What area is your expertise?
• I specialize in commercial sales and leasing in the Cool Springs submarket just south of Nashville.
What trends do you see presently in office development in your area?
• There continues to be speculative development in and around Cool Springs on the office side. We’re also seeing the emergence of more and more mixed-use development in the area. Specifically Boyle Investment Company’s Meridian development and Southern Land Company’s McEwen Place are creating a new dynamic in Cool Springs.
Class A office condo developments are also seeing a resurgence. Caden Holdings, The Stauffer Company and Alliant Commercial each have new buildings underway that will allow smaller prospective office buyers to purchase condos in the 3,000-square-foot range and up.
Who are the active office developers in your area?
• Crescent Resources, Boyle Investment Co., Duke Realty and Highwoods Properties have the biggest presence in Cool Springs.
Please name one or two significant office developments in your area. What impact will these projects have on the market?
• The mixed-use developments mentioned earlier will allow for a better commingling of living, working and playing. The new headquarters for Nissan North America and Healthways are well underway. These projects should further bolster the area by increasing need for housing and amenities.
Where is the majority of development taking place? Why is this area doing well?
• The Carothers corridor on the east side of Interstate 65 is seeing the most development because of the supply of land currently available. The recent opening of the McEwen exit off of I-65 is also pushing development farther south along Carothers Parkway.
What area do you expect to be the next big development market? Why?
• The Pickering Farm just off the McEwen exit and Crescent Resource’s land right across the street will be the focus for larger development. I’m excited to see who ends up purchasing the 170-plus acres included in the Pickering Farm. There will be some unusable land due to existing hilltops and topography but the rest should make for a beautiful setting.
What areas are doing well in terms of office leasing? Which areas are struggling with office leasing?
• All of Cool Springs remains strong because of the continued relocation of companies to the area. I think that will hold true for at least the short-term. In the long-term the market may soften.
Please give a measure of office vacancy rates.
• The office vacancy for the Cool Springs submarket is currently around 8.4 percent. The greater Nashville area’s vacancy rate is approximately 9.1 percent.
What impact do current interest rates have on the office market? What predictions do you have for interest rates and their effect on the office market in the next year?
• Interest rates and construction costs leave only the biggest developers building the larger projects. I think we may also see an increase in vacancy as new and existing businesses re-evaluate what there leasing needs are in the current market. We may see less businesses moving to the area and possibly some going out of business as we’ve already seen with some with direct ties to the residential market.
What is the status of job growth/(un)employment rates and what bearing will it have on the office market?
• Job growth is still good in the Cool Springs area. The addition of Nissan, Healthways and Verizon should help maintain that positive growth.
Is there any type of office tenant absorbing a majority of space? What industries do you expect to expand in the next year to absorb a great deal of office space? What areas will be affected?
• Businesses that support the new Nissan headquarters will most likely lead to the absorption of available space.
Would you like to make any additional observations about the office market in your area?
• The Cool Springs submarket has seen remarkable growth and stability in the last couple of years. The available office space, infrastructure, housing and overall appeal to company executives will be the factors that keep the office market in Cool Springs as one of the top submarkets in Middle Tennessee. It doesn’t hurt that we now have four exits off of I-65.
— Submitted by Carlos Cooper, vice president-brokerage with the Nashville, Tenn. office of Chas. Hawkins Co.