Nashville has a new 65-story residential tower on the drawing board that could set a new record as the tallest building in the city at 750 feet (228 m). The proposed project highlights the change underway in the city with a surge of high-density projects that are transforming both its urban skyline and its streetscape.
Music City has been experiencing explosive growth over the past several years with a growing population, business expansion, and a thriving tourism industry that is fueling development across all property sectors. “Nashville is very fortunate to be hitting on all cylinders,” says Bert Mathews, president of the Mathews Company and a partner in the Nashville office of Colliers International, in addition to being a ULI trustee. Part of that momentum can be credited to the city’s civic leadership, including a series of mayors, who have laid the foundation for the success the city is having today, he adds.
City leaders made decisions to concentrate investment in key projects that have helped strengthen the urban core. In 2001, for example, the city opened three new downtown institutions that included the Frist Center for the Visual Arts, the Country Music Hall of Fame, and the award-winning Nashville Public Library. And in 2013, the city opened its new 2.1 million-square-foot (195,100 sq m) Music City Center convention center, where the 2019 ULI Spring Meeting will be hosted. “Those are a few examples of where our mayors were able to build a downtown that has attracted all of the energy that we have today,” says Mathews.
One of the challenges in Nashville, as with other cities of its size, is managing growth within existing space constraints. Much of the urban area has already been developed, so developers are looking to assemble sites for infill projects or brownfield redevelopment. “There are a number of older developments that weren’t the most efficient in land use, and you’re seeing those being repurposed or knocked down and rebuilt,” says Stephen Kulinski, managing director of CBRE’s Nashville office.
New projects are increasingly going vertical to maximize density amid rising land costs and scarcity of sites in high-demand areas. Good building sites have become much more expensive, with costs ranging anywhere from $200 to upwards of $600 per square foot ($2,152 to $6,456 per sq m) depending on the location and zoning, notes Kulinski.
New Projects Transform the Skyline
Much of the new development has been focused in and around downtown with some large mixed-use projects and skyscrapers that have been completed or are underway. For example, Nashville-based Giarratana LLC completed its 505 building at Fifth Avenue and Church Street in early 2018. The 45-story luxury apartment and condo tower is now the second-tallest building in the city at 543 feet (165 m) high behind the AT&T Tower at 617 feet (188 m) high.
Giarratana is currently in the planning stages of developing a second high-rise residential tower, the Paramount across from the Nashville Library. If approved, it would be the tallest building in the city at 750 feet (228 m).
Cities that have seen a surge in growth similar to Nashville’s, such as Austin, are looking at vertical development and higher-density projects as a way to avoid sprawl, notes James Goettsch, chairman and co-CEO of Chicago-based Goettsch Partners. “In Nashville, what they have recognized is that high-density, mixed-use neighborhoods actually help to reduce the congestion, because it increases the walkability and the experience of the streetscape,” he says.
The key for cities and developers is to look at high-density projects more holistically in terms of not only how that project changes the skyline, but also how it ties into the streetscape. “Especially for tall buildings, there is a tendency to focus on the top of the building, but in terms of city life it is more important to focus on how the building meets the ground versus how it meets the sky,” says Goettsch.
In the case of Paramount, the proposed development site is a relatively small footprint at about 12,000 square feet (1,114 sq m). So, the challenge was to create a design that used the available building space, but still has an open and accessible feeling on the ground floor and in the streetscape. “I think developers are increasingly open to the idea that they can increase the value of their property if they make it more approachable and more livable at the street level,” Goettsch says. “And as multiple properties do that, I think it increases the walkability and the street life overall.”
Key Projects Take Shape
Nashville appears to have a strong pipeline of projects ahead that are transforming the city center and surrounding neighborhoods. Two significant mixed-use projects moving forward include Nashville Yards and Fifth + Broadway. Nashville Yards is a 16.2-acre (6.5 ha) mixed-use development that runs from Broadway to Church Street at the entrance to downtown Nashville. Southwest Value Partners is the developer/owner of the project, which will include more than 1.5 million square feet (139,400 sq m) of class A and creative office space, 1,000 residential units, 1,100 hotel rooms, and 600,000 square feet (55,700 sq m) of retail space. Construction is underway on the first parcel of the project, a 591-room Grand Hyatt that is set to open in 2020.
Fifth + Broadway is a $400 million mixed-use project that is being developed and designed by Oliver McMillan and Spectrum | Emery on the site of the former Nashville Convention Center. The master plan calls for 235,000 square feet (21,800 sq m) of retail and entertainment space, 385,000 square feet (35,800 sq m) of class A office space, more than 300 apartments, and a new National Museum of African-American Music.
Development activity also is starting to spread out to urban neighborhoods, such as Germantown to the north of downtown, with new residential, restaurants, and retail. A similar resurgence is happening in the Gulch, 12 South, and east Nashville, among other areas, notes Mathews. “So, we’ve had a lot of investment in our downtown, but we’ve also seen neighborhoods just really explode in a way that is capturing the identify of those specific communities,” he says.
One of the statistics that the city and chamber often quote is a sustained pace of growth where between 60 and 70 people are moving into the city each day, or about 21,000 to 25,000 new residents per year. “There was a big boom in multifamily that slowed down over the past year, but I think it is poised to take off again,” says Kulinski. The city is also riding high on some major business relocation and expansion announcements in the past year.
Last year, financial asset management firm AllianceBernstein announced that it would move its headquarters from Manhattan to Nashville and relocate about 1,050 jobs beginning in a transition that began in late 2018. The firm reportedly signed a 200,000-square-foot (18,600 sq m) lease as part of the Fifth + Broadway office development.
Amazon also announced last fall that it would invest $230 million in locating a new operations hub in Nashville. The move is expected to create 5,000 new jobs, with the company occupying about 1 million square feet (93,000 sq m) of office space at Nashville Yards. “You’re seeing a lot of these large tenants moving in from other parts of the country,” says Kulinski. In addition to the growing labor pool, employers are attracted to the lower business costs and lower cost of living that Nashville offers, he adds.
Like any other growing city, Nashville also has to deal with the strain that expansion is putting on its infrastructure, notably related to transit and workforce housing. Last year, Nashville residents voted against a $5.2 billion transit spending package that would have created high-speed rail along with other transit improvements. “I think the whole city is aware of what needs to be done, but trying to figure out how to pay for it and what the best steps are is another matter,” says Mathews.
Editor’s Note: Look for more coverage of key Nashville projects, including Nashville Yards and 5th + Broad, in the spring issue of Urban Land, leading up to the 2019 ULI Spring Meeting.