Nashville Chapter July Meeting Key Take Aways!
Richard Warren (Bradley Arant): Richard had a couple really interesting insights. Williamson County’s Mayor said over 280k people in county today and he believes development will continue to grow down the I-65 corridor; developers for the Belle Meade Plaza project have the money to level everything at once and build everything at the same time; Green Hills mall will add a new entrance to their mall as they are concerned that once the Belle Meade Plaza is finished, some of their stores may want to move; and the modern Class A buildings are renting for over $60/sq. ft. Starbucks took up most of the excess capacity in Nashville when they took 250k sq ft of space.
Hunter Johnson (Terracon): Hunter said that they have seen a slow period that is pretty typical for the summer months, but he is still hopeful for the rest of the year, with smaller scale commercial development and projects expanding the footprint into places like Mt. Juliet and even up to Portland. He said that the digital infrastructure data center talks have slowed down and people have put a pause on those developments.
Jeffrey Coats (JS Coats Capital, LLC): Jeffrey said that it has been a little slow with a lot of really tricky deals to finance; but he is moving along with a big deal that should close soon. He has lenders that will look at just about anything – multifamily construction, cold storage construction loan, townhome construction loan, retail, industrial. He said that he like to believe that he can find anyone a home.
Kelly Cochran (State of Tennessee Real Assets Management (STREAM): Kelly said that they are in a summer slowdown. There will be changes because of the election year and a lot of their leadership team is retiring. Agencies are expecting leadership changes, especially in State government. There has not been clear guidance on Federal agencies and there is a lot of waiting to see what things will look like when the dust settles. She feels they are coming into a belt tightening year.
Gary O’Brien (LaBella Associates): Gary said that based on two different conversations with engineers, they are looking at reduction of staff because workflow is slow. This is the first time he has heard this in the last ten years and wondered if this was the beginning of a downturn. He is seeing deep pocket developers sitting on the sideline waiting, while sellers are still pricing their property the way they did three to four years ago. He is not seeing multifamily in the pipeline. Gary said that industrial is the one spot that he sees a bright spot.
Richard Sprecher (Resolute Road Hospitality): Richard is concerned about the interest rates and it is hard to make deal numbers work. Currently, he is looking at some suburban acquisitions and continuing to look for the next deal. He looks for mid-level hotels because when there is a downturn those hotels are not affected as much. Although many high-end projects include multifamily, retail, and hotels, they are not interested in being in that space because it is just a different world.
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