Everyone Loses In The Controlled Economy Advocated By Affordable Housing Movement

By Wood Caldwell, Managing Principal at Southeast Venture

In order to keep up with the 80+ new people moving to Middle Tennessee every day (that’s over 30,000 a year, with a large portion of this influx coming to Davidson County), construction of apartment, condominium and mixed-use developments has hit record-breaking levels, and this boom must continue to in order catch up with demand. Indeed, the relatively high rental rates for apartments in some parts of Nashville are a function of this imbalance between supply and demand. When supply meets demand, rates will moderate. This kind of adjustment to reality is the beauty of a free market economy.

Unfortunately, there is a movement to control rents by exchanging development incentives for “affordable housing.” Let me say, everybody loses in a controlled economy. As stated before in other articles, it would be a “self-inflicted recession.” This is Nashville’s future if such a plan prevails.

Should everyone who puts in a good day’s work be able to afford to live in our city? Certainly, and there is plenty of moderately priced housing in Nashville already. Is it in the hip neighborhoods like downtown, East Nashville, Sylvan Heights, Germantown or 12 South? No, yet this is what this movement demands.

But why? Is this really a noble cause? Isn’t it rather like demanding that all Nashvillians who drive a late model Chevrolet be upgraded to a Cadillac at public expense? Is this something we should raise property taxes to pay for? It is worth harming our city’s economy?

The latest salvo in the affordable housing “crisis” is a proposed ordinance from the Metro Planning staff, mandated by Metro Council, which seeks to enforce affordable housing quotas by taking away certain key incentives from developers unless a certain number of units in their residential projects are rented or sold at below-market rates. Currently, developers are allowed to build taller buildings by adding floors when their projects include characteristics like public parking, eco-friendly design or mixed-use ground floor elements such as retail and restaurants.

Therefore, height bonus equals needed downtown public parking, “green” designed buildings and mixed use projects: key elements essential for creating a vibrant downtown. It’s a win-win. The irony of this proposal is that it was the Metro Planning Commission and Metro Council that voted to incorporate these bonuses years ago to stimulate development and bring people back downtown.

This ordinance now goes to Metro Council for consideration. Hopefully, they will vote it down, just as the Planning Commission voted unanimously not to recommend it to the Council. This ordinance’s heavy-handed approach to forcing the development of below-market housing will have the unintended consequence of severely slowing development of residential real estate throughout Nashville. Everyone loses.

It’s also worth noting that nowhere in the ordinance is there anything about paying for this plan – even though the planning staff’s report estimated it would cost $10 million a year to compensate property owners for the money lost due to “affordable housing” quotas. Where is this $10 million coming from? This obviously means a tax increase. Either that, or cutting funding to other city services like education and public safety.

Again I ask, is this a sacrifice we want to make so that people can move from affordable housing in Antioch or Madison into a place they can’t afford in downtown or East Nashville? Is it really that important for our city to subsidize a hip lifestyle for everyone? Surely we have more pressing issues.

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Southeast Venture Brokers Sale of Historic Hillsboro Village Property to Elmington Capital Group

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This press release was originally released on Feb. 4, 2016

Southeast Venture Brokers Sale of Historic Hillsboro Village Property to Elmington Capital Group

Property at 1803 and 1805 21st Avenue South date back to 1920’s

NASHVILLE, Tenn. February 4, 2016 — An historic Hillsboro Village property that dates back to the 1920’s and formerly housed Bosco’s brewpub and Sam’s Sports Grill has been purchased by Nashville-based Elmington Capital Group for $8.3 Million.

The property is composed of two adjacent buildings at 1803 and 1805 21st Ave. S. The .91-acre site is in the heart of Hillsboro Village and includes a 60-space parking lot and a .16-acre vacant lot, both in the rear of the building.

“We are excited about the opportunity to contribute to the revitalization of Hillsboro Village,” Elmington Capital Group CEO Cary Rosenblum said. “As not only owners but neighbors as well, we look forward to being a part of both the conservation and transformation of this historic part of Nashville.”

Southeast Venture brokered the deal on behalf of both the buyer and the seller. James Roscoe High, CCIM, represented the buyer, Elmington Capital. Wood Caldwell, Managing Partner, and Jon Petty, CCIM, represented the owners of the property, one of whom is Buckhead Investments.

“I couldn’t think of a more perfect buyer for this property,” said Southeast Venture’s James Roscoe High, CCIM. “Elmington Capital views this as generational real estate. They are committed to maintaining the legacy and integrity of the buildings while finding tenants that will complement Hillsboro Village.”

About Southeast Venture

Founded in 1981, Southeast Venture is a diversified commercial real estate and design services company guided by a mission of “Building Value by Valuing Relationships.” The firm provides and coordinates the delivery of brokerage, development, architectural and interior design and property management. This unique, comprehensive approach to commercial real estate offers a cost effective and efficient way of meeting its clients’ commercial real estate needs. For more information, visit SoutheastVenture.com, or find Southeast Venture on Twitter @SEVentureCRE.

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Don’t create new agency for affordable housing fund

(This article originally appeared in the Tennessean on Dec. 21, 2015)

For Nashville, becoming an “it” city has come with its fair share of growing pains. Since 2000, average housing costs in our city have risen more than 100 percent. The good news for current and future Nashvillians is that we’ve identified the most important housing needs — and we’re working to address them.

12229041713_ec4d0b4685_nHousing affordability is key to any city’s continued growth and vitality. The Planning Department, under the leadership of Executive Director Doug Sloan, is making great strides in identifying solutions to this issue and continues to tackle the task with great care and efficiency.

The department, with the help of an outside consultant, conducted an extensive feasibility study to help guide the city as it considers new regulations to keep housing affordable for all residents. As a member of the Stakeholders Committee, I am one of 50 industry and community leaders tasked with helping Nashville navigate this unprecedented period of growth in the housing market. Recently, the department held a meeting with the Metropolitan Planning Commission and the Stakeholders Committee to discuss the study findings and offer recommendations as to how we might best address the rising cost of living in our city.

The commission’s recommendation calls for approximately $10 million per year to expand the services of The Barnes Fund for Affordable Housing. The fund, created by former Mayor Karl Dean and the Metro Council in 2013, provides assistance to low-income residents seeking affordable housing in Davidson County. With the recommended increase in capital, the fund would become an independent agency, with a limited portion of dollars dedicated to administration and the remainder going directly to the program. As an agency, the fund would be reauthorized as a community land trust, enabling it to acquire and develop land for affordable housing, own and operate that housing and maintain and administer financial assistance programs.

While I firmly stand behind the use of the Barnes Fund to alleviate rising costs, there is no need to create another independent agency. We should instead pass control of this funding over to Nashville’s present housing authority, the Metropolitan Development and Housing Agency (MDHA). The current staff and board of the MDHA are the best the authority has ever seen, and they are the best choice for the job.

The MDHA is also already heavily involved in revitalization projects similar to those for which the Barnes Fund probably would be used. One example is Envision Cayce. Since 2013, the MDHA has worked with EJP consulting group, community partners and Cayce Place residents to establish a master plan for revitalizing the 716 public housing units called Cayce Place. In addition to rebuilding the initial 716 homes, they also are adding 2,390 new homes and apartments — 42 percent designated for low-income families, 15 percent for moderate-income families and 43 percent for households able to afford market rates.

Developments like Cayce Place are vital to maintain balance in our growing city, and the MDHA has done an exemplary job in creating this project. With its guidance and leadership, the funding recommended by the Planning Department’s study would vastly improve the state of affordable housing in Middle Tennessee.

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Wood Caldwell is managing principal of Southeast Venture, a diversified commercial real estate company. He writes about Middle Tennessee commercial real estate issues once a month for The Tennessean. Reach him at wcaldwell@southeastventure.com.

Quorum Health Resources Leases Mallory Park Building Developed by Southeast Venture

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This press release was originally released on Nov. 24, 2015

Quorum Health Resources Leases Mallory Park Building Developed by Southeast Venture

 Quorum Health Resources moving headquarters from  Maryland Farms into new Mallory Park buildings

 NASHVILLE, Tenn. November 24, 2015 — Quorum Health Resources, a subsidiary of Community Health Systems, has signed a lease for the second of two buildings in Mallory Park being developed by Southeast Venture. In September, Mallory Park was announced as the future headquarters of Quorum Health Corporation, the previously announced spin-off of Community Health Systems that will include 38 affiliated hospitals and Quorum Health Resources, a leading hospital management and consulting firm. Quorum Health Resources, will relocate from its current offices in Maryland Farms to occupy the second building when construction is complete.

An 8,435-square foot connector will join the two 39,000-square-foot buildings. Construction on the connector is expected begin in March 2016 and will be completed in the summer of 2016. The connector will serve as the main entrance for the buildings, and will include a conference center.

The first building is slated for an early 2016 move-in date. The tenant build out of the second building will begin in February 2016, with an expected move-in date during the second quarter of 2016. The connector joining both buildings is scheduled for a July 2016 completion. Upon completion, Quorum will occupy 100 percent of the 87,100-square-foot project.

“Quorum Health Resources’ relocation to Phase I of Mallory Park will facilitate a combined office complex in a convenient location for the new company,” said Southeast Venture Principal Cam Sorenson. “Quorum brings significant economic development to this area and we are happy we can accommodate their needs.”

Brokers Bo Tyler and Tom Hooper of Jones Lang LaSalle represented Community Health Systems in the deal. Michael Finucane and J.C. Darby represented Southeast Venture.

July 2016 will mark the completion of Phase I of Mallory Park. Phase II will break ground Spring 2016 and will include 78,000-square-feet of speculative office space. Like Phase I, it will include two office buildings with a high parking ratio of six spaces per 1,000-square-feet.

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 About Southeast Venture

Founded in 1981, Southeast Venture is a diversified commercial real estate and design services company guided by a mission of “Building Value by Valuing Relationships.” The firm provides and coordinates the delivery of brokerage, development, architectural and interior design and property management. This unique, comprehensive approach to commercial real estate offers a cost effective and efficient way of meeting its clients’ commercial real estate needs. For more information, visit SoutheastVenture.com, or find Southeast Venture on Twitter @SEVentureCRE.

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100 years of change: What would Captain Ryman think?

by Wood Caldwell

(This article originally appeared in the Tennessean on Nov. 24, 2015)

RymanNashville’s built environment is changing rapidly, and largely for the better, I believe, and I think that the man behind our most famous historic building would agree. If he were alive today, I believe that Captain Thomas Ryman, namesake of Ryman Auditorium, would look over downtown Nashville from his beautiful home on Rutledge Hill and be thrilled.

A very successful businessman with a reputation for doing the right thing, Captain Ryman is a perfect example of the kind of people who have built our city into one of the most desirable in the world. People who aren’t afraid of success, but are equally courageous in their willingness to embrace a vision bigger than themselves.

Ryman began his career at the age of 24 when his father left him a fleet of fishing boats after he passed away. The Cumberland River was plentiful with fish, and Ryman made such good money that he was able to purchase his own steamboat two years later. Within 20 years, Ryman owned over 30 steamboats, and was the superintendent to two of the three steamboat lines in Nashville.

In the late 1800s, Ryman purchased several plots of land on Rutledge Hill for less than $5,000 and built a large, two-story Queen Anne-style home that he and his family occupied for more than 40 years. The home overlooked the Cumberland River so Ryman could keep tabs on his fleet and his wife could see his boat come in when Ryman was out on the water.

Though Ryman’s home is long gone, it’s interesting to see how the development of Nashville has drastically changed the view from where the home once stood. During the time the Ryman family occupied their Rutledge Hill home, from 1885 to around 1925, the Cumberland River Wharf was a hub of commerce in the Southeast, and the Rymans had a front row seat. If Captain Ryman were to look out from one of his two towers today, he would no longer see boats lining the wharf, but instead, Riverfront Park. It’s likely that he could even listen to a concert at Ascend Amphitheater from his porch — which is appropriate, since Nashville’s musical renown was birthed from the tabernacle he built.

Ryman could also enjoy coveted views of the Nashville skyline, including the Pinnacle Building, Omni Hotel, the Music City Center, the Korean War Veterans Memorial Bridge and the AT&T “Batman” building. Assuming he was a football fan (and he would be, of course), his house would be the perfect place to host a Titans tailgate before walking to Nissan Stadium over the John Seigenthaler Pedestrian Bridge — all visible from his front porch.

What he might be more proud of, though, is that Nashville continues to embody his giving spirit. We were named one of the top 10 philanthropic cities in the U.S. in 2014, according to a report by The Chronicle of Philanthropy. Ryman used his money and influence to build the Union Gospel Tabernacle so that people of all faiths would have a free place to convene and worship. Renamed Ryman Auditorium after his death in 1904, the building may be even more popular today than it was in the 19th century — and can still be seen from the location of Ryman’s family home.

I think Captain Ryman would proud of the development of Nashville, happy to live in our great city and honored that his spirit of giving is still manifested through efforts today.

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Wood Caldwell is managing principal of Southeast Venture, a diversified commercial real estate company. He writes about Middle Tennessee commercial real estate issues once a month for The Tennessean. Reach him at wcaldwell@southeastventure.com

Photo: TN Media

Welcome to the team, Brett

Brett DowneyHave you heard? Southeast Venture has added Brett Downey to our design services team. Downey joins us from the University of Tennnessee at Chattanooga where he graduated with a B.S. in interior design. While at UTC, he honed his skills at Artech, an architectural firm in Chattanooga, TN, as an intern. Downey is currently working on Eastside, a multifamily community in East Nashville.

Southeast Venture and Hardaway Construction Close on First Joint Venture: EastSide Heights Apartment Complex

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This press release was originally released on Oct. 30, 2015

NASHVILLE, Tenn. October 30, 2015 — Southeast Venture and Hardaway Construction announced today that they have closed on a 2.19-acre property in East Nashville that will be home to a new multifamily development, EastSide Heights.

This is the first joint venture between Southeast Venture and Hardaway Construction. Southeast Venture is handling the design of EastSide Heights, while Hardaway Construction will lead construction efforts. The project will break ground Mid-November and is expected to finish Summer 2017.

“It’s no secret that East Nashville is exploding,” said Tarek El Gammal, principal at Southeast Venture. “Over 3,000 new jobs have been created recently within a mile of EastSide Heights and East Nashville is one of the city’s hottest restaurant scenes. All it’s lacking is enough high quality residential options. We believe that EastSide Heights will perfectly meet this need – and we have teamed up with the perfect builder to make it happen. In addition to an extensive portfolio of multifamily projects to its credit, Hardaway’s corporate headquarters are only a few blocks from this project. No other contractor is as qualified to build East Nashville’s marquee apartment complex. We are excited about this joint venture.”

Located at the corner of 5th Street and Woodland Street, EastSide Heights will be a Class A multifamily community with 249 one- and two-bedroom apartments and 8,000 square feet of ground floor retail space. The five-story building will offer tenants several amenities, including a resort-style swimming pool with in-pool sun deck, two landscaped courtyards, pet spa and dog walk, fitness and yoga facilities, cyber café, a 2-level sky lounge with outdoor patio and a stunning view of downtown Nashville – plus a multi-level parking garage that allows residents to park on the same level as their apartment is located.

“We are excited about this mixed-use project and teaming with Southeast Venture to bring it to our East Nashville neighborhood,” said Stan Hardaway, president of Hardaway Construction. “We couldn’t have chosen a better partner or project for our first joint venture. East Nashville provides walkability and livability that make it a top location for new residents looking for homes in the city, and this project will bring much desired housing to the area.”

About Southeast Venture

Founded in 1981, Southeast Venture is a diversified commercial real estate and design services company guided by a mission of “Building Value by Valuing Relationships.” The firm provides and coordinates the delivery of brokerage, development, architectural and interior design and property management. This unique, comprehensive approach to commercial real estate offers a cost effective and efficient way of meeting its clients’ commercial real estate needs. For more information, visit SoutheastVenture.com, or find Southeast Venture on Twitter @SEVentureCRE.

About Hardaway Construction

Hardaway Construction Corp., a third generation, family owned construction firm has been serving the construction needs of Nashville and the Southeast for 91 years. Notable local projects include the Tennessee Bicentennial Mall, Gaylord Opryland Hotel & Convention Center, Belmont University Curb Event and Beaman Student Life Centers, Metro Nashville & Davidson County Historic Courthouse Renovation, and the Vanderbilt University Freshman Commons Dining Center and School of Engineering.

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