Nashville Mixed-Use Kicks Off 20-Story Office Building
- Jun 22, 2018
Construction of a 20-story, 329,000-square-foot Class A+ office building—the first of a three-phase, mixed-use project in The Gulch neighborhood of Nashville, Tenn.,—is set to begin in August. Located at 1222 Demonbreun St., the building will also have 6,000 square feet of retail and is expected to be completed by May 2020.
The property is part of Gulch Union, a joint venture of Endeavor Real Estate Group and Granite Properties. Future phases of the project, located between 12th and 13th avenues and McGavock and Demonbreun streets, will also include luxury residential space and a boutique hotel. Endeavor is also developing a 413,000-square-foot mixed-use project anchored by Whole Foods at 1200 Broadway in Nashville.
“The Gulch Union location offers unparalleled access with multiple points of ingress and egress, tremendous walkability, spectacular views and immediate proximity to Whole Foods and popular retail and restaurants along M Street and through The Gulch,” Jamil Alam, managing principal of Endeavor, said in a prepared statement.
Turner Construction Co. is the general contractor. Designed by architectural firm HKS, the asset will have large floorplates of about 30,000 square feet with minimal columns. Tall floor-to-floor heights combined with full-height glass will bring in abundant natural light. Financed by International Bank of Commerce, the building is being constructed without a preleasing requirement.
“Sustainability, security and large column-free floors are consistently identified by tenants as priorities. The Gulch Union office building is pursuing LEED Silver and is located within Nashville’s only LEED-ND neighborhood,” Jason Crist, a senior vice president & associate principal at HKS, said in a prepared statement.
Amenities will include a fitness center with lockers and showers, a 48-seat training room, indoor/outdoor sky lounge with downtown views, catering kitchen, micro-market serving fresh snacks and meals, on-site property management and 24/7 security.
Office construction is strong in Nashville, with more than 1.8 million square feet of space expected to deliver within the next two years, according to Cushman & Wakefield’s Nashville office Q1 2018 report. More than half of that, 55.3 percent, was expected to come online during the second quarter, driving up the Class A vacancy in the short term. The report notes 18.2 percent of the space under construction is preleased.
“Overall asking rents in Nashville are set to rise as the new spaces ask higher-than-average rents due to rising construction and land costs along with healthy demand,” according to the Cushman & Wakefield report.
“We continue to hear from office users who are looking to reduce their commute time but still desire an amenity-rich environment that is walkable to downtown entertainment options. As employers compete for talent in a very tight labor market, we expect Gulch Union to appeal to today’s discerning user,” Crews Johnston, a senior managing director with Cushman & Wakefield, said in prepared remarks.
There are several major mixed-use projects being developed or planned in Nashville including Fifth + Broadway, a $430 million development at the former Nashville Convention Center. Construction began in 2017 and Skanska, the general contractor, recently increased its contract with developer OM-SE, a joint venture of OliverMcMillan and Spectrum | Emery. The project will also have an office tower with nearly 400,000 square feet of Class A space along with retail, entertainment and residential offerings.
Hensler Development Group and Stiles Corp. are proposing a mixed-use project in central Nashville with about 170,000 square feet of Class A office space in a five-story building. Peabody Union at Rolling Mill Hill is also expected to feature retail and a 25-story, 350,000-square-foot luxury high-rise.
Meanwhile, CBRE Capital Markets arranged the sale of 4th & Church earlier this month, a Class A office tower in downtown Nashville, for $43.9 million. The asset, formerly known as the Sun Trust Building, was sold by Albany Road Real Estate Partners to Stoltz Real Estate Partners and was 92 percent leased.
Rendering courtesy of Endeavor Real Estate Group