The Nashville retail market has firmly established itself as one of the strongest and most dynamic in the United States. From luxury national chains to local entrepreneurial storefronts, retailers are increasingly drawn to the city’s diverse and resilient economy — and for good reason.
Over the past decade, Nashville has been one of the fastest-growing cities in the country, with consistent year-over-year population and employment gains. This trajectory has been fueled by a favorable business climate, highlighted by the absence of a state income tax, as well as local policies that encourage corporate investment and relocation.
The results are tangible: global and domestic companies alike have planted deep roots in Middle Tennessee. Major players such as AllianceBernstein, Amazon, Nissan, Bridgestone, Asurion and Deloitte have relocated or expanded here, joining long-standing Nashville-based giants like HCA Healthcare and Tractor Supply Co., both of which continue to grow their local footprint.
This economic expansion has powered steady demand in the retail real estate sector. In just the past year, a wave of retailers — including Whataburger, In-N-Out Burger and 7-Eleven — have entered the Nashville market, underscoring its appeal to both national and regional brands. These additions further diversify a landscape already shaped by a mix of walkable urban hubs, destination dining districts and neighborhood shopping corridors.
Nashville’s unique topography and development constraints have influenced how retail space is delivered. Rather than sprawling suburban centers, the city has seen a proliferation of mixed-use developments, particularly in neighborhoods like the North Gulch, SoBro, 12South, West End and East Nashville. These walkable, live-work-play environments reflect evolving consumer preferences and have become essential components of the city’s retail strategy.
Looking at the data from Marcus & Millichap’s 2025 Retail Investment Forecast, the fundamentals backing this growth remain strong. Nashville’s job market is projected to expand by 1.6 percent this year, adding approximately 20,000 new positions — many in high-wage industries such as professional and technical services. This employment growth not only drives demand for housing but also boosts local spending power, adding fuel to the retail sector’s continued expansion.
Retail vacancy in Nashville is expected to fall to just 3.5 percent in 2025, nearly a full percentage point below the metro’s long-term average. Despite this tightening supply, construction is accelerating. Deliveries are anticipated to hit a four-year high, with 658,000 square feet of retail space coming on line this year alone.
Even with this new supply, absorption remains strong, and rental rates are rising in kind. The average asking rent is forecast to reach $21.50 per square foot in 2025 — the highest on record for the city.
The increase in rental rates is supported by a growing customer base that includes both new residents and office workers with rising incomes. The influx of high-paying jobs has fundamentally changed the city’s consumer demographic, making it even more attractive to higher-end retailers, dining concepts and experiential brands.
Meanwhile, Nashville’s rise has not gone unnoticed by investors. The ongoing expansion of Nashville International Airport has increased accessibility for capital sources from the West Coast, Northeast and abroad. This connectivity — paired with the city’s strong fundamentals — has encouraged significant institutional and private investment. Many long-time property owners are now capitalizing on the moment, taking advantage of elevated asset values and recapitalizing equity that has appreciated along with the city’s rapid growth.
Among the most high-profile developments launching or breaking ground this year are Alpha Development’s Goodnight Nashville on Broadway, Oldacre McDonald’s Tanger Outlets in Antioch and several large-scale projects led by locally based GBT Realty. The company is one of the nation’s most active retail developers, and its ongoing commitment to the market speaks volumes about long-term confidence in the city’s trajectory.
Another key milestone in Nashville’s retail narrative is the revitalization of Second Avenue downtown, which is bouncing back from the devastating 2020 bombing. Anchoring this resurgence is the future Songteller Hotel, the first major downtown investment by country music legend and Tennessee native Dolly Parton. This project exemplifies the blending of retail, hospitality and cultural heritage that makes Nashville’s urban core so distinctive — and so investable.
In many ways, Nashville represents the blueprint for modern retail development: population growth, rising wages, urban infill development and increasing institutional attention. The market’s momentum is being shaped not only by retailers and developers, but by evolving consumer expectations, thoughtful public policy and a private sector eager to invest.
— By Justin Sturdivant, First Vice President of Investments, Marcus & Millichap. This article was originally published in the April 2025 issue of Southeast Real Estate Business.