MEMPHIS, TENN. — The Shopping Center Group is the leasing agent for a new retail center under construction at 6450 Poplar Ave. in east Memphis. Crown Centre LLC, an affiliate of Fogelman Investment Co., is developing the 29,000-square-foot retail center, which is adjacent to International Paper’s world headquarters. The building shell is expected to be complete in April.
Nashville has quickly become one of the most active Southeast markets for multifamily, both in terms of development and sales. Driven by tremendous job growth, strong population increases, a pro-business climate and an educated workforce, Nashville’s remarkable multifamily growth is not overstated. From 2014 to 2017, more than 12,300 units are projected to enter the market, with another 9,000 that are planned or proposed. Concerns have arisen that Nashville’s supply will outpace the demand in the medium term. However, job growth indicators, sales activity and lease-up velocity indicate the contrary. Nashville’s economy has surpassed the $100 billion mark with a 5.1 percent unemployment rate and a 4.2 percent GMP growth rate that is double that of the rest of the nation. Notable recent expansions include General Motors (1,800 jobs), Under Armour (1,500 jobs), Magna International (357 jobs), and FedEx (347 jobs) — all of which were announced in the second half of 2014. In addition, Bridgestone America has announced that it will consolidate its operations in Nashville adding 600 jobs. These expansions combined with immense foreign direct investment continue to fuel the area’s growth. According to IBM’s 2014 Global Location Trends Report, Tennessee ranks first in the nation in terms …
Jack Daniels, FedEx and Gibson Guitar are a few international brands that already call Tennessee home, and the list has expanded over the past two years, as major brands have chosen to grow their operations in Middle Tennessee. Recent industrial relocations including Under Armour, Beretta and Hankook Tire are a few notable companies that chose Nashville over other major markets in the U.S. In addition, existing companies such as General Motors, FedEx and Nissan continue to expand their footprint in the region, creating more jobs and building larger facilities. All of this activity has created the demand for more site-ready properties that can accommodate build-to-suit projects and be delivered quickly. Nashville’s continued evolution as the South’s leading auto manufacturing hub, as well as its favorable central location, has bode well for the industrial market over the last few years. Favorable Fundamentals Nashville’s industrial market vacancy rate of 7.1 percent at the end of fourth-quarter 2014 is the lowest it has been since the fourth quarter of 2008, and the 2014 total net absorption has reached more than 2.25 million square feet, the highest absorption since 2006. This year is projected to be a banner year for new construction with multiple …
MURFREESBORO, TENN. — Sterling Organization has purchased Stones River Mall, a 594,688-square-foot enclosed regional mall in Murfreesboro, a suburb of Nashville. Sterling purchased 497,691 square feet at the mall, which was developed in 1992 and renovated in 2008. The company acquired the asset through its institutional fund: Sterling Value Add Partners II LP. Anchored by Dillard’s, Sears and J.C. Penney, other tenants include Aeropostale, Books-A-Million, Electronic Express, Hancock Fabrics, Chuck E. Cheese’s, PacSun, Bath & Body Works, Shoe Carnival, Versona, Bink’s Outfitters, Hibbett Sports and Victoria’s Secrets. The mall’s outparcel restaurants include TGI Fridays, Olive Garden and Buffalo Wild Wings.
MEMPHIS, TENN. — DCT Industrial Trust has sold a portfolio of six Class A industrial properties in Memphis totaling 2.3 million square feet for an undisclosed sales price. Built between 1998 and 2001, the six properties were fully leased to 11 tenants at the time of sale. The portfolio comprised Eastpark I at 5300 Hickory Hill Road; Eastpark II at 5405 Hickory Hill Road; Chickasaw A at 5950 Freeport Ave.; Chickasaw H at 6190 Freeport Ave.; Southpoint IV at 4800 Pleasant Hill Road; and Southpoint XIX at 5166 Pleasant Hill Road. Stewart Calhoun, David Meline, Samir Idris and Casey Masters of Cushman & Wakefield represented DCT in the transaction. Cushman & Wakefield also arranged acquisition financing on behalf of the buyer, Welsh Property Trust. Mike Ryan, Brian Linnihan and Jeff Walker of Cushman & Wakefield’s equity, debt and structured finance team arranged the financing. Additionally, Shane Soefker and Jacob Biddle of Cushman & Wakefield/Commercial Advisors provided market expertise for the transaction.
Nashville is now an established growth leader regionally and nationally. The city was a national trailblazer as the U.S. economy recovered from the Great Recession. That head start positioned Nashville to take advantage of broader growth trends and stay ahead of the pack as the remainder of the region and country started to grow again. Moody’s Analytics places Nashville firmly in an expansion phase, with fourth quarter employment growth 330 basis points ahead of the prior year, in-migration driving single-family housing permits up 13 percent last year and accelerating wage growth. Quoting Moody’s, “With the commercial real estate market tightening quickly, the pace of hiring will soon be contingent on how quickly new offices can be built or renovated. Yet there is still a good chance office-using employment could beat expectations, especially after 2016.” Class A buildings continue to dominate growth. Overall absorption for 2014 totaled 666,639 square feet, while Class A absorption was 689,009 square feet. Absorption exceeded construction by over 200,000 square feet, and Class A vacancy dropped from 5 percent at the beginning of the year to 3.5 percent at year-end. Vacancy that low inhibits movement, as is obvious in Brentwood with only 45,000 square feet vacant, …
The Nashville retail market continues to gain momentum. With approximately 338,773 square feet of retail construction underway, Nashville remains in a growth and expansion phase, with nationally recognized retail that offers unique options for tourists and locals. In 2014, approximately 53 restaurants opened, most notably Chauhan Ale and Masala House, Sinema, Prima, Acme Feed & Seed, Adele’s, City Winery, Two Ten Jack, Moto Cucina + Enoteca, Epice and Party Foul. Most of these landed in hot neighborhoods — The Gulch, East Nashville, 12th South, SoBro and Germantown. Nationally and locally we’re seeing demand for grocery-anchored retail. Demand has outstripped supply by a long shot. Major grocers own much of their real estate, and Publix followed suit in 2014, acquiring some centers it anchors, leaving fewer investor opportunities that will drive pricing and also move some investors into opportunities anchored by regional or independent grocers, or shadow-anchored assets. We actually expect non-retail projects to change the dynamic in Nashville in 2015. Within the Downtown loop, retail was non-existent, but with 1,000 new hotel rooms, 2,493 residential units and several new office projects under construction, bringing 5,000 more workers downtown, retail will follow. The $232.6 million Highwoods development for Bridgestone’s U.S. headquarters …
NASHVILLE, TENN. — Proffitt Dixon Partners will soon begin construction on Fountains Germantown, a 249-unit luxury apartment community located at 1407 Third Ave. North in Nashville’s Germantown neighborhood. The multifamily developer will break ground on Feb. 26 with an estimated completion date set for summer 2016. Nashville-based Smith Gee Studio designed the five-story community to standards set by the National Association of Home Builder’s Green Building Program. HFF arranged construction financing through Synovus Bank on behalf of Proffitt Dixon. The project team includes general contractor Doster Construction Co., management firm Matrix Residential and landscape architects Land Design and Civil Site. Civil Site is also the project’s civil engineer.
FRANKLIN, TENN. — CFG Capital Markets has brokered the $7.5 million sale of Claiborne Hughes Health Center, a 157-bed skilled nursing facility (SNF) located in the town of Franklin. The facility is located approximately 30 minutes south of Nashville and is one of five licensed skilled nursing facilities in the county. The building was originally constructed in 1949 as a high school and converted into a SNF in 1981. Claiborne Hughes was sold for $47,770 per bed to a private investor group. Proceeds were used to fully retire HUD mortgage debt and other liabilities. Michael Burchell, Mike Coiro and Samer Tahboub of CFG Capital Markets were the advisors on the transaction representing the seller.
KNOXVILLE, TENN. — Knoxville-based Wood Properties has brokered the sale of The Historic Farragut Hotel in downtown Knoxville for $3.7 million. The 135,000-square-foot former hotel is located on Gay Street. The buyer, Knoxville-based Family Pride Corp., is planning to implement a mixed-use renovation of the building. George Brown and Brad Blackwell of Wood Properties Inc. represented the undisclosed seller in the transaction.
