| Nashville Office
The most significant trend in the Nashville, Tennessee, office
market is the absence of speculative development. The
only development activity has been projects that have achieved
a prudent amount of pre-leasing prior to the start of construction,
which is characteristic during the type of market conditions
that we are currently experiencing, says Rick Frazier,
vice president of marketing and leasing with Alex S. Palmer
Vice President of
Marketing & Leasing
Alex S. Palmer & Company
Recent significant developments include
Burton Hills IV: phenomenal success in the marketplace
because it opened up 80 percent pre-leased.
Roundabout Plaza: significant project signaling the success
of revitalizing Midtown Nashville.
West End Summit: part of the crescendo of the effort
to revitalize Midtown (scheduled for delivery in 2006).
The majority of development is taking place on the West End
in the heart of Midtown Nashville. I think that this is
due in part to the fact that more and more companies and corporations
are making the West End corridor the place to do business in
Nashville, says Frazier. It is primed for growth
and continues to be a hot area with several future development
sites slated to come on line in the next couple of years.
Noteworthy leases that have closed recently include
Union Planters: approximately 77,000 square feet at Highland
Ridge I (555 Marriott Dr.).
CareMark: approximately 20,000 square feet at Commerce
Center Building (211 Commerce St.).
Boult, Cummings, Connors & Berry: approximately 80,000
square feet at Roundabout Plaza (between 16th and 17th avenues).
While no one tenant takes a majority of space in Nashville,
the healthcare industry absorbs a majority of the office space.
The rental rate range for Class A property in Nashville is between
$20 and $25 per rentable square foot. With regard to vacancy
rates, the overall Nashville market is sitting at about 16.4
percent vacant, which is up approximately 2 percent from last
Nashville has weathered the economic downturn much
better that many of its market competitors due to efforts
by the Nashville Chamber of Commerce, particularly the Economic
Development Team and Partnership 2010, as well as prudent
development and investment, notes Frazier. Nashville
is currently poised to come out of the economic downturn ahead
of the game.
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