Infrastructure Work Begins at Brentwood’s ‘Flagpole Property’

Area will add 35 acres of available commercial property

This week marks the official beginning of Mallory Park Phase II development. Infrastructure work at the historically dubbed ‘Flagpole Property,’ so named for several flagpoles that could be seen along the Highway 65 corridor in Brentwood, commenced Monday. Approximately 300 feet of road will be added as well as water and sewer systems, opening up about 35 additional acres for commercial development.

The property is C3 zoned and allows for warehouse, showroom space and office spaces.We will develop only about 35 acres. The nearly 24 acres of remaining land will be used for two parks, one which is contiguous to Mallory Park.

The area shaded dark pink represents Phase II

In June 2010 the Brentwood City Commission approved rezoning that allowed for the extension of the Mallory Park business park and the creation of a new city park.

The park property is in two parcels: 15 acres are bounded by Wikle Road and the CSX Rail Line and 8.7 acres adjoin Mallory Park Phase II on the north, acting as a buffer between the business park and the adjacent residential neighborhood on Gen. MacArthur Drive

Last month, Sonic Automotive Group broke ground on a new 9,178-square-foot Porsche dealership and 32,010-square-foot Audi dealership at 1576 and 1580 Mallory Lane. The new Porsche of Nashville and Audi Nashville are located where Phase I of Mallory Park connects to Phase II. Construction is supposed to last about a year.

One More 2010 Look Back and 2011 Outlook Blog Post

Last week, CoStar Group posted a lengthy article about CRE industry professionals looking back to 2010 and forward to 2011. You can read the whole article, titled “Anyone Sorry To See 2010 Go? Hell No!,” here.

In reading the piece, I was presently surprised that it wasn’t simply a rehashing of the red giant of a year 2010, but rather a semi-statistical, optimistic look at 2011.

According to CoStar, this time last year the CRE industry was mostly reading doom-and-gloom articles about the upcoming 12 months. This year, we seem more interested in “half-full” assessments.

The stories getting the most reads in January and February 2010 were markedly downbeat.

• Betting on Bad Debt Becoming a Growing Investment Play
• CRE in 2010: Weak Fundamentals and Constrained Liquidity
• Risky CRE Lending Deadly for Banks
• Movie Gallery Files Bankruptcy, Closing 800+ Stores
• Capital Market Recovery Will Take Time
• Distressed CRE Assets Jump 15% at Nation’s Banks
• Shopping Center Receiverships and Foreclosures Usher in New Year

The stories getting the most reads in last two months were more longingly hopeful.

• Have Commercial Real Estate Prices Bottomed Out?
• Has the CMBS Market Finally Turned the Recessionary Corner?
• Google Acquires One of NYC’s Largest Buildings for $1.8B
• REIT Execs Hail Rally
• U.S. Multifamily Market Strengthens in Third Quarter on Rising Demand, Falling Vacancy
• Falling Retail Rents Mean More Store Openings
• Surge in Growth at Apple Prompts 100-Acre Cupertino Acquisition

The article also includes 2011 CRE outlooks that were sent in by CoStar readers. The most interesting of which for Nashville may be the assessment of office and industrial vacancies.

Office, Industrial Vacancies Near Peaks

The U.S. office market vacancy rate is expected to slowly decline over the next two years, falling to 16.4% by the end of 2011 and to 15.3% by the end of 2012, according to analysis from CBRE Econometric Advisors (CBRE-EA). CBRE-EA forecasts that the office vacancy rate will peak in second quarter of this year at 16.8%, up from the 16.6% level at third quarter.

“The recent increase in leasing is a step in the right direction but activity is uneven across markets and generally tenant footprints are not increasing,” said Arthur Jones, senior economist of CBRE-EA. “Since office space is the ‘economy in a box,’ continued job growth is key to the market’s ongoing recovery.”

The U.S. industrial real estate sector’s national availability rate is expected to fall to 13.1% in 2011, down from 14.% in the third quarter of 2010, according to CBRE-EA, which forecasts that the industrial availability rate is expected to continue declining during 2012, ending the year at 11.8%. The national industrial availability rate peaked at 14.1% in the second quarter of 2010.

With Nashville’s office vacancies down to 13.2% at the end of 2010, and industrial vacancies up to 11.7%, it’s good that we’ve beat national averages on both fronts, but we need to continue to whittle away at office vacancies and get industrial vacancies under control in 2011.

Am I sorry to see 2010 go? A little bit. It’s been a year that went better than expected, witnessing the HealthSpring expansion and groundbreaking and the “flagpole property” deal.

But, I too am cautiously optimistic about 2011. Here’s to breaking expectations two years in a row.

We Made Brentwood’s Top 10 Stories of 2010

Yesterday, Brentwood Home Page posted its roundup of the most read stories of 2010. Southeast Venture made #6 with our work with the “flagpole property.”

Quoting from the article,

“On April 14,  over 40 residents attended an informal meeting to hear a “Plan C” for the property. The new plan, presented by Southeast Venture principal Wood Caldwell,  included commercial development of 33.5 acres; the deeding of a total of 23.7 acres to the city for eventual park/open space use, and another 20.2 acres to buffer the commercial development from adjoining neighborhoods.

On June 28 with a unanimous vote, the Brentwood City Commission passed three ordinances that comprised Plan C.”

Tennsco donates 24 acres to Brentwood for park

The city of Brentwood has another 24 acres of parkland thanks to Tennsco, which owns the adjoining property known as the “flagpole property.”

20+ Acres Donated to City of Brentwood for New Park

Nearly 24 acres of land in the Wikle Road/ Gen. McArthur Drive neighborhood was deeded to the City of Brentwood last Thursday for use as a new city park.

The land was donated by Tennsco, which also owns 33.5 nearby acres, known as the “flagpole property,” that the Brentwood City Commission voted in June to rezone as commercial. Mallory Park business park will be extended into the rezoned property.

The donated park property is in two parcels: 14.99 acres is bounded by Wikle Road and the CSX Rail Line and 8.7 acres adjoins the extended Mallory Park property on the north. The 8.7 acres will act as a buffer between the business park and the Gen. MacArthur Drive residential neighborhood.

“I am appreciative to Tennsco for the donation of this valuable land for an additional city park.   The inclusion of even more green space in the form of larger residential buffers was also significant.” said Brentwood Mayor Betsy Crossley. “Now, we look forward to incorporating neighbors’ ideas into the future plan of the newly acquired park.”

Wood Caldwell, of Southeast Venture, which represents the landowner, said that the new parkland should offer several benefits.

“Municipal green space is always a great amenity for a city, and I believe this is particularly true for Brentwood. Beyond the natural beauty of a park, in this case it also serves as an excellent transitional buffer between residential neighborhoods and a commercial area. It’s an excellent example of forward-thinking city planning.”

City Commissioner Regina Smithson, who participated in the unanimous vote by the Brentwood City Commission to accept the parkland and rezone land to extend Mallory Park, said that the donation of 20-plus acres for a city park is part of a “win-win-win situation.”

“I want to thank Tennsco and Wood Caldwell for working with the neighborhoods surrounding the “flagpole” property and with the City of Brentwood to come up with a win-win-win situation,” she said. “The city now has additional parkland in the area that was much needed, plus more commercial tax revenues from the 33 acres of commercial property.  The developer gave some, the city gave some and the neighbors gave some.  In doing so, they ALL received more.  Just about everyone was pleased and when the project is complete, I believe Brentwood will be an even better place to live. This is proof that developers, residents and government can work together for the good of all.”