murfreesboro and Nashville, while plans for an 855,000-square-foot Mt. Juliet facility were unveiled last July.

READ ALSO: Industrial Real Estate Clear Leader in Moody’s Report

Tennessee Department of Economic and Community Development Commissioner Bob Rolfe pegged Amazon’s overall investment in the state at approximately $1.5 billion, creating 25,000 jobs. The past year’s announcements alone could generate 3,000 new jobs, Governor Bill Lee projected.

While other real estate sectors have faced challenges in the past year, the industrial sector has flourished. CommercialEdge’s latest industrial report shows that 228.4 million square feet of industrial space was delivered at a national level last year, the largest number to be recorded this century.  

The post Amazon to Open 8th Tennessee Fulfillment Center appeared first on Commercial Property Executive.

1222 Demonbreun. Image courtesy of Endeavor Real Estate Group and Granite Properties

Endeavor Real Estate Group and Granite Properties have completed the 1222 Demonbreun at Gulch Union office tower in Nashville, and have already secured five tenants for the property.

READ ALSO: Office-Using Employment to Lead Demand: Newmark

The joint venture of Endeavor and Granite broke ground on 1222 Demonbreun in August 2018, tapping Turner Construction Co. to build the office tower. The project team also comprises architecture firm HKS, as well as Cushman & Wakefield as leasing agents.

The 20-story building occupies a full block at 1222 Demonbreun St. and includes 330,000 square feet of Class AA office space, as well as 6,000 square feet of retail. The office portion features typical floorplate sizes of approximately 30,000 square feet, with minimal columns and full-height glass windows. The building’s amenities include a fitness center with lockers and showers, a 48-seat training room, a sky lounge, a catering kitchen, destination dispatch elevators, a small market with snacks and meals, a parking garage and on-site property management and security. The office space was also built with high-tech air quality systems equipped with MERV 13 filters.

The office portion has already attracted several tenants mainly in professional services and finance, including RSM Accounting, Insight Global, Dixon Hughes Goodman and Cahaba Wealth Advisors. Biopharmaceutical company Revance has also relocated its headquarters to 1222 Demonbreun. Jamil Alam, managing principal of Endeavor, told Commercial Property Executive that the office component is approximately 30 percent occupied. Alam also said in prepared remarks that Nashville’s low cost of doing business, highly educated workforce and quality of life are continuing to appeal to employers looking to leave higher cost gateway markets.

Live-work-play in the Gulch

The completion of 1222 Demonbreun marks the first phase of the Gulch Union mixed-use development. Endeavor and Granite’s project will also include a boutique hotel, luxury residential tower, retail and restaurants that will all be connected by a podium with a rooftop amenity deck.

Alam told CPE that the second phase will focus on the residential portion of the project and is expected to start construction late in the second quarter or early in the third quarter of 2021. Alam added that the third phase’s timeline has not yet been determined.

The post Endeavor Real Estate, Granite Properties Complete Nashville Tower appeared first on Commercial Property Executive.

Park 840 East 1009. Image courtesy of Duke Realty Corp.

Starbucks Corp. will stay put in its approximately 680,200-square-foot suburban Nashville logistics facility in Lebanon, Tenn., courtesy of a lease renewal with landlord Duke Realty Corp. The global coffeehouse chain and beverage retailer will continue to occupy Park 840 East 1009 in its entirety.  

READ ALSO: Top 20 Commercial Property Owners of 2020

Located at 1009 Hixson Blvd. roughly 20 miles east of downtown Nashville, Park 840 East 1009 sits within Duke’s 158-acre Park 840 East Logistics Center and serves as a distribution gateway to the Southern U.S. Duke developed the facility, which includes roughly 13,800 square feet of office space, in 2013 upon Starbucks’ signing of a 7.5 -year prelease.

“For companies like Starbucks, looking for large distribution space, there are few options in the Nashville market available for immediate occupancy,” Jeff Palmquist, vice president of leasing and development for Duke Realty Corp. in Nashville, told Commercial Property Executive. “This lease renewal allowed the company to remain in the market and maintain its current logistics positioning without skipping a beat or added risk.” Cushman & Wakefield’s Lonnie Russell acted as the listing agent for Park 840 East 1009 and Laura Hart of CBRE represented Starbucks in the lease transaction.

Full house in Nashville

Duke, the only pure-play logistics REIT in the U.S., has a vast footprint in metropolitan Nashville, where its portfolio of owned and managed industrial assets spans 3.6 million square feet and boasts an occupancy level exceeding 99 percent. Most recently, Duke topped off the tenant roster at Park 840 West 14840, located across Interstate 840 from Park 840 East 1009, with an approximately 207,500-square-foot lease with technology company Optoro Inc.

“Nashville is a highly desirable market with proximity to three major thoroughfares that make it an ideal gateway to the Midwest, the West and the South for companies looking to expand their logistics capabilities,” Palmquist said. “However, demand for large industrial space is currently greater than supply, as is evident by our occupancy rate.”

As noted in a report by Cushman & Wakefield, even with pandemic-related shutdowns across the country, there has been very little disruption in Nashville’s industrial market, which recorded more than 1.6 million square feet of leasing activity in the third quarter of 2020 for a year-over-year increase of 3.3 percent. For Duke’s part, Palmquist added, the REIT “will continue to monitor the market and remain vigilant for investment opportunities.”

The post Starbucks Renews 680 KSF Logistics Lease in Nashville appeared first on Commercial Property Executive.

Grand Hyatt Nashville. Image courtesy of Southwest Value Partners

Nashville’s commercial real estate sector experienced several landmark moves in October, with construction and transaction activity taking center stage. Industrial assets attracted the most capital, but one notable deal also closed in the office sector. Although the city’s hospitality and entertainment industry continues to struggle, some developments remained on track, while others were on the fence. Even as a major hotel delivered at Nashville Yards, AEG’s neighboring mixed-use project hit the brakes. Read our October selection of Nashville must-knows:

1. DEVELOPMENT – General Motors to invest $2 billion in Spring Hill plant.

The company announced the capital improvements at the property in preparation for the production of electric vehicles. The car manufacturer will expand the facility’s paint and body shops and invest in new machinery, conveyor belts, controls and tools. The plant will be the company’s third location to manufacture electric vehicles. In addition to its shift toward assembling fully electric cars, traditional vehicles will continue production on-site.

2. DEAL – Northwood Investors pays $200 million for Franklin Park.

JPMorgan Asset Management sold the two office buildings totaling 550,881 square feet in Cool Springs, according to Nashville Business Journal. The two assets previously changed hands in 2018, when Hall Emery sold them for $38.5 million, Yardi Matrix data shows. The entire site is 71 acres and there is room for future development. Located at 6100 and 6700 Tower Circle, the 10-story buildings came online in 2014 and 2017.

3. DEVELOPMENT – Nashville Yards Hyatt opens doors.

Developer Southwest Value Partners and general contractors Clark Construction Group and Bell & Associates Construction debuted the 591-key Grand Hyatt Nashville hotel at 1000 Broadway. The companies broke ground on the project in January 2018. The 25-story building has 77,000 square feet of event space, including a 20,000-square-foot ballroom. Amenities include a rooftop lounge and a wellness center on the fifth floor, which features a gym, swimming pool and spa.

4. DEAL – Stockbridge Capital Group acquires 564,404-square-foot warehouse.

The company purchased Airport Business Park’s Building 3 in Smyrna from Hillwood. The buyer financed the purchase through a $450.2 million portfolio loan from Prudential Financial. The senior note also encumbers 16 other industrial properties totaling 9.3 million square feet nationwide, according to Yardi Matrix data. Located on 41 acres at 423 Liberator Lane, the single-story facility was completed in 2018 and has two grade-level and 23 dock-high doors.

5. DEVELOPMENT – Hilton-branded hotel coming to Nashville International Airport.

Chartwell Hospitality is on track to build a 14-story property adjacent to the airport’s future central terminal. The estimated cost for the 292-key hotel is $95 million, and the Metropolitan Nashville Airport Authority will invest an additional $82 million to develop an adjacent parking garage and plaza. Amenities will include a fitness center, open-air swimming pool and bar on the rooftop along with 16,500 square feet of event space.

6. DEAL – TPG buys northeast Nashville industrial facility.

The company purchased the asset through its logistics platform, Dogwood Industrial Properties. N&N Moving Supplies sold the two warehouses encompassing 133,186 square feet in Old Hickory. The buildings previously traded in April 2019, when Dealers Warehouse sold it for $4.1 million. Developed in several phases between 1982 and 1998, the structures are on an 8-acre site at 931 Robinson Road.

The post Nashville Commercial Real Estate Wrap-Up – October 2020 appeared first on Commercial Property Executive.

931 Robinson Road

Regional moving supply distributor N&N Moving Supplies has sold a two-building, 133,186-square-foot industrial asset near Nashville, Tenn., to TPG for $7.2 million, according to public records. The buyer acquired the property through its industrial platform, Dogwood Industrial Properties.

The seller had acquired the property in Old Hickory, Tenn., for $4.1 million in April 2019, Yardi Matrix data shows. N&N occupies the full property, which includes a 112,610-square-foot and a 20,576-square-foot building on a 7.9-acre parcel at 931 Robinson Road.

The property, built in phases between 1982 and 1998, is located near one of the Cumberland River’s bends, 12 miles north of Nashville International Airport. The surrounding area has a number of small- and mid-sized industrial properties and is also home to a nearly 1 million-square-foot plastic manufacturing facility, owned and occupied by Berry Global.

In addition to its industrial holdings, TPG owns more than 8 million square feet of office space across the country, according to Yardi Matrix. In April, the investor paid more than $60 million for four office assets totaling nearly 450,000 square feet in Durham, N.C.

The post TPG Buys Northeast Nashville Industrial Property appeared first on Commercial Property Executive.

Airport Logistics Park. Image courtesy of Cushman & Wakefield

Although the number of new COVID-19 cases in September kept pace with August, Tennessee authorities started allowing more businesses to reopen. In late September, the governor lifted restrictions on gathering sizes in most counties and said that safety measures, such as mask requirements and the isolation of symptomatic cases, would continue through October. Nashville’s commercial real estate remained somewhat active, with deals closing in a variety of asset classes. Developments also moved forward, particularly in the office and hospitality sectors. Catch up on our September selection of Nashville must-knows:

1. DEAL – Hines sells open-air shopping center for $141.3 million.

The Avenue Murfreesboro is an 843,248-square-foot property located on 96.3 acres at 2615 Medical Center Parkway in Murfreesboro. Equity Street Capital partnered with Big V Property Group to acquire the asset. The center last changed hands in the summer of 2013, when Hines bought the property for $163 million from Cousins Properties and Faison Enterprises. The Avenue has six multi-tenant structures, eight outparcels and five parcels for future development. The asset’s largest tenants include Belk, World Market, Barnes & Noble and Old Navy.

2. DEAL – Stoltz Real Estate acquires office asset for $34 million.

Loews Corp. completed the disposition of Loews Vanderbilt Office Plaza, a 168,531-square-foot property. Located on 4 acres at 2100 West End Ave., the property was completed in 1984 and renovated in 2016. The 12-story building is attached to the 339-key Loews Vanderbilt Hotel and has a retail component and three passenger elevators along with structured parking. Both components last changed hands in 1989, when Travelers Insurance sold it for $28.7 million.

3. DEAL – Holladay Properties sells six-building industrial portfolio for $62.3 million.

Starwood Capital Group acquired the first two phases of Airport Logistics Park. The company funded the 397,981-square-foot purchase with a $35 million loan from MetLife. The seller, which also developed the industrial complex, is working on the property’s third phase, which will add five buildings encompassing 328,500 square feet to the park. The first of the facilities is scheduled for completion in 2021. Located near Nashville International Airport at 1922 Old Murfreesboro Pike, the existing buildings delivered in 2019.

4. M&A – Colliers strengthens Nashville presence.

The company acquired Colliers International Nashville LLC, a former affiliate in the metro. The value of the deal wasn’t disclosed, though Colliers Nashville shareholders will benefit from Colliers’ partnership model, which will allow them to maintain equity. With a team of 70 seasoned professionals and a leasing and management portfolio of more than 7 million square feet, the former affiliate is one of the largest commercial real estate firms in central Tennessee.

5. FINANCING – Panattoni Development takes $23 million Music Row project loan.

According to Yardi Matrix, Pinnacle Financial Partners provided the financing. The 108,522-square-foot office development is set to include bike locker, locker rooms and a parking ratio of 3 spaces per 1,000 square feet. Located within an Opportunity Zone at 1030 16th Ave. S., the site is within 2 miles of downtown Nashville. Completion is scheduled for early 2022.

6. DEVELOPMENT – Fairfield Inn & Suites opens near Centennial Park.

The $35 million, 155-key hotel is owned by a partnership of Kana Hotel Group, a private hotelier and two local real estate brokers. According to Nashville Business Journal, the group started the development in 2015. Common-area amenities include a swimming pool, laundry facility and fitness center. Located at 109 29th Ave. N., the property is within 2 miles of downtown Nashville.

The post Nashville Commercial Real Estate Wrap-Up – September 2020 appeared first on Commercial Property Executive.

READ ALSO: Hotel Sellers Meet Investors With Vision

Located at 1000 Broadway in downtown Nashville, the 784,000-square-foot hotel reaches 25 stories and offers 77,000 square feet of event and function space, including a 20,000-square-foot grand ballroom. The hotel features The Continental restaurant, a rooftop lounge and a fifth-floor wellness center that encompasses a fitness center, pool and spa.  

Clark Construction and Bell & Associates began construction on the Grand Hyatt in January 2018. The development efforts included the contribution of more than 3,500 workers and reached a peak of 515 workers on site. With the Grand Hyatt Nashville opening amidst the COVID-19 pandemic, the hotel has implemented several health protocols including frequent cleanings of common areas and guestrooms, contactless room service and the requirement of masks and social distancing.

Prior to the work on the Grand Hyatt, Clark Construction had previous experience in Nashville through two other major projects. In 2013, the developer completed the 2.1 million-square-foot Music City Center that’s adjacent to the city’s Country Music Hall of Fame and the Bridgestone Arena. Later in 2017, Clark Construction also delivered the 240,000-square-foot Engineering and Science Building at Vanderbilt University that includes laboratories, offices, and three levels of shell space for future expansion.

Next up in Nashville Yards

The opening of the Grand Hyatt Nashville marks the first completed project of the 18-acre mixed-use Nashville Yards development. The massive project, which was designed by Gresham, Smith and Partners, will include at least 3.5 million square feet of office space, 1,000 residential units, 400,000 square feet of retail and entertainment space and 1,100 keys in several hotels.

Southwest is also working with Clark and Bell to develop Parcel 4 of Nashville Yards, which will be home to Amazon’s Operations Center of Excellence. Southwest also secured a $175.5 million construction loan for the development of Amazon’s Nashville offices in August 2019. The first tower of Amazon’s center was topped off earlier this summer and is expected to open in 2021.

The post Southwest Value Partners Debuts Grand Hyatt Nashville appeared first on Commercial Property Executive.

Loews Vanderbilt Office Plaza

Loews Corp. has completed the $34 million disposition of Loews Vanderbilt Office Plaza, a 168,531-square-foot office property in Nashville, Tenn. Stoltz Real Estate Partners acquired the asset, according to Davidson County Records.

The property is one component of a larger, 670,859-square-foot structure which includes the 339-key Loews Vanderbilt Hotel and a multi-level parking structure. The entire building previously changed hands in 1989, when Travelers Insurance Co. sold it for $28.7 million, public records show.

Located on 4 acres at 2100 West End Ave., the 12-story property was completed in 1984 and renovated in 2016. The building has a retail component and three passenger elevators. The tenant mix includes Vanderbilt University, Paycom and Stonebridge Wealth Management.

Situated in Midtown, the building is a short distance from Vanderbilt University’s main campus and 2 miles from the city center. Nashville International Airport is 9 miles east of the property.

Last year, Stoltz Real Estate Partners completed the $22.5 million disposition of Spring Forest Business Center, a three-building, 155,000-square-foot business park in Raleigh, N.C. Founders Properties acquired the assets, backed by a $14.5 million loan from The Woodmen of the World Life Insurance Society.

The post Loews Sells Nashville Office Asset for $34M appeared first on Commercial Property Executive.

3450 Glenside Court. Image courtesy of JLL

Reliant Real Estate Management has completed the acquisition of a two-property self storage portfolio encompassing 1,200 units in Murfreesboro, Tenn. Wasatch Storage Partners sold the facilities for $14.8 million, according to Rutherford County records. The new owner financed the purchase with a $12 million loan from National Western Life Insurance Co.

The larger of the two assets is Salem Glen Self Storage, a 662-unit property spanning 88,918 square feet at 3450 Glenside Court. The facility opened its doors in 2005, with an additional phase completed in 2017. The store provides 177 climate-controlled and 485 non-climate-controlled units with drive-up access.

The second facility is a CubeSmart-managed property totaling 538 units spread across 50,183 square feet. The location encompasses seven buildings completed in 2017. This past spring, the seller added 57 RV parking spaces to the 244 climate-controlled and 237 non-climate-controlled units with drive-up access.

Situated within 1 mile of each other, the facilities are within 36 miles southeast of downtown Nashville. Additionally, there are at least four other self storage properties totaling 360,450 square feet within a 3-mile radius.

The JLL Capital Markets team which assisted the seller included Managing Directors Steve Mellon and Brian Somoza and Executive Vice President Bo Fulk. In July, Somoza and Mellon assisted SurePoint Self Storage in the disposition of a 1,692-unit portfolio encompassing 258,000 square feet in the Kansas City metro.

The post Wasatch Storage Partners Sells Nashville-Area Portfolio appeared first on Commercial Property Executive.

Airport Logistics Park. Image courtesy of Cushman & Wakefield

Starwood Capital Group has completed its $62.3 million acquisition of the first two phases of Airport Logistics Park in Nashville, Tenn. The company funded the 397,981-square-foot industrial purchase with a $35 million loan from MetLife, according to Davidson County records. Holladay Properties sold the six-building distribution portfolio.

The seller, which also developed the industrial complex, is working on the property’s third phase, which will add five buildings encompassing 328,500 square feet to the park. The first of the facilities is scheduled for completion in 2021. Upon full build-out, the 95-acre project will comprise 11 buildings totaling more than 700,000 square feet.

Located near Nashville International Airport at 1922 Old Murfreesboro Pike, the existing buildings delivered in 2019. The six warehouses are fully leased to 14 tenants, including DHL, Overhead Door and BrandSafway. The park is 4 miles from Interstate 40 and 10 miles southeast of the city center.

Cushman & Wakefield negotiated on behalf of the seller. The team included Vice Chairman Stewart Calhoun, Director Casey Masters, Executive Managing Director David McGahren and Executive Director Ronnie Wenzler.

Last year, Starwood paid $319.6 million for a 95 percent stake in a 33-property industrial portfolio across the Midwest. Becknell Industrial sold the assets which encompass 4.1 million square feet.

The post Starwood Pays $62M for Nashville Airport Warehouses appeared first on Commercial Property Executive.

The Joseph Nashville. Image courtesy of The Pizzuti Cos.

While the month began with a high number of new COVID-19 cases in Tennessee, the caseload followed a downward trajectory through the rest of August. As a result, local authorities in Nashville moved to ease some restrictions from its modified second phase of reopening. The metro’s commercial real estate sectors kept relatively active as companies continued to buy or lease space, particularly in industrial assets. Developments also moved forward, with some new projects in Nashville’s construction pipeline targeting the city’s key tech and hospitality industries. Catch up on our August selection of Nashville must-knows:

1. DEVELOPMENT – Facebook kicks off construction on $800 million data center.

The company broke ground on its 13th facility in Gallatin. Designed to meet LEED Gold standards, the property will utilize 80 percent less water than the industry average and will run entirely on renewable energy. The social media giant signed power purchase agreements for 220 megawatts of new solar energy in Tennessee, with plans to contract for more. Facebook acquired several land parcels for $20 million and consolidated them into the 809-acre project site.

2. DEAL – JV sells fully leased Wilson County warehouse.

Westmount Realty Capital purchased a 709,652-square-foot Class A industrial property for $30.9 million. A partnership between Fortress Investment Group and Sansone Group sold the building. The asset last traded for $23.6 million in 2019, when the seller acquired it from Wells Fargo, according to Yardi Matrix. The distribution center occupies 44 acres at 245 Couchville Industrial Blvd. in Mt. Juliet. The building is home to Electrolux North America and Superior Third Party Logistics.

3. LEASING – Duke Realty brings industrial property to full occupancy.

Tech company Optoro Inc. signed a 207,518-square-foot lease at Park 840 West 14840, a 653,460-square-foot warehouse in Lebanon. JLL Executive Vice President Bo Fulk assisted the tenant, while Cushman & Wakefield Director Lonnie Russel represented the owner. Built in 2006, the building is located on 33 acres at 14840 Central Pike, a short distance from Interstate 840 and 25 miles east of downtown Nashville.

4. DEVELOPMENT – Marriott-branded hotel debuts downtown.

The Pizzuti Cos. opened The Joseph Nashville, a 297-key hotel which is part of Marriott’s Luxury Collection. The building rises 21 stories at 401 Korean Veterans Blvd. in SoBro, close to the Music City Center. The developer acquired the 1-acre site for $7.3 million from the Nashville Symphony in 2018. Centennial Bank originated a five-year, $83.5 million construction loan for the project, public records show.

The post Nashville Commercial Real Estate Wrap-Up – August 2020 appeared first on Commercial Property Executive.

Ryan Kratz, President, Southeast Region at Colliers International. Image courtesy of Colliers International

Colliers International Group Inc. deepens its coverage in Nashville with the acquisition of Colliers International Nashville LLC, a former affiliate of the commercial real estate services giant. Colliers has not divulged the financial specifics of the transaction; however, current Colliers Nashville shareholders will benefit from Colliers’ partnership model, which will allow them to maintain equity in the business.

Colliers Nashville comes to the table with a strong reputation, cultivated since its opening in 1938, as well as a solid foundation for evolution under the Colliers umbrella. “The Colliers Nashville business has a long, successful history of operation, through the best and worst of times,” Ryan Kratz, president, Southeast Region-US Brokerage, told Commercial Property Executive. “The business is time-tested, resilient, and poised for continued growth.” 

LISTEN TO: The Quest for CRE Opportunity

Catering to commercial real estate investors, developers and occupiers alike, Colliers Nashville provides a full suite of offerings that includes landlord and tenant representation, investment sales brokerage, property management and project management services. With a team of 70 seasoned professionals and a leasing and management portfolio of more than 7 million square feet, the firm is one of the largest commercial real estate firms not just in metropolitan Nashville, but in Middle Tennessee as well. And it endeavors to grow even larger—even in the current climate of uncertainty. “The mutual vision between Colliers International and the Nashville operation for the expansion of this business certainly transcends the events of today,” Kratz said. “Best of all, the Nashville business has exceptional employees and brokers who will aid in this continued growth,” he added.

Monitoring Music City

The Nashville office market is taking its hits due to COVID-19, just like most other office markets across the country. Deliveries, new sublease space and companies’ reassessment of space needs have conspired to push the overall average vacancy rate up to 9.8 percent and create negative net absorption totaling 44,400 square feet in the second quarter, according to a report by Colliers.

But, as Kratz noted, Nashville has its own history of resiliency. “Nashville typically enters recessions late in the cycle and exits recessions on the front end of recovery. Today, we continue to see investments flow in and developments launch,” he told CPE. “Investors and users are taking the long view and they see Nashville as one of the most vibrant economies now and into the near-term future.”

Like Colliers Nashville, the City of Nashville has a strong foundation from which to rebound in the post-pandemic world. “Nashville’s economy is diversified, spanning health care, higher education, technology, manufacturing, logistics and, of course, music and entertainment,” Kratz added. And as the city continues to attract educated talent, companies such as UBS, Alliance Bernstein, Amazon and many others are locating offices and facilities there, according to Kratz.

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245 Couchville Industrial Blvd. Image courtesy of JLL

Westmount Realty Capital has paid $30.9 million for a 709,652-square-foot warehouse in Mt. Juliet, Tenn. A partnership between Sansone Group and Fortress Investment Group sold the Class A asset after acquiring it in 2019 for $23.6 million from Wells Fargo Bank, Yardi Matrix data shows.

Located at 245 Couchville Industrial Blvd. within Nashville’s primary bulk distribution submarket, the facility is adjacent Interstate 840, some 26 miles from Nashville International Airport and 33 miles from downtown. The building is leased to two tenants: Electrolux North America Inc. occupies 67 percent of the space, with the remainder leased to Superior Third Party Logistics. The property was completed in 2008 on a 44-acre site and includes 36-foot clear heights, 76 trailer parking spaces, a two-level office build-out component, 134 dock-high loading doors and four grade-level doors.

JLL Managing Directors Britton Burdette, Pete Pittroff and Matt Wirth, together with Senior Vice President Jim Rodrigues and Associates Mitchell Townsend and Perry Wolcott, worked on behalf of the seller. In August, Burdette and Wirth were part of the team responsible for the $43.9 million sale of a Bed Bath & Beyond distribution center in Georgia.

The post Westmount Realty Buys Nashville-Area Warehouse for $31M appeared first on Commercial Property Executive.

The Avenue Murfreesboro. Image courtesy of Equity Street Capital

Hines has sold The Avenue Murfreesboro, an 843,248-square-foot open-air shopping center outside of Nashville, Tenn., to a joint venture between Equity Street Capital and Big V Property Group for $141.3 million. Public records show that the asset last changed hands in the summer of 2013, when Hines bought the property for $163 million from Cousins Properties and Faison Enterprises.

Located on 96.3 acres at 2615 Medical Center Parkway in Murfreesboro, Tenn., The Avenue has six multi-tenant structures, eight outparcels and five parcels for future development. The property’s largest tenants include Belk, World Market, Barnes & Noble and Old Navy.

Situated some 30 miles southeast of downtown Nashville, the shopping center is on the northwestern side of Murfreesboro alongside Interstate 24. Several hospitality properties are on the asset’s northern edge, and Sterling Organization’s 671,000-square-foot Stones River Town Centre—the nearest major shopping mall—is 2 miles southeast.

The retail sector continues to face an uphill battle due to the intersection of the pandemic’s effects with longer-term shifts away from brick-and-mortar demand. Store closings and bankruptcy filings have followed suit: At the end of August, Lord & Taylor became the latest casualty of the downturn.

The post Equity Street Acquires Nashville Shopping Center in $141M Deal appeared first on Commercial Property Executive.

2401 Cherahala Blvd.

Lexington Realty Trust has sold a 59,748-square-foot, single-tenant building in Knoxville, Tenn., leased to CVS Pharmacy. A group of private investors based in Jackson, Miss., acquired the asset for $9.9 million. According to Yardi Matrix data, Lexington purchased the property in 2002, for $8 million.

The tenant has occupied the building since it was built 18 years ago. The property is CVS Caremark’s second largest call center location in the U.S. and, at the time of sale, there were approximately seven years left on the double net lease.

Located at 2401 Cherahala Blvd. on 9.6 acres, the property is 5 miles from Interstate 40. The asset is part of the Pellissippi Corporate Center, which includes tenants such as ADT Security, FedEx, and Oak Ridge National Laboratory, among others. Downtown Knoxville is 15 miles away.

Associate Director Jonathan Ameen and Managing Director Jeff Hughes of Stan Johnson Co., in association with Principal John Adams III of Avison Young, acted on behalf of Lexington. This month, another Stan Johnson team represented the seller of two freestanding big-box Walmart Supercenters in the Midwest. 

The post Knoxville CVS Call Center Trades for $10M appeared first on Commercial Property Executive.

Facebook Gallatin Data Center. Image courtesy of Facebook

Social media addicts may have less reason to stay inside uploading cat pictures as pandemic restrictions ease, but that isn’t slowing Facebook’s drive to build more high-tech homes for its users’ data. The company has just broken ground on a new data center northeast of Nashville, Tenn., that will cost more than $800 million and will run entirely on renewable energy.

The 982,000-square-foot project in Gallatin is the second data center Facebook has unveiled this year, after the company said it had chosen the Chicago suburb of DeKalb, Ill., for a slightly smaller facility at the end of June. The newest project, Facebook’s 13th data center in the U.S., is coming up in the Gallatin Industrial Park, neighboring Beretta USA’s firearms plant, a Gap distribution center and SERVPRO’s corporate headquarters.

READ ALSO: TikTok to Invest $500M in 1st European Data Center

Facebook touted the future server farm’s green credentials in a statement, saying that the LEED Gold-certified campus will use 80 percent less water than the average data center. The company has signed contracts for 220 megawatts of new solar energy in Tennessee to support its operations in the area, with plans to contract for more. The data center will support an estimated 100 jobs once operational, spanning from technical operations and electricians to logistics and security staff.

More homes for the cloud

City and state economic development authorities have sought for years to bring a major data center to Gallatin, a community of more than 40,000 people in Sumner County, about 30 miles northeast of Music City. Facebook earlier this year acquired the 809-acre site for the project for $20 million under the name Woolhawk LLC, according to Gallatin News.

Mark Zuckerberg, CEO, Facebook. Image courtesy of Anthony Quintano via Wikimedia Commons

Facebook now has seven operational data center sites in the U.S., Data Center Knowledge reported, including a project that officially launched in New Albany, Ohio, this past February. The company opened two data centers last year in New Mexico and Nebraska and has announced further sites in Virginia, Georgia, Utah and Alabama.

The Illinois facility announced in June will measure 907,000 square feet upon completion. Facebook will invest $800 million in the cutting-edge property, which will be supported by 100 percent renewable energy. The tech firm also leases data center space from operators such as Digital Realty Trust and Cloud HQ in addition to building its own sites.

Adding office space

Facebook has also been expanding its office footprint, despite an ongoing work-from-home policy that the company has recently extended to July of next year. Just last week, Vornado Realty Trust announced that the company had inked a 730,000-square-foot lease for the entire office portion of a historic post office the REIT is redeveloping in Midtown Manhattan.

The social media giant reported revenue growth of 11 percent year-over-year in the second quarter and has 3.14 billion monthly users of its apps, which include Instagram, Messenger and WhatsApp. Facebook CFO Dave Wehner said the company expects to see user growth to be flat or slightly negative during the third quarter in most regions as shelter-in-place measures continue to be lifted.

The post Facebook Breaks Ground on $800M Tennessee Data Center appeared first on Commercial Property Executive.

Park 840 West 14840. Image courtesy of Duke Realty Corp.

Duke Realty Corp. has signed a lease with Optoro Inc. to take 207,518 square feet at the developer’s Park 840 West 14840 logistics building in Lebanon, Tenn. The technology company will use the Class A location as its flagship returns processing and R&D facility, bringing the 653,460-square-foot property to full occupancy.  

READ ALSO: Build-to-Suits: A Safe Bet for Developers, Investors

The building is located at 14840 Central Pike, east of downtown Nashville and very close to the interchange of I-840 and Hwy. 109/265. It was completed in 2006 and features 32-foot clear height. Lonnie Russell with Cushman & Wakefield was the property’s listing agent and Bo Fulk of JLL represented Optoro in the lease transaction.

Optoro’s OptiTurn software helps retailers manage excess and returned inventory. The company’s clients include Ikea, Staples, Target and Best Buy.

Duke has a similar property less than a mile away as the crow flies. Totaling 680,160 square feet, that building was completed by the company in 2013, according to a Duke spokesperson.  

Stable despite the situation

In a prepared statement, Jeff Palmquist, Duke’s vice president of leasing and development in Nashville, said the lease allowed the company to quickly backfill a recently available space.

Previous Commercial Property Executive coverage indicates that as of 2014 this space was occupied by Nutro Co., a pet food maker and subsidiary of Mars Inc. The majority tenant was at that time, and appears to still be, B&G Foods, a manufacturer and distributor of food and household products. B&G’s brands include SnackWell’s, Cream of Wheat, Polaner, Green Giant, Ortega, Joan of Arc and Emeril’s.

The metro Nashville warehouse/distribution market remains strong despite the pandemic, according to a second-quarter report from JLL. Year-to-date net absorption was nearly 2.2 million square feet (on an inventory of 155 million square feet), and direct asking rents continued to climb, reaching $5.07 per square foot as of the second quarter. A little more than 4.2 million square feet of space was under construction, while total vacancy was only 3.2 percent and trending down, JLL reported.

The post Duke Realty Backfills Metro Nashville Logistics Building appeared first on Commercial Property Executive.

Nashville Yards. Image courtesy of CBRE

With coronavirus cases still up across Tennessee, Nashville remains in a modified Phase 2 of its reopening plan.  Shelby and Davidson counties, which coincide with most of metro Memphis and Nashville, continued to record an accelerating pace of infections, a fact that has also affected real estate activity across good parts of the state. Nonetheless, Nashville has had its share of real estate headlines in July, with Amazon, Nashville Yards and the historic Union Station Hotel leading the way. Here’s our list of commercial real estate must-knows for the past month: 

1. DEVELOPMENT – Amazon unveils plans for Mt. Juliet facility.

Panattoni Development Co. will build the 79-acre, 855,000-square-foot project, with completion scheduled for late 2021. This will be the seventh Amazon fulfillment center in Tennessee, following similar facilities in Charleston, Chattanooga, Lebanon, Murfreesboro, Memphis and Nashville. The center is also slated to become the second in the state to use robots for mapping routes around the warehouse and handling heavy lifting.

2. DEAL – Setzer Properties buys shipping terminal for $17.3 million.

Traditional Bank provided a one-year, $14.6 million loan for the acquisition of the 98,889-square-foot facility. The seller, XPO Logistics, had bought the asset in 2015. The main building of the property has 67,270 square feet of industrial and 12,579 square feet of office space. Situated at 401 Enos Reed Drive, the property is within 5 miles of both downtown and Nashville International Airport. The asset is also less than 1.5 miles from interstates 40 and 24.

3. DEAL – REIT sells historic Union Station Hotel for $56 million.

The buyer, Southwest Value Partners, financed the acquisition through a five-year, $30.3 million loan from International Bank of Commerce. The new owner tapped Dimension Development to manage the property, which is part of the Autograph Collection flag. The seller, Pebblebrook Hotel Trust, had bought the 125-key asset six years ago for $52.3 million and invested $15.5 million in renovations by 2016. Located at 1001 Broadway, the hotel is adjacent to Frist Art Museum and within 1 mile of the state capitol.

4. DEAL – Medical office building changes hands for $33 million.

Saint Thomas Health acquired the 163,539-square-foot property from a Florida-based private investor. The buyer already owned the land and was leasing it to the seller via a ground lease agreement. Located at 2011 Murphy Ave. on 5 acres, the six-story building is adjacent to TriStar Centennial Medical Center and Saint Thomas Midtown Hospital. Downtown Nashville is less than 2 miles from the property.

5. MANAGEMENT – CBRE to manage Nashville Yards.

The 17-acre downtown campus, which is being developed by Southwest Value Partners, is slated to encompass more than 3.5 million square feet of office space, approximately 1,000 multifamily units and 400,000 square feet of retail and entertainment space. The project will include a 20-story, 566,000-square-foot Class A office tower to be occupied by Amazon, which is scheduled for completion in 2021. CBRE’s Associate Director David Cheek will be coordinating management efforts.

The post Nashville Commercial Real Estate Wrap-Up – July 2020 appeared first on Commercial Property Executive.

Belle Meade Office Park

A private investor has taken a $15 million loan from Southern Farm Bureau Life Insurance Co. for Belle Meade Office Park in Nashville, Tenn., public records show. Set to mature in 2027, the financing retires an existing $15 million loan from Truxton Trust Co. for the 124,000-square-foot facility. Yardi Matrix data shows the owner spent $14.7 million to acquire the asset from TA Realty in 2001.   

Located at 4525 Harding Pike, the asset is near two grocery-anchored shopping centers, 5 miles southwest of downtown Nashville. On the northern edge of Belle Meade, Tenn., the property is half a mile from the Saint Thomas West Hospital.

Completed in phases in 1974 and 1984 on a 6.3-acre site, the three-story building includes floor plates ranging from 8,016 to 17,472 square feet and 744 parking spots. The tenant roster includes myriad service-based firms, from medical practices to law offices.

In March, TA Realty closed a $1.2 billion fund. The value-add investment vehicle will target industrial, office, multifamily and grocery-anchored shopping centers in leading markets across the U.S.

The post Southwest Nashville Office Asset Lands $15M Refi appeared first on Commercial Property Executive.

Union Station Hotel Nashville, Autograph Collection. Image courtesy of Union Station Hotel Nashville

Pebblebrook Hotel Trust, a Bethesda, Md.-based hotel REIT, has completed the sale of Union Station Hotel Nashville, Autograph Collection, in Nashville, Tenn., to Southwest Value Partners for $56 million. Combined with the sale of two hotels earlier this year in Atlanta and Washington, D.C., for $331 million, the company has divested a total of $387 million in hotel properties so far this year.

READ ALSO: CMBS 2.0 Hotel, Retail Loans Spur Rise in Delinquencies

The REIT announced on May 27 that it had executed a contract with a third party to sell the 125-key historic hotel. Pebblebrook did not identify the buyer but Southwest Value Partners, the California-based firm that is building the 17-acre, mixed-use Nashville Yards development in downtown Nashville, announced in June that it was acquiring the hotel at 1001 Broadway. Southwest financed the acquisition through a five-year, $30.3 million loan from International Bank of Commerce, according to Davidson County records.

Cary Mack and Mark Schlossberg, co-managing partners of Southwest Value Partners, said in a prepared statement Dimension Development will be managing the hotel. Dimension will also manage the Grand Hyatt Nashville, the 591-key hotel that is set to open soon across the street from Union Station Hotel at Nashville Yards. Mack and Schlossberg cited the history of the Union Station building, a former railroad terminal that had opened in 1900 and became a hotel in 1986. Part of Marriott’s Autograph Collection, the upscale hotel became a member of the Historic Hotels of America in 2015. Pebblebrook bought the hotel in December 2014 for $52.3 million from Turnberry Associates and Corner Partnership and made $15.5 million in renovations by 2016. Mack and Schlossberg stated the hotel would be a “natural and exciting hospitality addition to the broader Nashville Yards vision and master plan.”

The mixed-use campus is slated to have more than 3.5 million square feet of office space, about 1,000 multifamily units and 400,000 square feet of retail and entertainment space. The development will include a 20-story, 566,000-square-foot Class A tower at 1001 Church St. that will be Amazon’s operations center, scheduled for completion in 2021.

Pebblebrook’s plans

Pebblebrook has been continuing to sell hotel properties as part of its disposition program after acquiring LaSalle Hotel Properties in November 2018. In January, the REIT executed a contract to sell the 422-key InterContinental Buckhead Atlanta and the 237-key Sofitel Washington DC for $331 million. Also in the nation’s capital, Pebblebrook sold the 137-key Rouge Hotel located less than 1 mile from the White House and the National Mall in September for $42 million. The company previously sold the 343-key Liaison Washington Capitol Hills for $111 million and the 335-key Hotel Palomar for $141.5 million. Both of those sales also occurred in 2019.

Union Station Hotel Nashville, Autograph Collection. Image courtesy of Union Station Hotel Nashville

In June, Jon Bortz, Pebblebrook chairman, president & CEO, spoke at NAREIT’s REITWeek Virtual Investor Conference, and described the hotel industry as being “devastated” by the COVID-19 crisis. At that time, he noted the hospitality industry has seen about 20 percent of hotels closed and approximately 75 percent of the workforce furloughed. On Thursday, Pebblebrook released its second-quarter 2020 earnings report and stated it could not provide 2020 guidance at this time due to the uncertainties caused by the pandemic. The REIT noted it plans to release new guidance “when it has more clarity on government restrictions, advances in health solutions, the economy, travel demand and more predictable overall operating fundamentals and trends.”

Pebblebrook did note that 24 of its 53 hotels and resorts are now open and expects to reopen five more hotels by mid-August. Bortz stated in the earnings report that the company has seen an uptick in the leisure segment that has benefited its drive-to resorts. He noted they have been experiencing improvements in operating performance each week. Bortz said Pebblebrook is also seeing gradual recovery and demand in its urban hotels. He also noted Pebblebrook has recently completed the redevelopment of Hotel Zena Washington DC and Viceroy Hotel Washington DC in Washington, D.C., and of several properties in California, including Le Parc West Hollywood, San Diego Mission Bay Resort, Chaminade Resort in Santa Cruz and Viceroy Santa Monica Hotel.

The post Pebblebrook Hotel Trust Sells Historic Nashville Property appeared first on Commercial Property Executive.

Image courtesy of Amazon.com Inc.

Amazon has announced plans to open an 855,000-square-foot fulfillment and sortation center on a 79-acre site in Mt. Juliet, Tenn., with completion expected in late 2021. Mt. Juliet is just east of metro Nashville, Tenn., and just north of I-40.

READ ALSO: Amazon Adds El Paso to Fulfillment Center Lineup

The facility will be the seventh Amazon fulfillment and sortation center in Tennessee; others are in Charleston, Chattanooga, Lebanon, Murfreesboro, Memphis and Nashville. The Mt. Juliet facility will also be Amazon’s second fulfillment center in Tennessee to use “innovative robotics technology,” according to the company. More specifically, hundreds of robots will map out the best routes to bring human employees to the inventory, help them take items from shelves, and move stacks of inventory around and handle other heavy lifting, such as stacking boxes on pallets for shipping.

Rendering of Mt. Juliet, Tenn., Amazon facility. Image courtesy of Amazon.com Inc.

Nonetheless, the facility is expected to create more than 1,000 new, full-time jobs, evidently in large part to focus on picking, packing and shipping smaller customer items, such as books, electronics and consumer goods.

The Mt. Juliet center will have increased sanitation protocols and reportedly will accommodate social distancing. No further information was available on this project as of press time.

Resilient so far

The project is being developed by Panattoni Development Co. Inc. In January, Panattoni sold Lear Industrial Center, a 1.4 million-square-foot, four-building business park in Reno, Nev., to Clarion Partners for $117.3 million.

The COVID-19 pandemic doesn’t seem to have stalled Nashville’s warehouse/distribution market, according to a second-quarter report from JLL. Ground was broken on more than 1 million square feet of space in the second quarter, total absorption in the quarter topped 1.3 million square feet, and direct asking rents rose to $5.07, from $4.97 in the first quarter. Overall vacancy was only 3.2 percent, and about 4.2 million square feet of distribution space was under construction, again according to JLL.

The post Amazon to Open 7th Distribution Center in Tennessee appeared first on Commercial Property Executive.

Stor Place Self Storage

The Freeman Group has taken a $6.2 million loan for Stor Place Self Storage, a facility with 55,263 square feet of net-rentable space in Nashville, Tenn. First Farmers and Merchants Bank provided the refinancing package, according to Davidson County records.

The note retires $11.8 million in existing debt. Synovus Bank provided the previous mortgage in 2014 which encumbered four other self storage assets in the market, Yardi Matrix shows. 

Located on 2 acres at 1615 Charlotte Ave., Stor Place encompasses five buildings completed in 1995. The facility has indoor, drive-up access and climate-controlled units ranging from 25 to 450 square feet. The property has an on-site manager, security cameras and both auto and RV parking.

Situated less than 1 mile southwest of downtown Nashville, Stor Place Self Storage is close to Interstate 40. There are at least 13 self storage facilities within a 3-mile radius, according to Yardi Matrix data.

In June, the self storage sector saw fewer markets with rent decreases compared to prior months, which could signal that the industry may have already experienced the worst fallout from the coronavirus. Over the past 12 months, rent performance was negative for all top markets surveyed by Yardi Matrix. However, month-over-month, only 19 percent of markets had negative street-rate performance.

The post Central Nashville Storage Asset Receives Refi appeared first on Commercial Property Executive.

Nashville Yards. Image courtesy of CBRE

Real estate investment firm Southwest Value Partners has selected CBRE to handle property management at Nashville Yards, a 17-acre mixed-use campus in Nashville, Tenn. The development will include a 20-story, 566,000-square-foot Class A office tower occupied by Amazon, which is scheduled for completion in 2021.

The Nashville Yards development is designed to have more than 3.5 million square feet of office space, approximately 1,000 multifamily units and 400,000 square feet of retail and entertainment space. Gresham, Smith and Partners is the main architect of the project, while Clark Construction and BELL & Associates Construction are acting as general contractors. CBRE’s Associate Director David Cheek is coordinating the management efforts.

Located at the western edge of downtown Nashville, the campus stretches from Broadway to Church Street and will also feature a 591-room Grand Hyatt hotel and a concert venue in addition to the office space and various retail and dining options. Amazon’s future operations center is located at 1001 Church St. The e-commerce giant leased roughly 500,000 square feet of the tower in July of last year, according to a report by Bisnow.

The post CBRE to Manage 17-Acre Nashville Campus appeared first on Commercial Property Executive.

ONE22ONE. Image courtesy of GBT Realty

The 365,000-square-foot project has been making headlines for being the first new office building in Nashville to incorporate virus-mitigation features, as well as for two important announcements: FirstBank will be the project’s anchor tenant, with plans to expand, and its parent company is also preparing to relocate its headquarters into the building. 

What is ONE22ONE all about? Managing Director Jeff Pape is very optimistic about the impact the development will have on the metro’s office market when it delivers in 2022. 

READ ALSO: Nashville Commercial Real Estate Wrap-Up – June 2020

ONE22ONE may seem like a daring move during these challenging times for the office market. What makes you confident about this development?

Jeff Pape, Managing Director, GBT Realty. Image courtesy of GBT Realty

Pape: While it may seem that we are amid challenging times for the office sector, GBT remains confident in this sector, particularly for an office tower such as ONE22ONE. The building is located on a site that offers the best access, views and amenities in a high-growth market such as Nashville, providing quick connectivity to the center of downtown, out of downtown and onto interstates 40 and 65. On top of that, we believe the corporate office workspace will continue to play an imperative role in successful business operations. Direct collaboration and personal connectivity with peers cannot be replicated in an online environment. 

What is ONE22ONE’s development timeline for the rest of the year?

Pape: Groundbreaking was completed and construction is underway. We expect to be coming out of the ground in the next few weeks.

The building will incorporate a number of health-related elements to ensure protection against viruses and other health concerns. What are three of your favorite features?

Pape: The HVAC system is designed to allow each office floor to operate independently of other floors, eliminating the sharing of air supply or return air between floors or tenants. This aids in stopping viruses from spreading throughout the building.

This iconic office tower offers a near touchless experience—everything from elevator dispatch to hands-free faucets, motion light sensors, a mobile parking app, and more. This means that employees will rarely have to touch anything beyond their own supplies and equipment.

Our emergency response plan includes thermal scanning in the building lobby to identify any individuals with excessive temperatures entering the building, upgraded HVAC filters and enhanced cleaning protocols.

ONE22ONE. Image courtesy of GBT Realty

What challenges do you expect when implementing these key features? 

Pape: We expect to implement these new design best practices very easily and with minimal costs. The COVID-19 pandemic began before ONE22ONE’s construction and final design plans, allowing us to pivot and enhance various aspects relatively quickly. For existing buildings or buildings further along in construction, a number of these features will be much more challenging and expensive to implement.

Tell us about the certifications you are aiming to qualify for with this project.  

Pape: Due to the sophisticated design and the elevated standards of health and wellness mentioned above, ONE22ONE certainly has the potential to pursue a WELL v2 designation—the next version of the pioneering WELL Building Standard. Final determination of the pursuit of the certification will be determined once we are further along in the development process.  

How did the financing process unfold under the current circumstances?

Pape: There remains a deep belief and determination in Nashville moving forward. This market will continue to be very attractive for corporate relocations, and even employee relocations, as more companies are opening the door for remote work. Mack Real Estate Credit Strategies and Koch Real Estate Investments are funding our projects, which speaks to their belief in Nashville and in ONE22ONE in the long term, as well. Closing on construction funding during a worldwide pandemic posed some challenges, but the entire team quickly adapted to video calls. There was even a noticeable focus on getting the deal done, as everyone was working from home.

ONE22ONE. Image courtesy of GBT Realty

In what way and to what extent do you think the development of ONE22ONE will be affected by the economic slowdown? 

Pape: Our development team is doing everything possible to mitigate risk during this uncertain time and impending economic slowdown. The forward approach to design and adaptations we implemented prior to construction will support our efforts to control project costs and deliver on time.

How about leasing activity?

Pape: This month, we announced our anchor tenant—FirstBank, a fast-growing and prolific Nashville-based bank with statewide reach. The financial institution is leasing 52,000 square feet on floors 13 and 14, with the right to expand its footprint within the building to over 100,000 square feet. Additionally, the bank’s parent company, FB Financial Corp., will be headquartered at ONE22ONE. Given the considerable leasing momentum already underway, we expect more tenant announcements to come soon.

What are your predictions for office demand in Nashville?

Pape: ONE22ONE will deliver in 2022. As of now, it is the only office tower in the pipeline for that delivery time frame. Although we are already seeing considerable leasing interest, we are confident that the market will stabilize even more over the next 18 to 24 months, as companies realize that in-person collaboration is still needed for long-term success. Our building is already uniquely positioned given its location, amenities and iconic design that address the needs of the current pandemic environment.

The post New Nashville Tower Adds Anti-Virus Features appeared first on Commercial Property Executive.

11225 Parkside Drive. Image via Google Street View

One Liberty Properties has sold a 35,300-square-foot building in Knoxville, Tenn., for $18 million. The proceeds were used to repay an $8.5 million mortgage on the property, to pay down $8.7 million of debt on a credit facility and to cover the expenses associated with the deal. CarMax Auto Superstores occupies the entire building.

Located at 11225 Parkside Drive on 10 acres, the 2002-built asset is just off Interstate 40. The property is part of a dense retail corridor, which includes The Pavilion of Turkey Creek and The Pinnacle at Turkey Creek, two commercial centers which are within walking distance of the CarMax. Downtown Knoxville is roughly 16 miles away. 

According to public records, One Liberty acquired the property from GE Capital in 2004, for $11.4 million. Over the past six months, the asset generated $573,000 of rental income for the former owner.

In 2018, One Liberty acquired a 291,203-square-foot facility in Pennsburg, Pa., in a deal brokered by CBRE. The asset is net leased through 2028.

The post One Liberty Properties Sells Knoxville Asset for $18M appeared first on Commercial Property Executive.

2011 Murphy Ave.

Saint Thomas Health has paid $33 million for a 163,539-square-foot medical office building in Nashville, Tenn., public records show. The seller was a Florida-based private investor, according to Yardi Matrix information. The buyer already owned the land and was leasing it to the seller via a ground lease agreement.

Located at 2011 Murphy Ave., the six-story building is adjacent to both TriStar Centennial Medical Center and Saint Thomas Midtown Hospital, roughly a mile from Vanderbilt University and less than 2 miles from downtown Nashville. The asset has easy access to major transportation arteries including interstates 40, 65 and 440 and is a short distance from a variety of retail and hospitality options.

Completed in 1998 on a 5.4-acre site, the property is fully leased to Saint Thomas Health. The health-care provider offers services including women’s care and spinal and joint replacement surgery through specialized clinics.

Earlier in July, one of the country’s largest health-care administration companies announced the selection of Charlotte, N.C., as the location of its upcoming $1 billion East Coast headquarters. Centene Corp.’s 1 million-square-foot property will bring an estimated 6,000 jobs to the metro.

The post Nashville MOB Trades for $33M appeared first on Commercial Property Executive.

401 Enos Reed Drive. Image via Google Maps

Setzer Properties has purchased a Nashville, Tenn., shipping terminal from XPO Logistics for $17.3 million, according to public records. Traditional Bank provided the buyer of the 98,889-square-foot facility with a one-year, $14.6 million acquisition loan.

XPO Logistics had acquired the asset as part of its 2015 purchase of Con-Way Transportation Services, according to the Nashville Post. Setzer primarily invests in industrial properties occupied by XPO and a number of other shipping companies.

Located at 401 Enos Reed Drive, the asset is within 5 miles of both downtown and Nashville International Airport. Interstates 40 and 24 are less than 1.5 miles away, enabling direct access to the metro and wider region. The asset is some 10 miles west of a 362,000-square-foot industrial park slated for delivery this summer.

The main building has 67,270 square feet of industrial space and a 12,579-square-foot office component. The T-shaped structure has approximately 160 covered loading doors and the 18.3-acre parcel has ample on-site trailer parking. Most of the property dates back to 1963, though Con-Way constructed a 19,040-square-foot service garage in 2000 at the southern end of the site.

The post XPO Logistics Sells Nashville Shipping Terminal appeared first on Commercial Property Executive.

Hutton Hotel. Image courtesy of Geolo Capital

While Nashville had begun reopening, local authorities decided to reexamine the process following an uptick in new coronavirus cases, with modified phase two conditions going into effect one day before July 4. The list of restrictions includes a ban on gatherings of more than 25 people. Retail stores, gyms, salons and restaurants are set to operate at limited capacity, while bars and dance floors remain closed. 

Meanwhile, the commercial real estate sector recorded some activity last month, including several notable moves by GBT Realty. Read our June list of Nashville must-knows:

1. DEAL – Joint venture acquires 250-key Midtown hotel.

The partnership includes BentallGreenOak, Flank Management LP and Geolo Capital. The joint venture bought the property in an all-cash transaction. Hutton Hotel came online in 2009 and underwent a full renovation in 2017. Common-area amenities include a fitness center, recording studios, more than 20,000 square feet of event space and a 5,000-square-foot social club. Located at 1808 West End Ave., the hotel is approximately 2 miles from downtown Nashville.

2. FINANCING – GBT Realty, Chartwell Hospitality land $87 million construction loan.

First Horizon Bank provided the financing for Parke West, a mixed-use development located at 3415 Murphy Road. GBT Realty received $56.5 million for the residential and retail components, while Chartwell secured almost $31 million to develop two hotels. The 1.5-acres site is situated within 2 miles of downtown Nashville. GBT acquired the parcel in 2019, for $7.2 million.

3. LEASING – FirstBank inks anchor lease at upcoming trophy tower.

The bank is set to occupy more than 52,000 square feet at ONE22ONE, which is being developed by GBT Realty. The lease also offer FirstBank the option to expand to more than 100,000 square feet. Site work started in February and completion is scheduled for 2022. The 24-story tower located at 1221 Broadway is slated to include 365,000 square feet of office and 15,000 square feet of retail space. GBT has partnered with architecture firm Gresham Smith & Partners and general contractor Brasfield & Gorrie for the project. 

4. DEAL – Brennan Investment Group acquires Gallatin industrial facility. 

The firm also arranged the leaseback of the 90,250-square-foot property to Bennett Tool & Die. Located at 1550 Airport Road, about 1 mile from Music City Executive Airport, the property serves as the company’s headquarters and main manufacturing facility. The asset is 2 miles from downtown Gallatin and 30 miles from downtown Nashville via Interstate 65. According to the company, Brennan’s footprint across Tennessee and Kentucky adds up to 1 million square feet. 

5. PEOPLE – GBT Realty appoints new senior executive.

The company added Eric Spencer as vice president of investments and strategic planning. Most recently, he served as vice president of asset management and head of analytics for Jamestown Properties. Before that, he worked for JLL, ACG Professionals and CWCapital Asset Management. The newly appointed vice president is a graduate of Vanderbilt University.

The post Nashville Commercial Real Estate Wrap-Up – June 2020 appeared first on Commercial Property Executive.

ONE22ONE. Image courtesy of GBT Realty

GBT Realty has landed FirstBank as the anchor tenant for its upcoming ONE22ONE mixed-use tower in Nashville, Tenn., that was designed for a post COVID-19 environment.

READ ALSO: A Closer Look at the Post-COVID-19 Office Landscape

The Tennessee-based local bank will be taking 52,000 square feet across floors 13 and 14 of ONE22ONE in a lease that offers an option to expand to more than 100,000 square feet. In addition to FirstBank securing its spot as the building’s anchor tenant, the bank’s parent company FB Financial Corp. will also be headquartered at ONE22ONE through the same lease.

ONE22ONE. Image courtesy of GBT Realty

Located at 1221 Broadway in downtown Nashville, the 24-story Class AA mixed-use tower will include 365,000 square feet of office space and 15,000 square feet of retail and restaurant space on the first and second floors. The modern office tower will also include a fitness room, conference rooms, a mothers’ room, an on-site concierge and greenspace for general or private use.

GBT tapped Gresham Smith & Partners to oversee the architecture and design, while Brasfield & Gorrie are the general contractors. CBRE’s Frank Thomasson, Taylor Hillenmeyer, Janelle Gallagher and Byran Fort are marketing the office space and GBT’s Alex Samuels and Alan Lloyd from the marketing team are in charge of leasing up the retail and restaurant space. In April, Mack Real Estate Credit Strategies provided a $141 million construction loan for ONE22ONE to GBT and Koch Real Estate Investments, GBT’s limited partner in the development.

Jeff Pape, GBT’s managing director for the shopping center and diversified division, told Commercial Property Executive that the company broke ground on ONE22ONE in February and is expected to be complete by June 2022.

Designing with COVID-19 in mind

As the COVID-19 pandemic has shuttered many office spaces, GBT was able to update the design of ONE22ONE with new health standards. The building will be equipped with independent HVAC systems, thermal scanning for health screenings and a near-touchless experience including for elevators.

“ONE22ONE’s design was always state-of-the-art, but we were early enough in the process that we were able to efficiently make design modifications once the pandemic reached the U.S.,” Pape told CPE. “Now, the building will include all of the latest health and safety enhancements addressing airborne pathogens and viruses such as COVID-19.”

Pape also said that ONE22ONE’s enhanced design and virus mitigation features have attracted even more inquiries from potential tenants.

The post FirstBank Signs Anchor Lease at Nashville Tower appeared first on Commercial Property Executive.

Parke West. Rendering courtesy of GBT Realty

First Horizon Bank has provided $87.4 million in construction financing for Parke West, GBT Realty’s mixed-use development in Nashville, Tenn., according to public records. GBT Realty took $56.5 million for the project’s residential and retail components, and Chartwell Hospitality will utilize $30.9 million to develop lodging in a separate tower on the site.

The project site encompasses 1.5 acres alongside Interstate 440 at 3415 Murphy Road, some 2 miles southwest of downtown Nashville. GBT had acquired the parcel—then home to a building owned by Fifth Third Bank—in August 2019 for $7.2 million.

Chartwell Hospitality joined Parke West recently, Davidson County records show. The firm paid GBT $6.5 million for a nearly 30 percent interest in the project just before the financing deal closed. The 172-key hotel’s plans call for nine stories in a separate tower rising from the western side of the parcel. According to Nashville Post, the hotel will operate under two flags: Hilton Garden Inn and Home2 Suites. Plans filed with Davidson County show the property will have an indoor swimming pool on its top floor.

Plans for the project’s 253,262-square-foot multifamily component call for 210 units in a tower rising 14 stories above 11,455 square feet of retail space. The community will have two elevators and an outdoor swimming pool on a 12th floor deck. Some 450 parking spaces will be located underground, with nearly half allocated to the residential side of the development.

Rising to the challenge

Nashville’s hospitality sector currently faces serious challenges as a result of the pandemic. Although the market had grown in importance as a business hub and major tourist destination, the path forward is likely to be long, with travel—both for work and pleasure—likely to take years to recover at the national level.

That said, hotel investors and developers are far from inactive in Music City, even in these uncertain times. Since the impact of COVID-19 hit the metro, several major hospitality deals have closed. Earlier in June, three investors joined forces to acquire the 250-key Hutton Hotel, some 1.5 miles northeast of GBT and Chartwell’s project.

The post Nashville’s Parke West Scores $87M Project Loan appeared first on Commercial Property Executive.

Hutton Hotel. Image courtesy of Geolo Capital

Three investment companies have teamed up to purchase a hotel in Nashville, Tenn., amidst the current market conditions caused by the COVID-19 pandemic. The partnership of BentallGreenOak, Flank Management LP and Geolo Capital have purchased Hutton Hotel in an all-cash transaction from an undisclosed seller.

READ ALSO: How and When Will Hotels Recover?

Nashville’s Hutton Hotel first opened in 2009 and later underwent a full renovation in 2017. The 250-key property offers guestrooms that range from 300 to 480 square feet, as well as three penthouse suites between 1,100 and 4,660 square feet. The four-star, four-diamond hotel’s amenities include a Tesla Model S for guest use, a fitness center, spa treatment suites, two writers studios for writing and recording music, more than 20,000 square feet of event and creative space that includes 13,600 square feet of flexible space and a 5,000-square-foot social club and entertainment venue. Guests can also dine at the hotel’s three restaurants, Mane & Rye Dinerant, Coffee Shop and Analog.

Located at 1808 West End Ave., Hutton Hotel is roughly 2 miles away from downtown Nashville and less than a mile away from the city’s Music Row neighborhood and its musical attractions. 

Brad Nichols, principal of development and construction for Geolo, told Commercial Property Executive that the new owners will be finalizing its reopening and improvement strategies over the next couple of weeks.

Confidence in Nashville market

Nichols also told CPE that the three companies have long-standing relationships but the hotel acquisition in Nashville marks their first formal partnership. Geolo has worked with others in the past, including with JW Capital Partners to build a 225-key luxury hotel in Washington, D.C. that recently traded for $120 million.

”We’re all big believers in Nashville in general,” Nichols told CPE. “The economy is strong and diverse, the business climate is friendly, its growth has been organic and tremendous over the past decade and we believe it will be sustained on the other side of current affairs.”

Nichols added that the partnership expects the Nashville market to rebound from the current economy faster than most. In the future, the three companies will be looking at opportunities across markets and asset types but would likely stick to hospitality and multifamily properties with long-term value creation prospects in core markets like Nashville, Nichols told CPE.

The post Geolo Capital JV Acquires Nashville Hotel appeared first on Commercial Property Executive.

Embassy Suites by Hilton Nashville Downtown Convention Center. Image courtesy of HVMG

With the state economy slowly reopening going into May, Nashville’s commercial real estate market saw some notable activity, especially—and a bit surprisingly—in the hospitality sector. A brand new downtown hotel received $60 million in financing, while a 168-room property scored a $58 million refinancing loan. Additionally, Wells Fargo financed a mixed-use downtown development. Read our May list of Nashville must-knows:

1. FINANCING – Newly built hotel scores $60 million in financing.

Drury Development Co. has obtained financing for Drury Plaza Hotel Nashville Downtown, a 389-key property, which is in proximity to the Country Music Hall of Fame and Museum and Music City Center. Central Bank of St. Louis originated a $50 million loan, while the company took a $10 million self-financed loan.

2. MANAGEMENT – Hospitality Ventures to manage upcoming downtown Hilton.

The Embassy Suites is a 506-key project, located at 708 Demonbreun St. A partnership including Crescent Real Estate, Starwood Capital Group and High Street Real Estate is developing the two-tower property. The hotel is slated for a 2021 opening. When complete, the asset will be the second-largest property under the Embassy Suites brand.

3. FINANCING – Royal Investments lands $58 million for Dream Nashville refi.

The financing retires a $48.9 million construction loan provided by Fifth Third Bank in 2016. The new financing was provided by Barings. Dream Nashville opened in 2019 and has 168 rooms. Located at 210 Fourth Ave. N., the asset is within half a mile of the Country Music Hall of Fame and Museum and the State Capitol.

4. FINANCING – Downtown mixed-use development scores $93 million loan.

According to Nashville Business Journal, Taylor Place is slated for completion is 2022. The site is located at 602 Taylor St. in Germantown, with the project also including the revitalization of the 75-year-old Werthan Building. The project’s architect, Smith Gee Studio, is scheduled to be the development’s first tenant, having signed for 14,000 square feet. SWH Partners, The Mathews Co. and Soundview Real Estate Partners are part of the team spearheading the development. The loan was originated by Wells Fargo Bank.

The post Nashville Commercial Real Estate Wrap-Up – May 2020 appeared first on Commercial Property Executive.

Dream Nashville. Image via Google Street View

As unprecedented challenges face the hospitality sector, Royal Investments has closed on a $58 million refinancing package from Barings for Dream Nashville, a 168-key hospitality asset in downtown Nashville, Tenn. The three-year note retires a $48.9 million construction mortgage provided by Fifth Third Bank in 2016, according to public records.

The property opened in March 2019, following approximately two and a half years of construction work. Backing up to Printers Alley at 210 Fourth Ave. N., the 10-story boutique hotel rises from the historic Utopia Hotel, which dates back to 1891. Dream Nashville’s position in the heart of the city center puts it within half a mile of the Country Music Hall of Fame and Museum, Music City Center and the State Capitol.

The hotel’s guestrooms range from 235 to 500 square feet, with an additional 1,400-square-foot presidential suite on the top floor. Amenities include a 24-hour fitness center, complimentary Wi-Fi, valet parking along with six restaurants and bars. The property also has 8,000 square feet of event space.

The post Nashville’s Dream Hotel Lands $58M Refi appeared first on Commercial Property Executive.

Embassy Suites by Hilton Nashville Downtown Convention Center. Image courtesy of HVMG

Hospitality Ventures Management Group has been named to oversee operations of the Embassy Suites side of a dual-hotel development in Nashville, Tenn. A partnership between Crescent Real Estate, Starwood Capital Group and High Street Real Estate is building the two-tower project, which is slated to open in the fourth quarter of 2021.

Located at 708 Demonbreun St., the 506-key Embassy Suites by Hilton Nashville Downtown Convention Center will have a ground-floor restaurant, coffee shop and entertainment areas. The 30-story hotel’s guest amenities will include a rooftop pool, event areas, a bar, dedicated wellness areas and more than 32,000 square feet of meeting and event space. When complete, the property will be the second-largest property under the Embassy Suites flag.

The other tower within the development will be home to Starwood’s luxury 1 Hotel brand. The 18-story building will have 215 suites. The full development site is across the street from Nashville’s 2.1 million-square-foot Music City Center, a block away from the Bridgestone Arena and a short distance from the Country Music Hall of Fame, Ryman Auditorium and the Frist Art Museum.

In addition to its role in this development, Starwood has been actively involved in Nashville’s hospitality sector for years. Last fall, the investor divested from a 296-key Embassy Suites near the city’s airport in an $80 million deal. 

New hotel, new director

Anticipating the additional workload with the new hotel, HVMG named Annebeth Kearney Black as its director of sales and marketing in Nashville. Kearney Black has more than 20 years in the hospitality sector under her belt and was most recently the associate director of sales for the 591-key Grand Hyatt Nashville.

In her new role, she will lead the hotel sales team, particularly as the Embassy Suites Nashville Downtown Convention Center takes shape. Kearney Black said in prepared remarks that the hotel will allow for larger meetings and cater to upscale travelers for business, conventions, or leisure.

The post HVMG to Manage Downtown Nashville Hilton appeared first on Commercial Property Executive.

2960 & 2964 Miller Place Way. Image courtesy of Hanley Investment Group

Hanley Investment Group has finalized the disposition of two retail properties totaling 14,347 square feet in Knoxville, Tenn., and Somerset, Ky.

A private investor acquired both assets for $7 million in an all-cash transaction. Executive Vice Presidents Jeff Lefko and Bill Asher, along with Associate Dylan Mallory, assisted the two sellers.

The Knoxville property sits on a one-acre lot at 2960 & 2964 Miller Place Way. The 7,500-square-foot building came online in 2015. Aspen Dental and Visionworks fully occupy the property on a triple net-lease. Lefko and Asher negotiated on behalf of the seller, a private investor. The asset changed hands for $4.3 million.

Located on a one-acre parcel at 2007 S. Highway 27, the Somerset asset is a 6,847-square-foot property completed in 2015. The building is fully occupied by VIsionworks, Kay Jewelers and GNC on a triple net-lease. Mallory arranged the deal on behalf of Thompson Thrift Retail Group, which sold the asset for $2.6 million.

In April, Lefko and Asher represented TOLD Development Co. in the $2.7 million disposition of a 4,370-square-foot Bank of America building in Brooklyn Center, Minn.

The post Hanley Investments Brokers All-Cash Retail Sale appeared first on Commercial Property Executive.

Image via Pixabay.com

Drury Development Co. has obtained a $60 million financing package for Drury Plaza Hotel Nashville Downtown, a recently constructed, 389-key property. Central Bank of St. Louis originated a $50 million note and the company took a $10 million self-financed loan, according to public records. Both mortgages mature in April 2023. 

The property is the company’s third hotel in Nashville and fourth in the state. The developer acquired the land parcel for $2.5 million in 2017 from a private investor. Located on 1 acre at 300 Korean Veterans Blvd., the 22-story hotel opened in late December last year. Amenities include an 8,000-square-foot conference room, a business center, indoor and outdoor swimming pools and a gym. 

Situated in the SoBro neighborhood, the property is close to the Country Music Hall of Fame and Museum, Music City Center and Bridgestone Arena. Nashville International Airport is 7 miles east. The hotel is also within a few blocks of another newly opened hospitality asset, the Hyatt House Nashville/Downtown, which traded for $57.8 million in March.

The post Newly Opened Nashville Hotel Gets $60M Financing appeared first on Commercial Property Executive.

ONE22ONE. Rendering courtesy of GBT Realty Corp.

Although the COVID-19 pandemic stifled Nashville’s commercial investment activity in April, the market saw some notable activity in terms of both development and financing. With construction considered an essential business under shelter-in-place orders, developments continued to line up financing under favorable terms following the Fed’s rate cuts earlier this year. Read our April list of Nashville must-knows:

1. FINANCING – High-rise office project gets $141 million loan.

A partnership between GBT Realty Corp. and Koch Real Estate Investments obtained the construction mortgage for ONE22ONE, a 356,000-square-foot, Class A office tower in downtown Nashville. Mack Real Estate Credit Strategies originated the note. The Greshan Smith-designed development is slated for delivery in 2022. Situated close to Interstate 40 at 1221 Broadway, the building will rise 24 stories and include 15,000 square feet of retail at the street level.  

2. FINANCING – Charles Hawkins refinances 286,000-square-foot warehouse.

Franklin Synergy Bank provided the $11 million mortgage, which retired a $6.6 million note the lender had originated in 2016. Built in 1982, the property is on 20 acres at 7235 Cockrill Bend Blvd. The building has a mix of 15 dock-high and three grade-level doors, as well as a two-story office component. The facility is home to Alexander’s Mobility Services.

3. DEVELOPMENT – Downtown office property to become 116-key hotel.

Epoch Construction & Design plans to transform the unused four-story structure at 333 Union St. into a 10-story Radisson RED property, according to Nashville Business Journal. DAV Construction will be the general contractor for the Southeast Venture-designed project. The property, slated for delivery in November 2021, will include an underground bar and guest amenities on the rooftop.

The post Nashville Commercial Real Estate Wrap-Up – April 2020 appeared first on Commercial Property Executive.

7235 Cockrill Bend Blvd. Image via Google Maps

Charles Hawkins Co. has obtained an $11 million refinancing loan for a 286,235-square-foot industrial facility in Nashville, Tenn., public records show. Franklin Synergy Bank originated the note, which retires a $6.6 million mortgage the lender had provided in 2016.

The borrower, a member of CORFAC International, acquired the asset in 2014 as part of a $6.9 million portfolio transaction from Spring Global which included an adjacent, 295,000-square-foot building, according to Yardi Matrix data.

The warehouse, completed in 1982, is located on 20 acres at 7235 Cockrill Bend Blvd. The building has 15 dock-high and three drive-in doors and a two-story office component. The property is home to Alexander’s Mobility Services and is 3 miles from Interstate 40 and roughly 16 miles west of Nashville International Airport.

Even amidst the coronavirus pandemic, the national industrial market ended the first quarter on a strong note, according to a recent CBRE report. Despite widespread shelter-in-place orders, construction on many logistics projects continues to move forward, although speculative development began to slow.

The post Nashville Industrial Asset Lands $11M Refi appeared first on Commercial Property Executive.

ONE22ONE. Rendering courtesy of GBT Realty Corp.

A joint venture between GBT Realty Corp. and Koch Real Estate Investments has secured a $141 million construction loan for ONE22ONE, a Class A office tower in downtown Nashville, Tenn. Mack Real Estate Credit Strategies provided the financing.

READ ALSO: Nashville Commercial Real Estate Wrap-Up – March 2020

Site work for the project started in February, with Gresham Smith as the development’s architect. The tower is set to include 24 stories, 356,000 square feet of leasable space and 15,000 square feet of retail space on the ground floor. Completion is scheduled for 2022.

Located at 1221 Broadway, ONE22ONE is just off Interstate 40 and is within 1 mile of Tennessee State Capitol and 2 miles of Nissan Stadium. The site is also half a mile from a two-tower project, which received a $278.9 million construction loan from Bank OZK in March.

CBRE’s Taylor Hillenmeyer, Janelle Gallagher, Frank Thomasson and Byran Fort.  are the leasing brokers for the office space. Alex Samuels and Alan Lloyd of GBT are handling leasing for the retail space.

The post Nashville Office Project Lands $141M Construction Loan appeared first on Commercial Property Executive.

Hyatt House Nashville/Downtown – SoBro. Image courtesy of Hyatt Hotels Corp.

Music City buzzed with activity across several asset types in March. Although the hospitality industry faces steep challenges due to the COVID-19 pandemic, two major deals closed in the metro involved hotels, potentially helped along by the Federal Reserve’s two rate cuts this month. Companies also invested to expand their office and industrial reach within the region. Catch up on our March selection of Nashville must-knows:

1. DEAL – Southeast Nashville industrial asset changes hands.

A private investor sold the 216,993-square-foot facility for $15.7 million, public records show. TPG Real Estate acquired the property, according to Nashville Post. Located on 11 acres at 3287 Franklin Limestone Road, the single-story building opened its doors in 1995 and is 5 miles from Nashville International Airport. Tenants include Outdoor Recreation Co. of America and Nashville Packaging.

2. DEAL – Hyatt property trades for $57.8 million.

Noble Investment Group purchased the 217-key Hyatt House Nashville/Downtown-SoBro from Mountain Shore Properties, according to public records. Truist Bank provided $52.1 million in acquisition financing. Located at 535 Fifth Ave. S., the six-story building delivered in February, more than two years after construction began at the end of 2017.

3. LOAN – Downtown towers project receives $278.9 million construction loan.

Bank OZK provided the financing for Propst Development’s two projects. The first development will be a 21-story, 510,000-square-foot office building with a 42,000-square-foot retail component, according to Nashville Business Journal. The second, a 34-floor high-rise, will house a Hilton Conrad hotel and 196 upscale apartments. The note represents more than half of the project’s estimated $540 million cost. Propst had purchased the 4-acre site at 1600 West End Ave. from a local developer two years before.

4. DEAL – Nuveen buys 317,000-square-foot Brentwood portfolio.

The company paid $30 million for a 117,000-square-foot office property at 5500 Maryland Way and acquired the two, 100,000-square-foot buildings at 5200 Virginia Way for more than $50 million, according to Nashville Post. Seller Northwestern Mutual had paid a combined total of $46.6 million for the portfolio in 2010.

5. PEOPLE – Cushman & Wakefield names Nashville director.

The firm appointed Lonnie Russel as director of its industrial agency leasing group. With more than 35 years of experience in the field, he will be responsible for overseeing Duke Realty’s 3.6 million-square-foot industrial portfolio in the market. Previously, Russell served as vice president of leasing at Duke Realty. He had earlier worked in property management for Centennial and Property Company of America.

The post Nashville Commercial Real Estate Wrap-Up – March 2020 appeared first on Commercial Property Executive.

3287 Franklin Limestone Road. Image via Google Street View

A 216,993-square-foot industrial property in Nashville, Tenn., has changed hands for $15.7 million, according to public records. A private investor purchased the 1995-built asset. 

Located on 11 acres at 3287 Franklin Limestone Road, the single-story facility is a mile from Interstate 24, which provides access to interstates 40 and 440. Nashville International Airport is 5 miles away and Nashville city center is roughly 10 miles southeast from the facility. The tenant roster includes Outdoor Recreation Co. of America and Nashville Packaging, a subsidiary of Dalton Box. Hormann, Vulcan Materials and American Tire Distributors are among other companies in the area. 

The warehouse is 5 miles from Hamilton Creek Commerce Park, StateStreet’s 362,000-square-foot industrial development at 2737 Couchville Pike. The company broke ground on the four-building project in November 2019, with the development of the park slated for delivery this summer. The upcoming asset will be leased through Cushman & Wakefield. 

The post Southeast Nashville Industrial Asset Trades for $16M appeared first on Commercial Property Executive.

Hyatt House Nashville/Downtown – SoBro. Image courtesy of Hyatt Hotels Corp.

Mountain Shore Properties has sold Hyatt House Nashville/Downtown-SoBro, a 217-key hotel in Nashville, Tenn., for $57.8 million, according to public records. The buyer, Noble Investment Group, took $52.1 million in acquisition financing from Truist Bank to close the deal. The hospitality property opened its doors in February, more than two years after breaking ground in late 2017.

Located at 535 Fifth Ave. S., the six-story hotel is within Nashville’s SoBro district, 1 mile southeast of the Capitol and two blocks from both the Music City Center and the Country Music Hall of Fame. The asset is within 1 mile of nearly 10.5 million square feet of completed office space, according to data from Yardi Matrix.

The Hyatt House property has a mix of standard guestrooms and 134 suites, ranging from 300 to 1,214 square feet. Guest amenities include a 24-hour fitness center, an indoor swimming pool, complimentary Wi-Fi, a business center and a bar.

Nashville has positioned itself as a major tourism and business hub in recent years, driving hotel development to cope with growing demand. Mountain Shore’s sale comes amidst growing uncertainty in the hospitality sector due to the new coronavirus, however. A report from Marcus & Millichap predicts that the sector will see immediate and major impacts nationwide as business travel, tourism and conferences all scale back.

The post Noble Investment Pays $58M for Nashville Hyatt appeared first on Commercial Property Executive.

Lonnie Russell, Director, Cushman & Wakefield. Image courtesy of Cushman & Wakefield

After kicking off 2020 with a new advisory group and a high-profile hire in New York City, Cushman & Wakefield has named Lonnie Russel as director in the firm’s industrial agency leasing group. He will be overseeing Duke Realty’s 3.6 million-square-foot industrial portfolio in Nashville, Tenn.

Russell brings to the new role more than 35 years of experience in the commercial real estate market. Prior to joining Cushman & Wakefield, he served as vice president of leasing at Duke Realty, where he was responsible for business development and leasing related to the company’s 5 million-square-foot office and industrial portfolio in Nashville.

Cushman & Wakefield’s new director began his career as a project manager for Classified Parking Systems in Houston and then switched to property management while working for Property Company of America and Centennial Inc. Russell holds a bachelor’s degree in Business Administration in Management and Finance from Mississippi State University.

The post Cushman & Wakefield Adds New Nashville Director appeared first on Commercial Property Executive.

222 Second Ave. Image via Google Street View

The Nashville metro had its fair share of notable deals in the past four weeks. Regional and national investors continued deploying capital across sectors, following a banner 2019. In February, companies including Hines and PGIM made major moves in the Music City. Here is Commercial Property Executive’s list of Nashville must-knows for the month:

1. DEAL – Hines sells office tower for $264.1 million.

Starwood Property Trust acquired the office component of the 25-story skyscraper located at 222 Second Ave. S., according to Nashville Post. Completed in 2017, the 390,000-square-foot building includes 29,000 square feet of ground-floor retail. The tower is home to CBRE, Bank of America and Universal Music Group.

2. DEAL – PGIM Real Estate pays $40.5 million for Amazon distribution center.

A partnership between Distribution Realty Group and Crow Holdings sold Interchange Center I, a 517,500-square-foot warehouse in Antioch, according to Nashville Business Journal. Completed in 2018, the property is located on 32 acres at 3818 Logistics Way. The building is close to Interstate 24 and roughly 10 miles from Nashville International Airport.

3. DEAL – Stockbridge acquires Trader Joe’s-anchored retail asset. 

Boyle Investment Co. finalized the $45.3 million sale of Lion’s Head Village, a 100,000-square-foot retail center anchored by Trader Joe’s. The property at 90 White Bridge Road is also home to Stein Mart and Plato’s Closet, with Target as a shadow anchor. JLL negotiated on behalf of the seller.

4. DEAL – Winston Hospitality sells 161-key hotel poised for expansion.

JMI Realty acquired Indigo Hotel Nashville for $59.3 million, according to public records. Located at 301 Union St. on 0.3 acres, this is the company’s first Music City property, Nashville Business Journal reports. An adjacent building at 231 Third Ave., which has been approved for a 13-story extension, was also included in the deal. Granite Point Mortgage Trust is providing $50.2 million in financing.

The post Nashville Monthly CRE Wrap-Up (Feb. 2020) appeared first on Commercial Property Executive.

Village Hills at Nashboro Village

Starwood Capital Group has sold Nashboro Village, a 994-unit Class B multifamily portfolio in Nashville, Tenn., to Waterton for $140 million, according to Davidson County records. Wells Fargo provided the buyer with $105 million in acquisition financing through Freddie Mac. The mortgage matures in 2027.

The acquisition marks Waterton’s first purchase in the metro amid steady expansion into a number of other high-growth multifamily markets. Starwood had picked up the portfolio as part of a $2.9 billion purchase from The Milestone Group in April 2017.

Starwood’s disposition reduces its Nashville portfolio to 865 units, Yardi Matrix shows. In September, the company also sold a 296-key hotel near the city’s airport for more than $80 million. The investor is not stepping off the Music City stage, however: In January, the firm joined forces with Crescent Communities and Pearl Street Partners to break ground on a 270-unit mixed-use opportunity zone project just outside The Gulch.

Value-add potential

Center Court at Nashboro Village

The properties have one- to three-bedroom apartments with floorplans from 645 to 1,427 square feet. Amenities include swimming pools, tennis courts, a dog park, a fishing pond and covered parking. The occupancy across the portfolio was 93.2 percent in December, 190 basis points below the metro average, according to Yardi Matrix. Waterton plans to invest in improvements to amenities, according to Nashville Business Journal, with unit renovations to occur on a rolling basis as leases expire.

The value-add portfolio spans five properties with a total of 72 buildings set on 66 acres. The assets include:

• Center Court at 740 Nashboro Blvd.
• Doubletree at 2228 Doubletree Lane
• Deerfield at 300 Long Hunter Lane
• Village Hills at 620 Village Hills Drive
• Village Green at 325 Village Green Drive

The assets are near two grocery-anchored retail properties and are less than 5 miles from Nashville International Airport. A public bus route directly links the neighborhood with central Nashville, 11 miles to the northeast.

The post Waterton Enters Nashville With $140M Buy appeared first on Commercial Property Executive.

Lion’s Head Village. Image courtesy of JLL

Boyle Investment Co. has sold Lion’s Head Village, a retail center anchored by one of the four Trader Joe’s locations in Tennessee. Stockbridge purchased the property for $45.3 million.

READ ALSO: Retail Remains Resilient

Located at 90 White Bridge Road, the nearly 100,000-square-foot retail center is home to department stores including Stein Mart, as well as thrift chain Plato’s Closet. The Trader Joe’s location opened in October 2019. Other such stores are situated in Nashville and two in other Tennessee cities. Nearby in a retail center at 26 White Bridge Road, a Target store is also considered to be a shadow anchor for Lion’s Head Village.

The 9.57-acre site is also 4 miles away from downtown Nashville and 2 miles from Vanderbilt University. Overall, Lion’s Head Village is located in a very affluent area of Nashville, with more than 73,200 residents whose households have an average income of $128,184 and a total buying power of $4.3 billion.

The Belle Meade/Green Hills submarket is one of the most highly sought-after submarkets in Nashville, according to Senior Managing Director Jim Hamilton, who led the JLL Retail Capital Markets team that represented Boyle Investment in the transaction. The deal was secured by HFF before it was acquired by JLL in July 2019.

New development in Nashville

In a similar deal in February 2018, Boyle sold another Nashville-area retail asset in Mount Juliet, Tenn. The company traded Providence Commons, a 110,137-square-foot retail center to TA Realty. Outside of their retail assets, Boyle also completed a 324,000-square-foot Class A office development in May 2019. The company delivered the 10-story building at 500 11th Ave. N. in downtown Nashville two years after breaking ground.

The post Boyle Investment Sells Nashville Retail Center for $45M appeared first on Commercial Property Executive.

Fifth Third Center

Nuveen Real Estate has provided an $89.4 million loan to The Blackstone Group to finance its December acquisition of Fifth Third Center, a 490,281-square-foot office high-rise in downtown Nashville, Tenn., according to public records. The $144.8 million deal closed less than two years after seller Goldman Sachs Asset Management paid $117.6 million to Lincoln Property Co. for the tower, per data from Yardi Matrix.

Located at 424 Church St., the property is three blocks from the UBS Tower, which changed hands for $135 million in March. Fifth Third Center is in the heart of the central business district, within half a mile of the State Capitol, the Music City Center and a wide range of hotels. Constructed in 1986, the 31-story Fifth Third Center is home to a diverse mix of tenants, from building namesake Fifth Third Bank to Regus and CoStar Group. The property has approximately 4,000 square feet of street-level retail space, a fitness center, an outdoor plaza and recently renovated common areas.

Blackstone’s acquisition is the metro’s largest since late 2013, when Highwoods Properties acquired The Pinnacle at Symphony Place for $152.8 million from Canyon Partners Real Estate. Nashville continues to attract significant investment—2019 marked two consecutive years this cycle exceeding $850 million in office transactions, according to Yardi Matrix.

The post Blackstone Takes $89M Financing for Big Nashville Buy appeared first on Commercial Property Executive.

Holiday Inn Express Nashville Airport. Image via Google Street View

Riller Capital has acquired the Holiday Inn Express Nashville Airport, a 207-key hotel in Nashville, Tenn., for $24.1 million from Starwood Capital Group, according to public records. The hospitality asset last changed hands in 2017, when Garrison Investment Group sold it for $18.4 million. 

The three-story hotel, constructed in 1997, is located at 1111 Airport Center Drive, less than a mile and a half from Nashville International Airport. The property’s position also benefits from nearby businesses—according to Yardi Matrix, 1.4 million square feet of office space is within 1 mile of the hotel, including two buildings which sold for $86 million in October.

In addition to its standard guestrooms and suites, the Holiday Inn Express has a range of amenities including three meeting rooms, an outdoor swimming pool, a fitness center and a business center. The property was last renovated in 2016.

Nashville’s hospitality market continues to expand, with several notable projects underway. Despite a significant slowdown in national RevPAR growth, averaging 1.1 percent year-over-year through the second quarter of 2019, Music City boasted gains of nearly 8 percent during the same period.

The post Starwood Capital Sells Nashville Hotel appeared first on Commercial Property Executive.

Northeast at McEwen. Rendering courtesy of JLL

Mitsubishi Motors North America is set to relocate its operations from Cypress, Calif., to Franklin, Tenn. The company has chosen a new home at Northside at McEwen, a property expected to come online in early 2020. Working with JLL, Mitsubishi signed a long-term lease for 40,000 square feet in the building, where it will occupy the seventh floor and half of the sixth floor. The firm has also retained the signage rights for the building.

Northside at McEwen will be situated at 4015 Aspen Grove Drive, less than 2 miles from Interstate 65, some 4 miles from downtown Franklin and within walking distance of various shopping options. The upcoming property is part of Boyle Investment Co.’s mixed-use project, which is designed to feature office, retail, industrial and residential buildings.

The JLL team that represented the tenant included Senior Vice President Scott Wetzell, Managing Directors Mitch Lundquist and Bo Tyler, and Associate Broker Kevin Ziomek.

The new deal comes a few months after Boyle Investment Co. delivered Capitol View’s Block E, a 324,000-square-foot office building in Nashville.

The post Mitsubishi Motors’ Cross-Country Move appeared first on Commercial Property Executive.

Hamilton Creek Commerce Park. Rendering courtesy of Cushman & Wakefield

StateStreet Group will add a new offering to Nashville’s high-demand industrial market with the development of Hamilton Creek Commerce Park. The real estate company has broken ground on the 362,000-square-foot master-planned project, which will be leased through Cushman & Wakefield. Design Constructors Inc. is the architect behind Hamilton Creek and T.W. Frierson serves as general contractor.

READ ALSO: Industrial Investors Shift Strategies: Report

Plans call for four Class A distribution buildings. The smallest structure is set to include 55,800 square feet, while the largest will encompass 160,000 square feet. Two buildings, totaling 71,200 square feet and 75,000 square feet, respectively, are also in the works. Situated at 2737 Couchville Pike, the property will be primed to accommodate last-mile delivery, given its location near two interstates and just 5 miles from Nashville International Airport.

StateStreet is scheduled to complete development of the park in the summer of 2020. Cushman & Wakefield’s Edward Waud, David McGahren, John Ditto and Doug Howard are handling leasing.

Feeding a hungry market

Groundbreaking of Hamilton Creek Commerce Park. Image courtesy of Cushman & Wakefield

If the robust fundamentals of Nashville’s industrial market endure for the next few quarters, Hamilton Creek will likely be well received. At the close of the third quarter, year-to-date net absorption totaled 6 million square feet, a notable increase over the 4.2 million square feet recorded for the same period in 2018 and a 200 percent increase over the city’s 10-year historical average, according to a recent report by Cushman & Wakefield. The 4.2 percent overall vacancy rate in the third quarter was 39 percent below Nashville’s 10-year historical average and at $4.7 per square-foot, the overall average asking rent was 20.4 percent higher than the 10-year historical average.

Cushman & Wakefield expects that high tenant demand will continue to sustain the strong numbers, despite the anticipated economic slowdown and record-breaking number of new projects that continue to come online: An average of 2.4 million square feet delivered in each of the three quarters this year.

Projects in the metropolitan Nashville pipeline include Holladay Properties’ 330,000-square-foot third phase of Airport Logistics Park, which got underway just weeks ago. Panattoni Development Co. will construct Buildings 3 and 4 at its Speedway Industrial Park, adding a total of more than 1 million square feet to the market in 2021, and Al. Neyer will complete the 600,000-square-foot Building 2 at Cedar Farms Industrial Park in 2021 as well. All three projects are speculative developments, further speaking to developers’ confidence in the market.

The post StateStreet Begins Work on 362 KSF Nashville Industrial Project appeared first on Commercial Property Executive.

Haywood Oaks Park

Albany Road Real Estate Partners has sold Haywood Oaks Park, a 325,700-square-foot Class B office asset in Nashville, Tenn., to Elmington Capital for $46 million, per public records. JPMorgan Chase provided $32.2 million in acquisition financing to the buyer. The seller had purchased the five-building office park in June 2017 for $34.8 million from TPA Group, according to Yardi Matrix.

Located 10 miles south of the city center at 5209 to 5217 Linbar Drive, the asset is in a suburban setting alongside Interstate 24. Haywood Oaks Park is on 26.7 acres, but also includes 4.2 acres of vacant land on two neighboring parcels. Most of the metro’s office investment has been concentrated in more central areas: In the 12 months prior to Elmington’s acquisition, only $42.4 million of the market’s $1.1 billion in transactions were in the Far South Nashville submarket. In March, Gramercy Property Trust traded a fully leased Class B building 4 miles south of Haywood Oaks for $17 million.

Constructed in 1988 and 1989, the property has a mix of flex and medical office space in addition to roughly 24,000 square feet of retail. The buildings’ tenants include Gaylor Electric, DaVita, Terracon and United Technologies. Yardi Matrix shows the property’s vacancy was at 7.9 percent in October, higher than the submarket average of 5.9 percent.

The post Elmington Capital Buys Nashville Office Park for $46M appeared first on Commercial Property Executive.

Margaritaville Hotel. Rendering courtesy of Margaritaville Enterprises

Safe Harbor Development has sold its interest in 52 timeshare units at the Margaritaville Hotel in Nashville, Tenn., for $22.2 million to Wyndham Destinations, according to Davidson County records. The units are one component of the $82 million, 217-key development which opened its doors at the end of October.

Located at 425 Fifth Ave. S. in the SoBro district, the Margaritaville is one block from the Music City Center and the Country Music Hall of Fame. In addition to tourists, the property caters to business travelers: More than 10.3 million square feet of office space is within a mile of the hotel, according to Yardi Matrix.

The 12-story building has a mix of standard guestrooms ranging from 370 to 450 square feet in addition to a selection of larger suites. Amenities include 10,711 square feet of meeting and event space, a fitness center, a rooftop swimming pool and valet parking.

Nashville’s hospitality market is thriving, with several major investment transactions closing in the past 12 months. In August, the 207-key Hampton Inn & Suites two blocks from the Margaritaville traded for nearly $102 million, one of the largest hotel sales in the metro this year.

The post Wyndham Buys Nashville Timeshares for $22M appeared first on Commercial Property Executive.