Why CRE Brokers Are Returning to Nashville
NASHVILLE-What’s going on in Nashville? Nashville turned my head recently when Beech Street Capital closed a $93 million loan on a multifamily portfolio followed by The Adler Fund’s joint venture to pick up Greenbriar Business Park for $12 million.
Just days earlier, I read that Holdings Inc. is readying to break ground on the 20-story West End Summit, a class A office project in Midtown Nashville. The expansion will generate 2,000 jobs in the next five years. And developer Ray Hensler launcheD his $80 million, 23-story condo tower nearby.
FelCor has decided it’s a strategic time to sell off its 296-room Embassy Suites near the Nashville International Airport. Meanwhile, P&M recently broke ground on a $4 million Nashville retail center and the 100 Oaks Mall got a new owner.
What’s going on in Nashville? Plenty, it seems.
Vacancy is falling on the office front—into single digits for the first time in 10 years. Cassidy Turley reports office vacancy has declined to 9.9% and class A vacancy hit a market low of 6.3% in the quarter. That could spark more new construction.
Even Nashville’s once-sluggish industrial market broke out in the third quarter with 1.2 million square feet of positive absorption. That brings market vacancy rate to 8.8%, according to Cassidy Turley, down from 11.7% in 2010.
And the multifamily market is as hot in Nashville as it is in many metro markets. Demand is high and vacancies are low. And an overall lack of new supply is driving healthy competition. As for Nashville’s hotel market, it’s mimicking national trends with rising occupancy and room rates and a construction rebound.
With all this, Nashville is suddenly the place to be for commercial real estate brokers. The Nashville Business Journal reports that Nashville real estate firms are hiring as the market rebounds—and that old and new faces are getting into the chase.
“Deals may be a little harder to get done, but the activity has most certainly picked up dramatically,” Todd Aleander, Southeast Venture’s director of brokerage services, told the Nashville Business Journal. “When that happens, typically, you are going to have more folks try to get into the business.”
What’s your take on Nashville? Beyond the healthcare sector, what’s driving the rebound in this southern city? And, brokers, are you seeing more competition, easier deal making? What’s your take on the near-term prospects for Nashville’s commercial real estate market?