Located in the corner of McEwen and Interstate Highway 65 Cool Springs, Tennessee, just 15 miles out of Nashville stands a huge mixed-use development.
The Franklin Park property is just one of several recent constructions of apartments and large offices propping up in Nashville’s metropolitan area. Local experts feel confident that the local market will be able to handle this new construction boom – for now.
Seventy-one acres of the Franklin Park site will be home to 350 luxury apartments and 5 Class-A office facilities covering 1.5million square feet. Another project is the $10milion park covering 11 acres of land to include boardwalks, walking paths over three miles, and an amphitheater of 600-seater. Construction for both the park and the property has already started with work on apartments and offices set to start before the year ends.
These new constructions pose some threat to Nashville’s apartment market. Woody McLaughlin, Parthenon Properties chairman and Greater Nashville Apartment Association’s statistics committee member indicated that at present there are over 10,000 apartments being planned and constructed in Nashville’s metro area.
McLaughlin stated that newly-constructed apartments are also filling up quickly. In 2012, around 4,000 apartment will be completed and another 4,000 by 2013. McLaughlin thinks that keeping up with the construction can become a problem.
The market however has gained some strength. At this time, only 4.6% of the metro apartments were vacant during the 3rd quarter as indicated by Reis Inc., a data firm. It is considered the lowest vacancy level in years and down from the 8% peak in 2009. Growth in effective rents has also been observed, increasing nearly 3.9% over the previous year.
Nashville sees build-up of strength in its office market with only 13.8% vacant offices during the 3rd quarter according to Reis. This makes the Nashville region the country’s 7th strongest market for offices, which is measured through the vacancy.
According to McLaughlin, the employment situation is Nashville is also picking up with the city’s diverse employment choices especially in Cool Springs where various establishments and major companies are situated.
With these various constructions going on in Nashville, the city is beginning to run out of easy-to-develop sites. In the coming years, developers will likely choose underdeveloped or existing sites for redevelopment.
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