Category Archives: CRE Outlook

Nashville’s Warner Parks deserve to be treasured

(This article originally appeared in the Tennessean on June 8, 2016)

21494541065_6d5ed96b09_b

In a city that’s quickly becoming more urbanized, Nashville is privileged to have one of the nation’s largest city parks— Percy Warner Park. The combined 3,100 acres of Percy Warner and its smaller and equally beautiful counterpart, Edwin Warner Park, compose America’s 19th largest park within a municipality.

The Warner Parks are one of Nashville’s greatest gems, granting residents access to luscious forests, hiking and cycling trails, picnic areas, scenic overlooks and much more.

In true Nashville style, the Warner Parks have only gotten bigger and better with time. In 2014, H.G. Hill Realty Company generously sold 250 acres of pristine old-growth forest, well below appraisal price, to Friends of Warner Park. The nonprofit turned the property — now called Burch Reserve — over to Metro for free, so that it could be used as an addition to Edwin Warner Park. I commend H.G. Hill for their generosity and efforts to preserve this valuable, unspoiled natural land.

Located north of Highway 100 across from Edwin Warner Park, Burch Reserve will extend Edwin Warner across the highway, and will include an underground pedestrian tunnel beneath the CSX railroad tracks. This new section of the park will be open to the public this fall.

H.G. Hill, along with Friends of Warner Parks, worked diligently to save from development this uninhabited land, which is considered one of the largest old-growth forests in an urban area in our region. Thanks to them, we will now be able to enjoy Burch Reserve’s native Tennessee wildlife and vegetation, such as oak and hickory trees, walnut trees and tulip poplars, for decades to come.

A true asset to Nashville, the Warner Parks provide a wide variety of things to do and see outside our small-big city. Boasting eight miles of bike trails and more than 10 hiking trails of varying lengths and skill levels, the Parks are a perfect place for a scenic afternoon ride or a sunrise run with friends. Percy Warner is also home to two public golf courses — the 18-hole Harpeth Hills Golf Course and the 9-hole Percy Warner Golf Course.

For the history buffs, the Warner Parks are listed on the National Register of Historic Places and are home to several Nashville landmarks. The Cedar Glen Spring House, the Hodge House and the World War I Memorial all tell great stories of Nashville’s past. The Allée/Belle Meade Steps are said to be the “front door” to the parks and make for a memorable and scenic climb.

Each year, Percy Warner Park is home to the iconic Iroquois Steeplechase, the nation’s oldest continuously run steeplechasing event — celebrating its 75th anniversary this year — and America’s second largest steeplechase race by size of purse. The races are run on a course in Percy Warner Park that was constructed by the Works Progress Administration in the 1930s.

More than 25,000 Nashvillians and tourists attend the Iroquois Steeplechase each year. And it’s all for a great cause. The event has raised more than $10 million for the Monroe Carell Jr. Children’s Hospital at Vanderbilt since 1981.

At the race or on the trails, the parks provide a place for the Nashville community to gather. Everyone is welcome to make use of this gift to our community — but, unfortunately, money doesn’t grow on trees. It is up to us, the residents of Nashville, to preserve this local treasure.

If you’ve ever enjoyed a hike, horse race, picnic or otherwise at Percy or Edwin Warner, I urge you to consider giving back through one of the parks’ many initiatives. Join beFRIEND Warner Parks, attend a Full Moon Pickin’ Party or volunteer your time at the Nature Center or on ParkWatch — your local parks and the Nashvillians of tomorrow will thank you.

###

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

Advertisements

Nashville proudly joins the NERDS crowd

(This article originally appeared in the Tennessean on April 25, 2016)

429871739_bdb9df5c37_oNashville has been dubbed one of the “NERDS” in 2016. An acronym standing for “Nashville, East Bay, Raleigh, Denver and Salt Lake City,” the NERDS were revealed in a recent report from Jones Lang LaSalle, a global professional services and investment management firm. These six cities are identified as hidden gems that have emerged in the market as up-and-coming hotbeds for innovation, expansion and population migration. It’s safe to say that Nashville is in good company!

The study takes an in-depth look at what makes each of the NERDS a rising star, comparing statistics among each city and against national averages. With nearly 1,500 people moving to Nashville each month and a record-breaking commercial real estate year in 2015, it’s not too surprising that Nashville made the list. Our city is booming.

The mass influx of new residents is supported by businesses’ desires to serve their needs. There were 37 business relocations and 117 expansions in the 2014-2015 fiscal year, according to the Nashville Area Chamber of Commerce. And thanks to a strong and steady economy, Nashville is positioned as a hub of innovation and entrepreneurship with a solid foundation to support growth for years to come.

Even though Nashville’s already earned its status as an “It-city,” the transformation has only just begun. In 2016, we can expect economic growth to the tune of $2.7 billion in capital investment dollars and 18,000 new jobs in Davidson County. It’s never been so cool to be a nerd.

Our largest industries, education and health services, provide jobs for nearly 200,000 people within city limits and another 200,000 in surrounding counties. And our largest employers, Vanderbilt University and the Vanderbilt University Medical Center, together employ more than 20,000 people. According to this research, Music City is very quickly earning a new title — Eds-and-Meds City.

Of course, this surge in our city’s growth is a huge boon to the commercial real estate market here. With over 120 cranes decorating our skyline at any given moment, and a multitude of projects on the horizon, the city’s built environment is changing rapidly and for the better.

There is one small caveat that accompanies rapid growth: high prices for both commercial and residential real estate. With all but 18.1 percent of the nearly 3 million square feet under construction already leased and a vacancy rate of less than 7 percent, prices won’t wane for the foreseeable future. The good news? A plethora of commercial and residential options outside of the city’s urban core are available for a fraction of the cost. There’s something for everyone in this city.

Looking ahead, I see Nashville’s inclusion in this study as a sign of promise and hope of what’s to come for our great city. There are new jobs being created. We are attracting well-educated and creative individuals. Our built environment is changing for the better to support this growth. I believe that through all of this, we will become stronger and more unified as a city, and that Nashville will remain the same little-big, or in this case little-bigger, city that it’s always been.

###

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

Past informs future development of Hillsboro Village

By Wood Caldwell

(This article originally appeared in the Tennessean on Feb. 22, 2016)

Once upon a time, Hillsboro Village was all there was.  Before 12 South, the Gulch, Germantown, East Nashville and other urban neighborhoods became hip (or, in the case of The Gulch, even existed as a neighborhood), the only place to experience a truly successful mixed use, urban environment was along 21st Avenue South between Capers and Acklen avenues. As time went on and more trendy areas emerged, however, the Village began to lose its appeal; popular businesses came and went.

hborovillageBut with changes like the sale of the former sites of Bosco’s and Sam’s Sports Grill and development of 2100 Acklen Flats, Hillsboro Village is poised to once again be one of Nashville’s most vibrant urban neighborhoods.

To see where the area is headed, take a look at where it came from. The property where Hillsboro Village sits today was originally owned by Adelicia Hayes Franklin Acklen Cheatham as part of the large Belmont estate. In 1890 it began to be subdivided into neighborhoods and kick-started the boom of streetcar suburban living in Nashville. By the early 1920s, along with the wave of residents moving to the area came a business district with five grocery stores — from mom and pop places like White’s Market to Southern chain stores like Piggly Wiggly and H.G. Hills stores — and bakeries and gas stations. The opening of the historic Belmont Theater in 1925 contributed to the bustling activity of the area.

More retail shops emerged along the strip in the 1950s and 1960s, however, most of these businesses have since gone to retail heaven —  except for Pancake Pantry, which has been a Hillsboro Village staple since it opened in 1961. In the 1980s and 1990s, with restaurateurs Randy Rayburn and Jody Faison at the helm, Sunset Grill, Faison’s and the Iguana and JoeD’s Chicken Club not only made the strip Nashville’s premiere dining spot (and the place to see and be seen), they also created what became known as “The Vodka Triangle.”

Development changes of the late 1990s were led by H.G. Hill Realty, developer of 2100 Acklen Flats. In 1997, H.G. Hill converted the northeast corner of the strip, centered on the famous Pancake Pantry, into mixed-use space for retail, residential and restaurant tenants. To boost the area’s already thriving development, Vanderbilt University met with land and business owners and developers to protect the character of the neighborhood and set boundaries on its own campus expansion.

The buildings along Hillsboro Village today keep the character of 60 years ago — even though some are newer buildings ­— because an Urban Design Overlay (UDO) was put in place in 1999. Stakeholders and the Nashville Metropolitan Planning Commissionestablished the UDO to outline regulations and best practices that must be followed by businesses coming into the area, requiring that an advisory committee review all proposed architectural changes. It encourages storefronts of varying heights and designs, parking lots behind the businesses and the continued presence of street parking and pedestrian access.

The preservation of this urban, pedestrian-friendly center in Nashville is just as important today as it was 17 years ago. Local developers are putting more money and energy into bringing the charm of Hillsboro Village back to relevance. With this growth, the neighborhood is primed to continue to be enjoyed for decades to come.

###

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.

2014 Middle Tennessee CRE Sectors Outlook

Survey: Retail tops the insiders’ list of the most promising sectors

(third of three posts)

This is our last post detailing the results of our CRE survey. Responders were asked to predict how each sector of Middle Tennessee commercial real estate would perform in 2014 compared to 2013.

Retail topped the list of commercial real estate sectors, with 83 percent of responders predicting that the retail sector will perform better or much better in 2013 than last year. Office (75 percent), land (71 percent), industrial (59 percent) and investments sales (52 percent) were also viewed as growth sectors, with a majority of responders expecting better or much better performances in 2014 compared to 2013.

Screen Shot 2014-01-24 at 2.55.52 PM

The multi-family and real estate-owned sectors enter 2014 less optimistically, with 54 and 78 percent, respectively, of responders predicting that these sectors would perform the same, worse or much worse than 2013.

Check out the 2014 Sales Outlook.

Check out the 2014 Leasing Outlook.

2014 Middle Tennessee CRE Leasing Outlook

Survey: A Banner Year in 2013 Stunts Sales Expectations This Year; Leasing Polls Strong

(second of three posts)

This is the second entry that outlines the results of a survey that we conducted of local and regional commercial real estate brokers, developers, building owners and investors. The survey asked responders to assess the mood of the marketplace in three categories: sales, leasing and sectors.

The first post talked about sales, this post will focus on leasing.

Commercial leasing polled much better than sales, with 72 percent of responders indicating that leasing will be better or much better than last year. This represents a 9 percent increase over 2013. In 2012, 74 percent of survey takers said that leasing would improve and 79 percent of responders thought that 2011 would fair better than 2010.

Screen Shot 2014-01-24 at 2.43.47 PM

New development opportunities, outside investment and relocations to Nashville were the primary reasons given for the commercial leasing predictions. One responder wrote, “New construction will force more leasing activity and tenants will take advantage of newer space.” Another added, “Attractiveness of area for relocations remains high.”

“It may have been more than a year ago that The New York Times coined Nashville ‘the nation’s “it” city,’ but that momentum has continued into the New Year,” said Todd Alexander, principal for Southeast Venture. “As long at the positive momentum continues, leasing activity will continue to grow, albeit likely more slow and steady.”

Seven percent expect commercial leasing to be worse in 2014, which remains relatively stable to 2013 and 2012 expectations of 6 and 8 percent, respectively. Across the board, low inventory was the reason given for negative and stagnant expectations.

2014 Middle Tennessee CRE Sales Outlook

Survey: A Banner Year in 2013 Stunts Sales Expectations This Year; Leasing Polls Strong

(first of three posts)

Last month we conducted our 4th Annual 2014 Middle Tennessee Commercial Real Estate Survey. Forty-two commercial real estate brokers, developers, building owners and investors took the survey, conducted by commercial real estate and design services company Southeast Venture, which gauged expectations about local sales, leasing and sector activity in 2014.

I am going to present the survey results here, in a series of three posts, beginning with the first category: Sales.

Sixty-two percent of respondents believe that sales of Middle Tennessee commercial real estate will be better or much better in 2014. Though this is slightly lower than previous years—down 4 percent over last year, and down from 64 percent positive responses in 2012—it still points to an overall sense of optimism within Middle Tennessee’s commercial real estate industry. Twenty-one percent expect sales to be stagnant in 2014 compared to 2013, and only 17 percent believe sales will fare worse.

2014sales

Nashville’s growth and national attention and the availability of commercial real estate financing were the top two reasons given for the favorable rating of commercial real estate sales.

Survey takers who foresee a stagnant or declining market this year point to the limited supply of available commercial real estate and the strength of the market in 2013. There will be “far fewer office transactions because several large, best in class A buildings sold in 2013,” one responder said. “Two-thousand-thirteen was just a very strong year,” another replied.

2013 Sectors Outlook

Survey: Office tops the insiders’ list of the most promising sectors

(third of three posts)

This is our last post detailing the results of our CRE survey. Responders were asked to predict how each sector of Middle Tennessee commercial real estate would perform in 2013 compared to 2012.

Sector Chart

Office topped the list of commercial real estate sectors, with 69 percent of responders predicting that the office sector will perform better in 2013 than last year. Retail and industrial sectors were also viewed favorably, with 56 and 53 percent expecting better or much better performances in 2013, respectively.

The sector with the most promise in last year’s survey, Multi-family (with 79 percent predicting a rise in 2012 activity), is mostly expected to remain the same in 2013, with 44 percent of survey takers predicting the same year-over-year activity.

Most responders believe that real estate-owned (56 percent) and land sectors (47 percent) will remain constant in 2013.

Check out the 2013 Sales Outlook.

Check out the 2013 Leasing Outlook.