NASHVILLE | Development Showcase

[downtownNashville]

Originally Posted by Innsertnamehere

Why does Nashville need an indoor stadium? Even Buffalo isn’t building and indoor facility.

Nashville is chasing a Super Bowl, Final Four, and CFB Playoff as possible events for the new stadium, and the climate is not warm enough for those events during the winter / early spring.

[Texcitement]

Station East is the latest new multi-tower project announced for the East Bank adjacent to the new Titans dome.

Courtesy Nashville Business Journal: https://www.bizjournals.com/nashvill...elcenters.html

Renderings and video courtesy of RMR & Hastings: https://rmrnashville.wpengine.com/#leasing

[nashvilleron]

Originally Posted by Texcitement

Station East is the latest new multi-tower project announced for the East Bank adjacent to the new Titans dome.

Courtesy Nashville Business Journal: https://www.bizjournals.com/nashvill...elcenters.html

Renderings and video courtesy of RMR & Hastings: https://rmrnashville.wpengine.com/#leasing

Thanks for beating me to this as I just posted all of the renderings on THE OTHER site I belong to. I was also helping getting it live on the Post as well.
I was wondering when our next hit would come. I think things will slow some as money is starting to tighten quite a bit from what I am hearing talking to folks in the development industry. I think the land speculation is done for a bit as well. I know of a few lots that have come down in price.....

[jmecklenborg]

Originally Posted by nashvilleron

I think things will slow some as money is starting to tighten quite a bit from what I am hearing talking to folks in the development industry. I think the land speculation is done for a bit as well. I know of a few lots that have come down in price.....

I was in town for the holiday and a friend told me that he knows someone who listed a flip in early October (I'm not sure of the neighborhood or price) and it hasn't had a single showing or offer.

If credit starts really tightening, or seizes up as it did in 2008, you will see people who can't finish projects. Even for flips, if a flipper's credit card shuts down his account, they're finished.

I remember back in 2008 having all of my credit cards except one proactively closed. I had no balance and I had never made a late payment, but poof, away they went.

[Texcitement]

I've already seen the pullback. I'm with a R/E development firm and we've canceled several large projects already, with prospects for delaying others indefinitely. Yes, the interest rates are rising, but the crux of the matter is the cost of energy. It's already 2X over the past 20 months, and our firm is bracing for another doubling of gasoline in the
next 18 months unless demand drops, and it very likely could with a recession looming. Everyone knows that diesel is higher than ever, but heating oil in major population centers is up to 3X higher for many residents. Restricted energy production is not sustainable to keep an economy humming.

[jmecklenborg]

Originally Posted by Texcitement

I've already seen the pullback. I'm with a R/E development firm and we've canceled several large projects already, with prospects for delaying others indefinitely. Yes, the interest rates are rising, but the crux of the matter is the cost of energy. It's already 2X over the past 20 months, and our firm is bracing for another doubling of gasoline in the
next 18 months unless demand drops, and it very likely could with a recession looming. Everyone knows that diesel is higher than ever, but heating oil in major population centers is up to 3X higher for many residents. Restricted energy production is not sustainable to keep an economy humming.

Yeah the diesel prices are ridiculous. It's a bit mind-bending for those of us who remember diesel fuel always being a nickel or dime cheaper than gasoline.

There are still tons of cranes above Nashville and new projects breaking ground. On Sunday I passed the foundation prep work for this tower across from Green Hills Mall:
https://nashvillenownext.com/2022/02...m-hill-center/

[cecilism]

Originally Posted by nashvilleron

Thanks for beating me to this as I just posted all of the renderings on THE OTHER site I belong to. I was also helping getting it live on the Post as well.
I was wondering when our next hit would come. I think things will slow some as money is starting to tighten quite a bit from what I am hearing talking to folks in the development industry. I think the land speculation is done for a bit as well. I know of a few lots that have come down in price.....

Man this economy has really gone downhill over the past couple of years hasn't it?

So much so that it has finally affected the real estate industry. Maybe the economy will right itself and the current economic disaster will then be left behind.

[Dale]

I don’t doubt that rough(er) times are ahead. But it is interesting to me that Nashville thread is the only thread where this has become a topic of concern. Is concerned heightened due to Amazon cutbacks ?

[BnaBreaker]

Originally Posted by cecilism

Man this economy has really gone downhill over the past couple of years hasn't it?

So much so that it has finally affected the real estate industry. Maybe the economy will right itself and the current economic disaster will then be left behind.

I have no doubt that in your mind the state of the economy immediately went from 'great' to 'terrible' the very second the current administration took over and that this is somehow all their fault exclusively. But in actuality, by most metrics, the economy has been outperforming post-pandemic expectations over the last couple of years. But it is obviously true that high costs due to a multitude of factors such as kinks in the supply chain, environmental factors, continuing pandemic impact waves, global inflation, war in Ukraine, and others are finally starting to catch up to us, and it is unlikely that even the Nashvilles and Austins of the world will come out on the other side completely unscathed. Unfortunately, I think it was bound to happen eventually regardless of who sat in the Oval Office. But I also think that Nashville is uniquely positioned to weather the storm better than most.

[tdawg]

Whenever I hear anyone talk about how "bad" the economy is coming out of a once in a century global health and economic shock without also acknowledging that unemployment is at 6 decade lows and job creation is strong it pretty much tells me all I need to know about where that person gets their news. Other than inflation due to the reasons listed above by BnaBreaker the economy is fundamentally pretty strong. Anyway, was just in Nashville for Thanksgiving and the city is looking terrific! The upgrades to the airport are looking good, too.

[Texcitement]

Originally Posted by Dale

I don’t doubt that rough(er) times are ahead. But it is interesting to me that Nashville thread is the only thread where this has become a topic of concern. Is concerned heightened due to Amazon cutbacks ?

The developments my firm has canceled were in other cities, not Nashville; however we've put a couple here on delay. Nashville is still comparatively stronger than nearly every market in the USA.

This is not intended to be a political comment. A recession would destroy my livelihood. There are basic reasons why some projects are being canceled now and others are being pushed through as this is inherently a risky business due to the development timeline. The owners of my firm are more risk averse than most. Our projects are midsized mixed-use and fully capitalized before first shovels in the ground. The sources of our funding for future/proposed projects have slowed dramatically in the past 6 months. I wish I could change that, but it's a fact.

The CRE industry is a small community, and we 'get' our news mostly from each other. Fuel, lending, and labor costs are the most direct factors to everything we do. When the large development firms start pulling back, that will be THE tipoff to recession. The Fed has cautioned about recession, as noted by recent hikes in the Fed Funds Rates, which are actually closer to where they normally historically should be. The Fed has stated there are likely to be more in the near future.

To Nashville in particular, and I live here, caution about the economy is mostly linked to the two big fish the city landed just before the pandemic. Their plans for Nashville have caused a historic boom. Amazon's and Oracle's impact on Nashville is still perceived by many in my industry to be fluid. Mind you, I have NO inside knowledge of either of those companies.

[tdawg]

Hoping for you and your firms continued strength and success in the future, Texcitement. I don’t think it’s a political statement to acknowledge that the Fed should have begun raising rates from near zero years ago, long after the recovery from the Great Recession began, to more historically normal.

[jmecklenborg]

Originally Posted by tdawg

the Fed should have begun raising rates from near zero years ago, long after the recovery from the Great Recession began, to more historically normal.

Yeah, back in 2015-16.

What's crazy is that the rate plunge in early 2020 motivated me and a couple million other people to refinance our homes. What did we do with the cash-out and lower monthly payment? Most probably spent it on dumb stuff, but a lot re-invested it in stocks or another property. So that rate drop really set off a broad wave of investing/speculation.

The Fed really needed to start raising rates almost immediately after that drop. Instead, things got superheated in 2021 and now we're in a soft crash. So dumb. So predictable.

[Texcitement]

So things are still very very good here, as indicated by today's (latest) tower announcement. Mind you, the towers are really the ones that get highlighted here. There are over a hundred solidly large developments underway in Nashville. This is another tower in Midtown, and there are still lots of big projects that are ON SCHEDULE. This one is at the lot between 16th & 17th Avenues along McGavock Street in Midtown, adjacent to the big project planned for the Beaman property that will have 6-8 towers on it.

Here's the latest with rendering from Nashville Post.

[nashvilleron]

We had images and details released this past week for VeLa Pietown going at 601 Lafayette.
32 stories, 411 units, 360'
Johnston Marklee and Lamar Johnson Collaborative will partner on the architectural design

The first image has other proposed buildings that have not started yet. There are others that are not pictured that are also proposed that will be in front of this tower and some that are already completed or under construction in front or to the side of the tower'

[nashvilleron]

The red structure in the diagram below is the 16th & Mcgavock project listed above.

The structures that are in the dark blue are some but not all of the projects proposed for the eastern Mid-town section of Nasville along the interstate.

[Texcitement]

Originally Posted by nashvilleron

The red structure in the diagram below is the 16th & Mcgavock project listed above.

The structures that are in the dark blue are some but not all of the projects proposed for the eastern Mid-town section of Nasville along the interstate.

Just want to emphasize that this 3D rendering is just for Midtown and even it has about 10 proposed towers missing. That's completely out of the view of the rendering posted above of the downtown with 601 Lafayette. Midtown would be to the left of the rendering that Nashvilleron posted for Lafayette above.

The downtown rendering doesn't include many buildings, including 3 huge ones that are already under constr. and not visible on the skyline yet. Then there will be the city's tallest at 60 floors at the left-center of that rendering. Lots of tallboys going up and on to the next decade. By 2030, the downtown and midtown skylines will be connected continuously from Peabody Union at far right of the rendering all the way to 25th Avenue where the Sinclair is underway.

Nashville already has a cool skyline for any city among the second tier of cities. It will have the coolest skyline among that group by 2028/2030.

[PillowTalk4]

Originally Posted by Texcitement

...

Nashville already has a cool skyline for any city among the second tier of cities. It will have the coolest skyline among that group by 2028/2030.

I don't know about having the coolest skyline amongst its pier cities, but it will definitely be one of the most expansive. And, lets not forget that if all goes as envisioned for the East Bank, that will expand the skyline even more over the next 20 - 30 years. I just wish I was about 20 years younger to take it all in and enjoy it. Maybe my younger self in a parallel universe is enjoying it in ways that I would have loved to...

[jmecklenborg]

I do believe that what is happening in Nashville - most of the new office/apartment/hotel development clustering in or near downtown - is happening because the city does not have a loop highway.

It's a total accident of history that the city was of the exact size in the 1950s and 60s that it became the junction of interstate highways that radiate in six directions but no loop highway was built.

[Texcitement]

Originally Posted by jmecklenborg

I do believe that what is happening in Nashville - most of the new office/apartment/hotel development clustering in or near downtown - is happening because the city does not have a loop highway.

It's a total accident of history that the city was of the exact size in the 1950s and 60s that it became the junction of interstate highways that radiate in six directions but no loop highway was built.

That's a good observation and it's part of what makes Nashville such an interesting place, especially among cities east of the Mississippi. Key point is this area is very hilly (pre-mountainous) and very very very rocky. We've even been compared to cities in the western USA, especially California cities. I get that: there are lots of buildings built into sides of steep hills surrounding the central business district. One of the reasons Nashville became a city in the antebellum era is because it was not a hub of agriculture. Being on one of the key navigable rivers in the South, it was a city of commerce (almost) from the start.

So our topography makes the city very compact, although the total numbers include a county of 500 square miles. Nashville by necessity is actually compact and that includes the interstate 'loops' that were planned 70 years ago. It's true that the suburban counties epitomize sprawl and that's due in large measure because of the rocky soil with very low/limited perk. Keep in mind, the suburban boom started in the early WW2 years and in Nashville (Tennessee) that happened in rural areas. That meant each house needed a lot of land around it to absorb the septic field lines.

What that means about Nashville today is that the city is expanding from its traditional core. There are old, pre-Metro boundaries that are still relevant today that dictate the development and zoning of current/future development. From an airplane at 30K ft at night, Nashville looks like a spider. That's because of the commercial corridors. As the city booms, and the suburbs are booming at an even greater clip, they will continue to follow those traditional commercial corridors. The density of many of those corridors are as high as any other city in the USA, and that will only increase in the future. That's why you see lots of mid/high rise residential in the traditional urban boundaries. The rocky terrain is why you will likely not see an outer beltway for Nashville.

Finally I think the evolutionary growth of Nashville and its future growth along those commercial corridors makes it ideal for rapid transit, but that hasn't (yet) been a priority for the regional leaders. I think TDOT and a timid mayor is standing in the way of that.

Nashville is such a special place for its topography, location, people, spirit, natural beauty, and energy, and it's actually a very forward thinking place. It will figure out the infrastructure it needs but it's going to take time and patience.