Nashville Area Real estate to continue to boom

[smeagolsfree]

Just a thought, but I expect to see another office building go up in downtown Nashville in the next year or so. I don't know anything, its just a hunch as we watch the area office space continue to grow and get filled.

In todays Tennesseean.

http://tennessean.com/apps/pbcs.dll/articl...ESS01/512020394

[Hankster]

That's a very positive article which supports the prospects of future constuction, especially office, in downtown Nashville. A million and a quarter square feet net positive absorption in office space next year on top of 900,000 this year are astounding numbers. That could translate into not just one, but several new office towers in the next couple of years. I was hoping that we could get a balance of new office, retail and residential construction in Nashville, not just residential and retail. This article gives me hope that that will indeed be the case.

[Lexy]

Hank, good post my friend. You explain my feelings on this to a tee. I think this speaks volumes for Nashville and the entire metor area.

[Onyte9]

I hope you guys are right but I dont think I'm gonna hold my breath. It seems like Palmer is having a hard time finding a tennant and I imagine Tony G was having a hard time finding a tennant for his first Sig tower. I believe a new office tower will come eventually but I think it may be 7-10 years away. I hope I'm wrong. Maybe I am, maybe we explode like A-town.

[sleepy]

That's a very positive article which supports the prospects of future constuction, especially office, in downtown Nashville. A million and a quarter square feet net positive absorption in office space next year on top of 900,000 this year are astounding numbers. That could translate into not just one, but several new office towers in the next couple of years. I was hoping that we could get a balance of new office, retail and residential construction in Nashville, not just residential and retail. This article gives me hope that that will indeed be the case.

1,250,000 sq. feet is certainly a great number. What's the Batman building? 600,000?

It would be nice if some of that would be downtown as highrises and not 30 three story buildings in the office parks.

In perspective, I look at the Sears Building in Memphis which is 1,360,000 sq. ft.--the largest building in the state--and is apparently underway for redevelopment. As Nashville's economy is generally better than Memphis', I wonder how realistic those redevelopment plans are. Of course, it's not going to be all office footage.

[Hankster]

I hope you guys are right but I dont think I'm gonna hold my breath. It seems like Palmer is having a hard time finding a tennant and I imagine Tony G was having a hard time finding a tennant for his first Sig tower. I believe a new office tower will come eventually but I think it may be 7-10 years away. I hope I'm wrong. Maybe I am, maybe we explode like A-town.

That's been my concern too...that both AS Palmer and Tony G have had trouble getting an office building going. However, this info gives me hope that we're right at the cusp now, not 7-10 years from now, of seeing office construction gaining momentum in Nashville.

I can't help but wonder whether Nissan would have located downtown had a fancy new spec office tower existed in downtown Nashville, accompanied by an aggressive campaign by Purcell. I can't help but believe that some of this suburban development that is currently taking place could be happen in Nashville if aggressively sought after by the city.

[Lexy]

I can't help but believe that some of this suburban development that is currently taking place could be happen in Nashville if aggressively sought after by the city.

That has been my gripe all along. IS Nashville pushing hard enough to get the business downtown, or are they just "letting" go to Franklin?

My assumption with Alex Palmer is that he (the company) did not market the building enough to prospective tennants. I am sure that a tennant could have been found, had the marketing been there. It takes more than a little on his website and some billboard on the side of the street at the tower's site. i would seriously take a look at the real estate core of the team and ask them, "is this the best?"

Now on the other hand, it may have been THAT hard to find someone. Who, outside the company, really knows? I seriously believe that the city had something to do with Tony's Signature Tower becoming an all condo tower. I don't believe that the city felt another office tower should happen until we get a certain amount of residents in the core. Signature Tower was the perfect candidate for that. Tony saw no problem with it and went with the change. City Center II seemed to be doomed from the start, but it could have been marketed to the State of Tennessee government. Instead, they (the government) spread a number of offices out in the Metro Center office park and City Center is a dead proposal now. It's all aobut marketing and selling. If you don't have people that can steal the other mans thumder inreal estate, you will get burned every time. Sometimes it's about being the first on the scene, not the last or not at all. See what I am saying?? LOL!!

[ricky_the_great]

1,250,000 sq. feet is certainly a great number. What's the Batman building? 600,000?

It would be nice if some of that would be downtown as highrises and not 30 three story buildings in the office parks.

In perspective, I look at the Sears Building in Memphis which is 1,360,000 sq. ft.--the largest building in the state--and is apparently underway for redevelopment. As Nashville's economy is generally better than Memphis', I wonder how realistic those redevelopment plans are. Of course, it's not going to be all office footage.

ya, in fact most if it is not going to be office.

[it's just dave]

Its amazing that the office leasing has picked up around Nashville so much. 1.25 million is a hefty number. Retail wise, just off the top of my head, with Sumner, Indian Lake, Harpeth, H.G. Hills, Providence, you're looking at 3-4 million sq. ft of new retail in just those projects. And there's much more. Most of this is happening because of population surges and the fact that the Nashville retail market boasts one of the lowest vacany rates nationwide.

Industrial space leasing hits almost 4 million. That kind of growth is hard to deny. Add to that massive numbers in residential, and we're doing okay.

One thing I saw this morning that was quite cool. The tower crane in front of the Courthouse Plaza (and that blasted fence) came down. At the exact same time, the tower crane for Suntrust was being assembled. It was amazing site.

I'm also digging the new Church Street. It seems to have come alive in the past couple of days. Even on a cold, rainy day, there were people out this morning.

[ATLBrain]

I personally think that the timing will work in Palmer's favor. We'll soon see if that's right.

So ASP could get his building up within 3 years and have it leased up in 2008-2009. Meanwhile, Giarratana is getting Signature out of the ground. Then sometime after that, he can concentrate on his project at Church in the gulch. My pal at Vandy has heard rumors that he wants to go taller than Signature there with multiple buildings.

[smeagolsfree]

One thing I saw this morning that was quite cool. The tower crane in front of the Courthouse Plaza (and that blasted fence) came down. At the exact same time, the tower crane for Suntrust was being assembled. It was amazing site.

Hey Dave, You must have been downtown early this morning. I got into town about 4:30 and noticed a lot af activity. Its good to see two BIG cranes next to each other.

[doormanpoet]

Remember, Suntrust Plaza at 13 stories and 200 feet is 75 million dollars! Another major office tower will be well over 100 million dollars. Lets not get our hopes up. IMHO we will see a 15 to 20 story office tower, probably a regional headquarters for a major firm or corporate entity.

Downtown parking for the average worker is VERY expensive. One advantage to working in suburban office parks is free parking, restaurants, micro hotels for visiting clients at resonable rates, and large campuses for recreation, walking, and even picnicing at lunch time. Years ago when I worked in Maryland Farms and then Cool Springs, employees were walking and having outdoor actitities while at lunch or break.

I am not defending large office parks, but to the average worker, they don't want to pay for parking, and they are afraid of crime in the city.

BTW, I met with a Hastings architect and here are the official specs for the Suntrust Plaza Tower:

Lobby Floor: 15 feet ceiling

Floors 2-12: 13 foot ceilings

Penthouse: 13 foot ceiling (no 13th floor)

Cap with logo: between 15 and 20 feet

Estimated Height 193 to 200 feet. Slight possibility it could reach 225 feet if changes are made to the cap or if by chance, and very slight chance a floor is added.

[Lexy]

One thing I saw this morning that was quite cool. The tower crane in front of the Courthouse Plaza (and that blasted fence) came down. At the exact same time, the tower crane for Suntrust was being assembled. It was amazing site.

I will document the new tower crane with some pics on Tuesday. Has anyone heard about when the foundation work is to start on ICON or the Adelicia???

[ATLBrain]

My assumption with Alex Palmer is that he (the company) did not market the building enough to prospective tennants.

My buddy at Vandy's development office tells me that Palmer can't get the financing he needs. Not surprisingly, institutional investors want to see some preleasing. It doesn't look like he has it. Meantime, Franklin keeps stealing Nashville's future.

[Lexy]

^ I think he really sold himself, and the tower, short this time. What a shame. Either way, if he builds something, great. If he doesn't, then the lot is open for anyone else with the right fortification to do something there if the price is right. I think it could be a win-win for the area regardless of what happens. I would rather have a short building that is FULL than a tall one that is empty.

[smeagolsfree]

Here is another article from the NBJ that will be of interest to all:

http://www.bizjournals.com/nashville/stori.../05/story7.html