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VOL. 40 | NO. 12 | Friday, March 18, 2016

New industry, housing spur Midstate growth

By Kathy Carlson

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The bitter taste of Hemlock Semiconductor’s abandonment of plans to build a billion-dollar plant in Montgomery County has been sweetened somewhat, one of many in the commercial real estate market in Nashville’s surrounding counties.

While Davidson, Williamson and Rutherford lead the way with on-going construction or notable plans for high-end and mid-level projects for mixed-use, office space and industrial development blanketing those three counties, other areas are luring in attractive companies and giving their employees reason to ditch the compute and live close to home.

A company like Google, or Alphabet, Inc., as it now styles itself, isn’t setting up shop in every suburban county, but there is considerable activity in the region, including hamlets like Mt. Pleasant where an Italian company is building a manufacturing facility.

Other counties, Robertson, for example, don’t want to get left behind. Some 50 private investors recently pooled together to hire Retail Strategies for a plan to attract retail, says Margot Fosnes, president and chief economic development officer of the Robertson County Chamber of Commerce.

“We believe we’re positioned to catch up in the next 10 years,” Fosnes says. “There’s still room for development and land and housing prices are still low compared to other areas like Williamson and Davidson counties.’’

Seeking new business and making sure employees at all levels have a more affordable place to live go hand-in-hand for county and city planners and developers. That’s why a 700-unit apartment complex is soon to begin construction in Lebanon and White House is getting a 950-unit mixed use development.

“There’s still strong demand for multifamily housing north of Nashville,” says Danny Hale, CEO of Halo Realty in Hendersonville. “I expect two or three apartment complexes coming on line within the next 24 months,” adding about 600 to 900 new units.

Here is a brief look at commercial real estate in the region:

Cheatham County

Growth has slowed in Cheatham County, but there are some bright spots in Ashland City and Pleasant View and near Exits 24 and 31 from Interstate 24.

There’s also interest in land near Exit 188 from Interstate 40, says Daryl D. Phillips, director of economic development with the Cheatham County Joint Economic and Community Development Board.

The exits off I-24 are attracting potential hotel and grocery stores developers, but construction is probably a few years away, he adds.

Recent developments in multifamily housing include the 135-unit Braxton Condominiums at Harpeth Shoals Marina.

The Braxton attained full occupancy early last year, attracting people who had been living in Nashville and Williamson counties and wanted to live full-time in the condos – along with those who wanted weekend homes near the water.

Several years back, before the 2008 recession, Cheatham County was charging homebuilders $3,750 per unit to help cover the cost of building new schools and adding infrastructure to serve new residents.

Those were better times. These days, Cheatham wants to win back the builders with a $50-per-unit fee.

“It’s a little slower here than other areas. You don’t see huge multifamily developments. The community has a lot more green space,” says Phillips.

Phillips says existing retail space is being filled. A small shopping center near a Walmart in Ashland City is now gaining tenants after losing businesses in the 2010 flood. A mixed-use project, the Villages in Pleasant View, still has room to grow. It offers retail stores on ground level and condos on top.

Dickson County

The 162,500-square-foot The Crossings of Dickson shopping center is being developed by Baker Storey McDonald Properties. The center serves six other counties besides Dickson, says Tom Frye of Baker Storey McDonald.

Construction is complete, and includes retail stores such as Hobby Lobby, Marshall’s, Ross and Petco, plus restaurant and take-out food offerings.

The Crossings was built along Highway 46 in front of a Super Wal-Mart and close to I-840’s south loop. Some 20,000 people live within five miles of the shopping center, Baker Storey McDonald states.

A Fairfield Inn and Suites is under construction off Interstate 40, says Joseph Graves, president and CEO of the Dickson County Chamber of Commerce, and the Tennessee College of Applied Technology in Dickson County will be expanding its existing facility.

Population growth is mainly in the southern part of the county, in Dickson, Burns and White Bluff. The new Dal-Tile manufacturing facility will start production in coming weeks and at maximum capacity will employ 320, Graves says.

An educational partnership between Freed-Hardeman University and Nashville State Community College will help keep the area attractive to employers. The partnership allows students to earn their first two years of college credits through Nashville State, then transfer to Freed Hardeman.

Maury County

Maury County, perhaps best known as home to General Motors’ Spring Hill manufacturing site, is attracting new retail and apartment development.

Retail has been booming in the past three years in the county’s two main towns, Spring Hill and Columbia, says Wil Evans, president of the Maury County Chamber and Economic Alliance.

The Crossings of Spring Hill, at the intersection of Columbia Pike and Saturn Parkway, is an open shopping mall covering more than 900,000 square feet. It opened in 2008 and includes about 50 businesses, including a Super Target, Bed Bath and Beyond and Kohls. In the past year, a Carmike movie theater opened nearby along with Jonathan’s Grille. Planning is under way for additional restaurant and hotel offerings.

Apartment projects are humming along. In Columbia, ground is expected to be broken on Eagle Ridge, a gated apartment community with 184 units on James Campbell Boulevard. Two similar developments are in the works in the north part of Columbia.

In Spring Hill, the Worthington Glen apartment complex south of Saturn Parkway is open, with approximately 300 units of higher-end apartments.

A Del Webb community for people age 55-plus is under development in Spring Hill. Called Southern Springs, it will feature more than 600 single-family and multifamily units and is slated to open in 2017.

Another area with potential for commercial growth is in Mt. Pleasant in the southern part of the county. Ceramic tile manufacturer UST, a subsidiary of an Italian company, is building a manufacturing facility there and plans to hire 180-200 people.

“They’re really starting to experience a boom there because of that,” Evans says, adding the county is working hard to attract office-type projects.

One source of office space became available when General Motors vacated its former Saturn Headquarters in Spring Hill. It became the Northfield Workforce Development and Conference Center, operated by the South Central Tennessee Workforce Alliance.

Montgomery County

Google “Clarksville” or “Montgomery County” and your search may yield … Google.

The Clarksville area received an early holiday gift late last year when Google announced it was bringing a $600 million data center there, along with 70 new jobs.

Even better, Google purchased the 1,300-acre industrial site that had been acquired by Hemlock Semiconductor. In 2014, Hemlock abandoned its plans to build a billion-dollar-plus plant there.

“From a regional perspective, this is a very exciting announcement,” Clarksville Mayor Kim McMillan said at the time.

“As we’ve discussed for some time, growth in Middle Tennessee is expected to continue at an exponential rate. Google’s investment in Clarksville-Montgomery County is proof that the technology industry is a significant part of that growth. I am very excited about Clarksville’s role in bringing new investment, new jobs and new technology to the area.”

The $600 million facility will help support Google search engine and applications, and the 70 initial jobs will include computer technicians, engineers and electricians. The project will take place over years, not months.

Google may have been the big economic development prize for 2015, but it wasn’t the only one. Akebono Brake Corporation officials announced a $48.4 million expansion that would add 65-plus jobs, and Esquire Wire will add 60 jobs through a $1.8 million expansion.

With expanding jobs and population, retail development is following suit, data from the commercial real estate firm Colliers International shows.

New retail development is going on by Gateway Hospital, a strip center development on Dunlop Lane. Demand is strong, as 50 percent of this space is pre-leased.

Addison at Rossview Phase II is a 136-unit multifamily apartment development under construction on Holland Drive, Colliers reports, citing information from CoStar. In addition, the office space market is at its lowest vacancy rate in Clarksville-Montgomery County since 2006, at 8 percent.

Eighteen retail construction projects are currently under way in Montgomery, according to information on the Clarksville Montgomery County, Tn. Economic Development Council’s website, clarksvillepartnership.com.

Robertson County

Robertson County, directly north of Nashville and sandwiched between Montgomery and Sumner counties, is sharpening its game plan to bring more retail options to its 68,000-plus residents.

The county has been successful in adding manufacturing jobs over the last 10 years, and several potential projects are in the pipeline, says Fosnes with the Chamber. The challenge is attracting the white-collar jobs that many Robertson County residents commute to Nashville to fill.

Much of the county’s recent growth is taking place in and around White House, the Nashville suburb that’s partially in Sumner County and partially in Robertson. Most of White House’s commercial and industrial growth is on the Robertson side because Interstate 24 interchanges go through there.

White House officials have just approved a site plan for a 950-unit mixed-use development to gradually take shape on several hundred acres near Exit 108, Fosnes adds. A golf course community called Bear Creek at Burrus Ridge had been planned for the site, but plans shifted with the economic recession of 2007-08.

In addition, The Standard at White House will bring 240 units of market-rate residential housing when it’s completed.

The Standard’s one-, two- and three-bedroom apartments provide an option for people who work in Robertson County but aren’t yet ready to buy a house, she says.

Springfield, the county seat, is very much like Dickson in that it draws shoppers from Cheatham and Montgomery counties, from Portland in Sumner County and from Kentucky, says Fosnes. It’s a retail hub, and because it’s the county seat, it’s also a business hub.

Sumner County

Sumner County continues to gain new jobs and add commercial projects serving the more than 172,000 residents of this county north of Nashville.

Hendersonville’s Hale sees nothing but good times for Sumner.

“I’ve been in real estate for 30 years and I haven’t seen anything like this,” he says. “It was busy before the recession but that has nothing on what’s going on now.” Interest is coming from millennials, business relocations and retirees.

Colliers International’s commercial real estate reports indicate that 779 units of multifamily development were under construction in the fourth quarter of 2015 and to be completed in 12 months.

Sumner apartments are at 96 percent occupancy, a change of 1.1 percent, and average monthly rents rose by 1.4 percent in the past quarter to $949.

On the retail front, Indian Lake Village West Plaza came to market in the fourth quarter of 2015, with 75,000 square feet of space, Colliers reported. The building was 75 percent occupied at that time.

The Streets of Indian Lakes, a 275,000-square-foot open-air lifestyle shopping venue in Hendersonville, recently was sold from Inland to U.S. Properties, Hale says. The price was undisclosed. Hale adds the new owners have made a major investment in the center and plan to fill remaining vacant space and possibly make improvements to parking.

Bradford Company, a manufacturer of reusable packaging, will be investing $5.1 million over the next five years to expand its Gallatin facility, adding 25 jobs, the Tennessee Department of Economic and Community Development announced.

And the retail clothing giant Gap said recently it was adding 50 jobs at its Gallatin distribution facility, its largest worldwide distribution center. Three years ago, the firm invested $35 million to expand operations. Gap is one of the county’s largest employers.

Other Sumner employers expanding their operations and adding jobs include Servpro, a cleaning and restoration services company creating 204 new jobs, and Unipres USA, an automotive parts manufacturer that announced it would create more than 400 jobs and make significant capital investments.

Wilson County

Wilson County, where clothing maker Under Armour is the latest company to set up a huge distribution facility, is enjoying commercial real estate growth from apartments to retail to an upgraded aviation facility.

Just this week, Commercial Realty Services announced it plans to build a $10 million mixed use project near Mt. Juliet’s Providence MarketPlace to include retail and office space. The company is also building a Marriot Courtyard in the same area.

Retail development is increasing. The Providence area continues to boom and the old downtown area of Mt. Juliet is drawing medical offices and restaurants.

Lebanon has its own projects to draw residents.

“We’ve got a lot of apartment projects going on right now. A 400-unit apartment complex is under way right off the Hartmann Drive exit adjacent to medical office space that’s been developed at that exit,” says Jud Nave, chair elect and economic development vice chair of the Lebanon Wilson County Chamber.

The complex, called Hartmann Plantation, offers one-bedroom garden-style apartments along with two-, three- and four-bedroom townhouse units, some with garages. Furnished two-bedroom corporate units also are available. Tenants have been moving in and new units are being built.

Local approval has recently been given for a 700-unit apartment complex, yet to be named, to be built on the Highway 109 corridor, Nave says. Another complex, the Falls at 109, was recently built in the area.

The Hamilton Station apartments on Highway 70 in Lebanon recently completed its most recent addition.

The Square in Lebanon recently underwent a multimillion-dollar renovation, Nave says. There’s been a resurgence of retail shops there, including men’s and women’s clothing stores, and that has drawn young shoppers there. “The old arcade building has been renovated from the ground up and is ready for a nice restaurant coming in.”

Another upgrade is coming at the local airport. Ground was recently broken at the Lebanon Municipal Airport on an expansion of its FBO or terminal facilities. “We’re seeing more corporate growth,” Nave adds. “A modern FBO is a nice place to welcome those folks. It’s the first thing they see” when they land in Lebanon.

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