186-Unit Apartment Community Trades in Metro Nashville

By Eliza Theiss, Associate Editor

Greensboro, NC-based Bell Partners Inc., the seventh largest apartment operator in the United States, has announced the acquisition of Grove Franklin Apartments, a 186-unit apartment community in Nashville’s suburb of Franklin, TN.

The property, aptly renamed Bell Franklin Gateway, is located at 1116 Davenport Blvd, at the intersection of Franklin Road and Moores Lane, at the gateway between Brentwood and Franklin, two of the most prosperous suburbs of Nashville. The 186-unit property is comprised of one-, two- and three-bedroom apartments. The fully leased community features amenities such as a 24-hour fitness center, resort-style swimming pool, designated picnic area complete with fire pit and grills, clubroom with complimentary Wi-Fi, business center and internet café, executive conference room, expansive lawn areas as well as storage space and garages. All units feature finishes such as granite countertops, tiled backsplash, stainless steel and black appliances, washer and dryer, a patio or balcony.  The townhomes of Bell Franklin Gateway also feature a two-car attached garage and hardwood floors, with some units boasting walk-in showers, Juliet balconies and garden tubs. Units range in size from 672 to 1,619 square feet. The community is within walking distance of Gateway Village, the prestigious Brentwood High School and Middle School, and the Franklin/Cool Springs employment hub.

The Nashville Business Journal reported a $35 million sale price for the property (or about $188,000 per unit), which Bell purchased from SWH Residential, LLC.

To date Bell Partners has invested over $112 million in apartment properties, including its most recent acquisition of Bell Franklin Gateway. The company recently completed the $200 million final close of Bell Apartments Fund IV. The company now owns or operates 248 apartment assets, totaling upwards of 69,000 units.

Photo courtesy of Bell Partners

Chart courtesy of CBRE

Franklin Shopping Center Bought for $37.5M

By Eliza Theiss, Associate Editor

Indianapolis-based real estate investment trust Kite Realty Group has announced the acquisition of Cool Springs Market in Franklin, Tennessee. The full service REIT purchased the 224,000-square-foot shopping center for $37.5 million—this figure, however, does not include closing costs.

Cool Springs Market, located at the intersection of I-65 and Cool Springs Blvd, draws its customer base from a five-mile trade area with a population of 85,200 boasting average household incomes of $124,000 which is in compliance with the buyer’s declared focus on the development, construction, acquisition, ownership and operation of high quality neighborhood and community shopping centers in selected US growth markets. “Nashville is a new market for us that we are very excited to be entering as it aligns directly with our geographic strategy of growth cities in the Southeast, Midwest, and Texas,” said Kite Realty Group Trust Chairman and Chief Executive Officer John A. Kite.

According to a recent Nashville Market Outlook 2013 report released by CBRE, Music City’s retail market will continue its upward climb throughout 2013 due to the city’s multifaceted and resilient economy. Coupled with its investment rates proving more agreeable than those of first tier markets, Nashville’s retail market is poised to see pricing pick up throughout the year, especially in the case of well performing grocery-anchored properties, as well as attractively located power and community centers. Cool Springs Market’s appealing location, as well as the presence of a non-owned Kroger at the site, makes the acquisition one that guarantees healthy returns. CBRE’s evaluation of the market shows cap rates for Class A grocery-anchored properties moving between 7-7.5 percent with an expect tilt below the seven percent mark.

Cool Springs Market’s 5 percent vacancy rate is also above metro Nashville’s 7.8 percent year-end vacancy rate. Tenants include Dick’s Sporting Goods, Marshall’s, Staples and JoAnn Fabrics.

Its $39.5 million purchase price would also place it in the top three purchases of 2012.

Image courtesy of Dwight Burdette via Wikimedia Commons

Chart courtesy of CBRE

Ashford Secures 30-Year Lease for Existing Convention Center

By Eliza Theiss, Associate Editor

Self-administrated real estate investment trust Ashford Hospitality Trust, Inc. announced that it has entered, along with its joint venture partner, a series of agreements with the City of Nashville and Davidson County regarding its ownership of the Renaissance Nashville Hotel and the existing Nashville Convention Center.

According to a press statement, Ashford Hospitality has secured a 30-year lease agreement for 80,000 square feet of meeting and pre-function space at the existing Nashville Convention Center. The existing Convention Center is adjacent to the 673-key Renaissance Nashville Hotel. Ashford has a 71.74 percent ownership interest in the hotel, which with the new lease agreement will be able to offer upwards of 110,000 square feet of self-contained meeting and pre-function space. Before the freshly signed agreement the hotel had access to the Convention Center’s space on an “as available” basis and with additional payment.

Ashford and its joint venture partner also changed their leasehold interest in the hotel, set to expire in 2087, to fee simple ownership, and they extended the lease on some adjacent facilities to 2112. The Renaissance Nashville Hotel is currently undergoing a $20 million value-add renovation. It will also engage in a value-add renovation of the newly leased asset. The latter will be funded from existing capital reserves.

Located at 611 Commerce Street, the existing convention center’s anchor hotel offers amenities such as staffed business center, a 24-hour health club, indoor pool, whirlpool, spa/salon, full service restaurant, two lounges and circa 110,000 square feet of meeting and pre-function space, including two grand ballrooms. The hotel was completed in 1987 and is an AAA 4 Diamond Award winning property.

Image courtesy of Jice99 via Wikimedia Commons

Compass Completes LEED Gold Datacenter in Record Time

By Eliza Theiss, Associate Editor

Standalone data center developer Compass Datacenters has announced completing its first facility in suburban Nashville. Located 20 miles from Music City’s downtown, in Franklin, Tennessee, the 21,000-square-foot data center has finished construction, as well as commissioning. The 1.2 MW standalone data center is leased to a sole tenant, expected to take control of the facility by the end of the month.

The Franklin facility is a record breaking one due to Compass’ patent-pending Truly Modular Architecture ^TM construction and structuring methodology. The usual one or two years it takes to develop such a facility has been reduced to a much smaller six-month time frame from groundbreaking to custumer handover. The company’s data centers are also geographically independent and as such can be located wherever a customer has the need of them.

At the core of the Compass design and construction approach is its CompassPod ^TM, a patent-pending design innovation that offers 10,000 square feet of columness 36-inch raised floor space supported by 1.2 MW of electrical power with 2N power distribution and delivering a power usage effectiveness (PUE) of 1.2 -1.5 or less at lower loads. The pods themselves are the basic building blocks with which Compass creates its facilities—if the need arises, then another 10,000-square-foot pod can be added at any time. The pods are protected by, and located within, the hardened, secure and energy-efficient CompassStructure ^TM. Facilities are built to withstand Class 4 Hurricanes and have the 1.5 seismic importance factor applied by structures such as hospitals.

In addition to the 10,000-square-foot data center pod, the Franklin facility also features a 1,000-square-foot CompassSupport module comprising office space, security center, lobby, loading dock and break area to meet the needs of data center logistics and operational staff. The Tier III-certified modular facility is LEED Gold certified for energy efficiency, using such techniques as free air cooling by synchronizing rooftop air handlers.

The Franklin facility will be taken over by communications and technology services provider and adviser Windstream Communications, a company working with four out of five Fortune 500 companies.

Image courtesy of Compass Datacenters’ Facebook page

Baptist Hospital Opens Specialized Medical Center; Meharry Medical Expands Educational and Housing Facilities

By Eliza Theiss, Associate Editor

Another member of Saint Thomas Health, Middle Tennessee’s not-for-profit, faith-based health system, has announced an important expansion. Following last week’s buzz around Saint Thomas Hospital breaking ground on a $110 million expansion, came the news of Baptist Hospital opening its brand new onsite wound care facility.

The Craig Center for Advanced Wound Healing, located on the Baptist Hospital campus, on the corner of Murphy and 20^thAvenue, provides 20,000 square feet of expanded clinical space and improved accessibility. The state-of-the-art facility now also houses Baptist Hospital’s Diabetes Center.

The project, which broke ground in late February 2012, was designed by Gresham Smith and Partners with Harvest Construction as main contractor. The facility was initially slated to open in November 2012.

The Craig Center for Advanced Wound Healing was named after former President and Chief Executive Officer of National Life and Accident Insurance Company C. A. “Neil” Craig, II, an active philanthropist in the local healthcare community. A donation of $5 million from The Deborah and C.A. Craig, II Family Foundation was decisive in helping the facility be built.

Saint Thomas Health isn’t the only player in the Nashville medical scene that is looking towards the future. NewsChannel5.com recently reported on the expansions at Meharry Medical College. Among them is the biggest build since the seventies: the $25 million Turner Family Center on 21^st Avenue North. The 80,000-square-foot facility broke ground in 2012 and is expected to open in July 2014. The three-story building will contain administrative offices, classroom space, an auditorium and a banquet hall as well as a food court. And while the new educational facility is under construction, the college is gearing up for a new project set to break ground in May. Meharry Medical College will demolish an outdated apartment community on Morena Street and replace it with 100 new student housing units. Meharry is also renovating Lyttle Hall, another student housing property, before an expected increase in college enrollment.

Saint Thomas Starts $110 M Expansion

By Eliza Theiss, Associate Editor

Determined to remain a state-of-the-art healthcare facility, Saint Thomas Hospital has not only announced plans to modernize the healthcare center, but already broke ground on a new structure.

Scheduled to be completed in early 2017, and with a total cost of $110 million, Saint Thomas’ modernization plans aim to upgrade patient-centered care by enhancing patient access and enhancing critical care and surgical services. Construction is set to take place in stages so as not to interfere with patient care.

Among the work planned at the healthcare facility is the construction of a new patient tower, which recently broke ground. The new structure will rise at the back of the campus, next to the visitor’s parking and will house services such as patient admission and pre-admission testing, essentially moving the hospital’s front door to the back of the medical campus. Other important upgrades include the renovation and expansion of 44 critical care rooms. At their current size, critical rooms have a footprint of 195 square feet. Following the expansion this will increase to 275 square feet, allowing for increased patient comfort. Some of the hospital’s operating rooms will also receive a boost in size, and 13 of the 28 operating theaters at Saint Thomas will be augmented to 520 square feet each, making them better suited for orthopedic procedures.

“This investment will make it easier for our patients to navigate within the hospital and will ensure we continue to be a leader in caring for adults in our community,” said Dawn Rudolph, president and CEO of Saint Thomas Hospital. “We want to make sure Saint Thomas Hospital remains a state-of-the-art facility for years to come,” she added.

According to the Nashville Business Journal’s coverage of the story, the new tower will total 155,000 square feet, while the total surface to be renovated within the existing facility is approximately 73,000 square feet.

Freeman White is serving as architect on the project with Turner Construction as construction manager.

Saint Thomas Hospital is a member of the faith-based, non-profit Saint Thomas Health regional healthcare system. The hospital features 541 beds, 40 of which are critical care beds, 90 special care and 140 telemetry beds.

Rendering courtesy of Saint Thomas Health

Local Firm to Receive Award for Restoration of Senior Housing Community

By Eliza Theiss, Associate Editor

Memphis, TN-based Alco Management, Inc. a leading operator of affordable housing, will soon be honored by The National Affordable Housing Management Association (NAHMA) for the turnaround of Riverwood Tower Apartments, a senior living community located in suburban Nashville. Alco’s turnaround of the property is being honored at the Community of Quality Awards March 24-26 in Washington, DC.

“It’s quite an accomplishment to be named a National Community of Quality Award winner,” said NAHMA Executive Director Kris Cook. “The process is competitive and takes into account not just a property’s structure and appearance, but the quality of its management and staff, finances, compliance scores, and other factors.” Riverwood Tower Apartments is the winner of the Outstanding Turnaround of a Troubled Property category.

Formerly known as Madison View Towers, the 33-year-old senior living community located In Nashville’s Madison suburb was purchased by Alco in 2005. At the time, the 117-unit distressed property had an occupancy rate of 76 percent. Following the purchase, Alco renamed the property and in 2006 embarked on rehabilitating the asset. Upgrades include energy-efficiency measures such as water-saving kitchen and bathroom fixtures and appliances, energy efficient windows, new HVAC units, and a new fire alarm and nurse call system, along with a new electronic entry and security camera system, and the expansion of the property’s sprinkler system. Madison View Towers was also given an interior design makeover with reimagined common areas, as well as new flooring, carpeting and a paint job. The community’s parking lot was also redesigned to provide additional accessible parking. The grounds were landscaped. Alco also hired extra management staff.

Following the rebranding and repositioning of the property, Alco turned operations at Madison View Towers cash flow positive and brought occupancy to 100 percent within two years.

Photo courtesy of Alco Management, Inc. via Enhanced Online News

$60M Condo and $80M Apartment Projects Stir Up Nashville

By Eliza Theiss, Associate Editor

Thanks to favorable market conditions, developer LaRawn Scaife Rhea’s 34-unit luxury condominium project The Manning at Belle Meade could soon restart development. According to the Nashville Business Journal, the $60 million project planned for Woodmont Boulevard has been getting attention from potential financing partners. If financing is secured, the project, which was supposed to break ground in January 2008, will start construction by the end of 2013 and units will be put on the market once again.  The Manning condos were originally priced between $950,000 and $5.5 million with about 50 percent of units sold by the time construction halted.

Some of the features planned at the 10-story luxury project included private wine storage, a formal grand salon, extensive walking areas and estate gardens, full-time staff, concierge service, personal trainer service, personal shopping service and pet care service. Units were to range between 1,800 and 6,000 square feet and boast balconies and terraces. According to the Nashville Business Journal, the project’s amplitude has not been curtailed.

LaRawn Scaife Rhea and husband Richard have also developed upper-high-end projects in the US and the Caribbean.

In other multifamily luxury news, Metro Nashville has released a construction permit for foundation work on developer Ray Hensler’ $80 million luxury apartment project, which means things are going smoothly for the highly anticipated development. According to the Nashville Business Journal, the still unnamed $23 million Gulch apartment high-rise, the first one in Music City in over a decade, is set to break ground before the year is out and work will be completed in the second or third quarter of 2014.

Featuring 312 units with some of the largest floor plans in Nashville, rents are expected to range between $1,400 and $3,500 per month. Its luxurious community amenities will include a 2,800-square-foot fitness center, an 82-foot saltwater pool, game room complete with billiards, sky terrace featuring a community kitchen, and hotel-style lobby with round-the-clock concierge and security. A 7,000-square-foot restaurant will also open at the location.

Local firm Hastings Architecture Associates is reportedly lead architect on the project, while JE Dunn Construction Corp. is general contractor.  Ray Hensler’s development partner is Fort Lauderdale-based Stiles Corp. The duo previously developed Sunrise Harbor, the highly-acclaimed $60 million 368-unit Fort Lauderdale luxury apartment project featuring a marina, yacht slips and retail shops.

Photo of Sunrise Harbor courtesy of Sunrise Harbor Apartment’s Facebook page

Chart courtesy of CBRE

First Hotel to Open in Gulch Has $17.5 M Price Tag

By Eliza Theiss, Associate Editor

Details of the first ever hotel to be built in the posh district of The Gulch have surfaced, with the Nashville Business Journal reporting that the property, currently in construction has a development price tag of $17.5 million, just short of $139,000 per unit. The hotel, a future Fairfield Inn & Suits by Marriott is being developed by Chattanooga, TN-based Vision Hospitality with Brentwood, TN-based Biscan Construction as main contractor.

According to a press release the aptly named Fairfield Inn & Suites, Nashville Downtown @ the Gulch will be eight stories tall and feature 126 rooms. The building’s modern design will complement the contemporary Gulch architecture. It will also offer panoramic views of the Nashville skyline. The property, expected to open in the first quarter of 2014, will pursue LEED certification to further integrate itself into the neighborhood—The Gulch has been certified a LEED Green Neighborhood since November 2009.

The hotel will feature amenities such as a 1,500-square-foot meeting room and a rooftop bar, according to the Nashville Business Journal.

Plans to develop the Fairfield Inn & Suites, Nashville Downtown @ the Gulch have been in motion for over a year now. In late 2011 the Nashville Post reported that Vision Hospitality purchased two parcels in The Gulch for $2.3 million. The developer, through its Nashville presence Vision Nashville Gulch LLC, picked up a warehouse from Purcell Development for $1.31 and an adult bookstore from Blue Sky Holdings for a little over $1 million. Both sites are on Division Street, granting the future hotel easy access to Music Row, Music City Center and Downtown Nashville.

Fairfield Inn & Suites, Nashville Downtown @ the Gulch is one of eight hotels either in operation or development by Vision Hospitality. The company’s Tennessee portfolio includes two properties in the Greater Nashville region; the Hyatt Place Nashville Airport and the Hilton Garden Inn Nashville/Franklin/Cool Springs with two additional hotels in development; the Residence Inn and Courtyard by Marriott in Murfreesboro, TN.

Rendering courtesy of Vision Hospitality

West End InterContinental Hotel Will Finally Happen

By Eliza Theiss, Associate Editor

It seems Nashville just can’t get enough of hotels these days. After years of uncertainty, an InterContinental hotel is finally coming to Music City’s West End Summit, the 900,000-square-foot office mega-development helmed by local real estate guru Alek Palmer. The Nashville Business Journal recently quoted the developer as saying the hotel deal is “99.9 percent done.”

The same report also states that the megaproject’s hospitality component will have 230 rooms on 18 floors, and will feature a modern design. The hotel will sit between West End’s two 20-story office towers. The full-service hotel, described as “four-and-a-half stars” is expected to open a couple of months after work on the office towers wraps up in 2015.

Developer Palmer has been trying to bring an InterContinental property to the area for several years now. According to a different Nashville Business Journal report, a slightly larger hotel property, featuring 285 rooms, a 10,750-square-foot ballroom, 18,000 square feet of meeting space, fitness center, spa and several dining venues was announced back in 2006, when West End was rumored to be completed by 2008. In the end, the hotel, along with the entire West End project, got pushed back.

As previously reported here, Alex S. Palmer & Co. will be developing West End Summit in Nashville’s Midtown. The development, one of the biggest in Music City’s history, will create 900,000 square feet of Class A office space, 475,000 square feet of which are already under lease contract to Parallon Business Solutions and Sarah Cannon Research Institute (SCRI), two HCA Holdings Inc. affiliates that will consolidate their operations at 1600 West End. Parallon, which will be taking up 350,000 square feet of office space, will consolidate 750 area jobs at the location, while SCRI will relocate 200 jobs to its 125,000-square-foot lease. With both companies set to increase their workforce by 2017, West End is expected to bring 2,000 jobs to Midtown. A 2,800-car parking garage, high-end retail, signature restaurants and state-of-the-art fitness center will also be created at the site. West End is expected to cost $265 million.

Image courtesy of Alek S. Palmer & Co.

Chart courtesy of Marcus & Millichap