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Fifth Third Center Finds $90M Buyer, While Palmer Plaza Starts Looking For One4 Jun 2014, 1:09 pm
By Eliza Theiss, Associate Editor
Palmer Plaza, the 284,000-square-foot office high-rise at the corner of 18th and West End Avenue, is set to go on the market due to the impending maturing of an outstanding loan on the property, reports The Tennessean. The 18-story West End office tower’s owner, entity Palmer Plaza Partners II, has close to $30 million in outstanding debt on the property, which matures in September 2015 and can be paid off by March 2016 without penalty. The ownership might also choose to refinance the loan, instead of selling the property. Real estate investment banking firm Eastdil Secured’s Atlanta office is expected to market the property.
Developed by the Alex S. Palmer-run Alex S. Palmer & Company, the namesake property offers 284,000 square feet of gross space with 15,970 square feet of space per floor. Amenities include an adjacent 700-space, nine-story parking garage, rooftop fitness center with sauna and sun deck and a three-story entrance lobby. The Class A office asset has efficiency features such as reflective glass curtain wall and computerized energy management system. It was designed by architecture firm Gould Turner Group PC.
According to The Tennessean, Palmer Plaza is 94 percent leased, anchor tenants including Marsh, Lend Lease and Bethel University.
In other office news, the 490,276-square-foot Fifth Third Center in Nashville’s downtown is set to sell in June for around $90 million, reports the Nashville Business Journal. The property’s owner, Amstar Group, has selected a yet-to-be-disclosed buyer who will pay in the low- to mid-$180s per square foot for the asset, which Amstar purchased for $62 million in 2007.
Downtown’s fourth largest building, Fifth Third Center’s amenities include an underground parking facility, high-end men’s barber shop, executive shoe shine and a Starbucks. Close to 80 percent occupied, the 31-story tower’s tenant roster includes Fifth Third Bank’s Nashville headquarters, Loews Hotels Shared Services Headquarters, Deloitte and Sony/ATV Music Publishing. According to the Nashville Business Journal, the property is being marketed by Mike McDonald, managing director of Eastdil Secured’s Atlanta office
Images via Alex S. Palmer & Company and Fifth Third Center Nashville
Steadfast Buys Nashville Apartments for $35.2M28 May 2014, 2:00 pm
By Eliza Theiss, Associate Editor
California-based Steadfast Income REIT continues its Tennessee apartment buying spree with the fourth purchase in the state and the third in metro Nashville in eight months. Steadfast’s latest acquisition is the 176-unit Village at Spring Hill, which it purchased for $14.2 million from Villages at Spring Hill LP, according to the Nashville Business Journal. Brentwood-based The Kirkland Co. brokered the $80,680 per unit sale. Located in Nashville’s Spring Hill submarket, the community comprises one-, two- and three-bedroom apartments. According to apartmentguide.com the community’s amenities include a 24-hour fitness center with sauna, swimming pool, lighted tennis court, pet park, playground and picnic area with grills.
The California investor also purchased the 190-unit Richland Falls community in Murfreesboro, TN, paying $21 million for the community only two weeks ago. The newly constructed community comprises nine multi-story buildings totaling 190 one-, two- and three-story apartments averaging 1,026 square feet and average in-place rents of $892. Richland Falls comprises 18 acres, part of which has the ability of holding an additional 86-unit phase. Amenities include a fitness center, outdoor swimming pool, dog park, billiards lounge and business center.
“Steadfast Income REIT’s acquisition focus has been to focus on properties in flourishing markets,” said Ella Shaw Neyland, president of Steadfast Income REIT. “Murfreesboro and the Nashville area are high on national rankings for economic strength, attractiveness to business, population growth and job growth.”
With the acquisition of Richland Falls and Village at Spring Hill, Steadfast now owns 67 communities in 11 Southern and Midwestern states. Barring the latest acquisitions, the company’s Nashville portfolio includes the 206-unit Cantare at Indian Lake, 90-unit Keystone Farms and 256-unit Audubon Park. According to The Tennessean, Steadfast picked up Cantare for $29 million, while Keystone was bought for $8.4 million.
Images via Facebook
Athena Companies Buys 100-Key Asset in Booming Nashville Hotel Market22 May 2014, 1:49 pm
By Eliza Theiss, Associate Editor
Hunter Hotel Advisors recently advised on the sale of three MainStay Suites for Choice Hotels International in three secondary US markets: Nashville, Pittsburgh and Greenville, SC. All three hotels were acquired by regional investors, attracted to the extended stay model of prime location hotels. The total purchase price was $12.2 million, although the assets were sold individually. Athena Companies paid $4.6 million for the Nashville property, Shiv Hospitality paid $4.5 million for the Pittsburgh asset, while the Greenville MainStay was picked up for $3.1 million by Paragon Hotel Companies.
“Their robust interests in these assets reinforce the importance that investors place on strong locations even if they are in secondary markets,” said David Perrin, a senior associate at Hunter Hotel Advisors’ DC office and the broker of the transaction. According to Hunter Hotel Advisors, regional investors are fueling robust activity in secondary markets.
“Demand for well-located hotels in secondary markets is extremely high.” David Perrin told CPE. “Investors can produce high returns in markets other than New York and San Francisco, as long as the hotels are well positioned within the particular sub-market and they keep the property updated to compete with new supply.”
The new owners of the three recently sold properties are following this trend, planning full renovations to all rooms and public areas in order to upgrade the hotels to current Mainstay standards, which include a fully equipped kitchen, flat panel TVs and free high-speed internet.
The Nashville property currently features amenities such as a pool, fitness room and continental breakfast. The hotel, operating as MainStay Suites Brentwood/Nashville, comprises 100 keys.
According to David Perrin, Nashville is a prime example of a city whose suburbs are benefiting from an influx of investments to the city. “Nashville continues to be one of the hottest hospitality markets in the country,” Perrin told CPE. “Some are beginning to worry about the impact the large amount of new supply will have, but with the new convention center, a heavy focus on the Healthcare industry, and a strong University system, Nashville should not have a problem absorbing the new rooms coming into the market,” he added.
Images courtesy of Hunter Hotel Advisors and Ben Rose Photography
Starwood Plans to Fill Void of Full-Service Hotels in Downtown Nashville14 May 2014, 4:10 pm
By Eliza Theiss, Associate Editor
While Nashville’s swanky $600 million Music City Center has brought great profits for the local hotel market, especially in the downtown area, things aren’t working exactly as they should. More to the point, business isn’t as good as it could be for the year-old convention center. According to the Nashville Business Journal, in its first eight months of operation, the 1.2 million-square-foot convention center was passed over by no less than 16 massive conventions due to a shortage in downtown’s high-end hotel inventory. In fact, downtown Nashville would need up to 1,000 more full-service hotel keys in the downtown sector to adequately accommodate the sheer number of visitors brought in by the massive conventions Music City Center can hold.
That void could be partially filled by a 430-key The Westin Nashville, recently announced by Starwood Hotels & Resorts Worldwide, Inc. “Demand for this city is at a historic high. The addition of the Westin to our hotel package will help ensure our continued success,” said Butch Spyridon, president and CEO of the Nashville Convention & Visitors Corp., adding that “… a brand that is new to Nashville makes this a perfect fit. And the timing couldn’t be better.”
Certainly the new hotel could not be located more conveniently to Music City Center, as it will be built at 100 Clark Place, right across from the new convention center on the Cokesbury site previously acquired for $8.2 million. Set to break ground this summer and open in early 2017, the hotel will be owned by Nashville Hospitality Capital, LLC and managed by Wischermann Partners, Inc.
The 430-key hotel will feature 25,800 square feet of state-of-the-art meeting and events facilities, a business center, the brand’s signature WestinWORKOUT fitness studio, a rooftop pool and lounge, an indoor pool, a full-service spa and a signature restaurant.
The hotel will also be within walking distance of the lower Broad, The Gulch, Ryman Auditorium, Bridgestone Arena and downtown’s myriad of shopping, dining and entertainment venues. Music Row, the Country Music Hall of Fame and The pantheon will also be easily accessible. Separated by less than eight miles from Nashville International Airport, The Westin Nashville will also offer access to the offices of KPMG, AT&T and Deloitte.
According to the Nashville Post, the Metro Development and Housing Agency design review committee has to approve the exterior design of the hotel before the project can move forward. The developer is expected to submit renderings soon.
Image via tvsdesign and Google Maps
$95M Sale of Elliston 23 Breaks All Records in Nashville Apartment Market7 May 2014, 8:05 pm
By Eliza Theiss, Associate Editor
Franklin, TN-based Southern Land Company has announced the sale of Elliston 23 Apartments to Dayton, OH-based The Connor Group for $95.1 million. The sale broke several records—it’s the highest price paid for one apartment community by The Connor Group, the highest price paid for one apartment community in the Nashville market, and the highest price per-unit sale in the state of Tennessee. At over $287,000 per unit, it surpassed previous record holder Vista Germantown by over $65,000 per unit.
The Silver LEED-certified mixed-use development in the Elliston Place block of Nashville was owned by 2300 Elliston Place LLC, a joint venture comprised of Southern Land Company and institutional investors advised by J.P. Morgan Asset Management. The property was originally listed on the market in mid-February and garnered significant interest prior to the final offer. Southern Land served as developer, architect, general contractor and property manager for Elliston 23, which had a price tag of $60 million.
Completed in late 2013, Elliston 23 features 331 luxury residential units and 15,000-square feet of commercial space. The community offers 20 different one- and two-bedroom floor plans ranging between 554 and 1,363 square feet. At an average rental rate of $2.20 per square-foot, rents range between $1,300 and $3,000. At the time of closing, E23 boasted a 75 percent occupancy and 82 percent leasing rate for an averaged lease-up speed of over 30 units per month.
Amenities at the luxury community include a 2,000-square-foot heated saltwater pool (Nashville’s largest), 1,000-square-foot fitness center, six-floor parking garage, dog park, game room, two landscaped courtyards, grilling stations, controlled access and a resident lounge which hosts the live tweeting parties of the cast of hit TV series Nashville, Southern Land told MHN. Other neat facts MHN found out? Elliston 23 is the only Nashville property with exposed concrete ceiling and walls and the benches in front of the property are made out of repurposed stone. Due to Southern Land CEO Tim Downey’s wishes to preserve some of the history of the Father Ryan High School, which occupied E23’s site between 1928 and 1991, the stone was sourced from the previous structure. E23 boasts a walk score of 92.
The 15,000-square-foot street-level retail component is also fully leased to local and national retailers such as Dunkin Donuts, Massage Envy, Jamba Juice, Fresh To Order, Nama Sushi Bar, Juel Salon and Dailey Method (barre), some of which established their first Tennessee locations at E23.
Sitting on three acres of some of the most desirable land in Nashville, the six-story luxury apartment is located at the center of the “eds and meds” job base afforded by three major hospitals (Vanderbilt Medical Center, Centennial Hospital and Baptist Hospital) and Vanderbilt University campus. Also within walking distance are the 132-acre Centennial Park, the Centennial Sportsplex and the dynamic West End Avenue commercial corridor with its myriad dining, shopping and entertainment venues.
The purchase of Elliston 23 is The Connor Group’s second foray in the Nashville market, after the $60.5 million purchase of Ashton Brook in 2013.
The “Day in the life” promo video of E23, created by Southern Land Marketing Manager of Multifamily Operations Morgan Porter and Glenn Sweitzer of Fresh-Design, received a 2014 Telly award.
Click here to read the MHN interview with Southern Lands’ VP of mixed-use development Michael McNally
Images courtesy of Southern Land Company