BY Joey Valenti
It’s no secret that the Nashville real estate market has experienced quite a surge in recent years, attracting a variety of retailers, restaurants, and experiential concepts. With growth comes the dreaded growing pains and, in Nashville’s case, a scarcity of vacant lots and available properties. If you’re a prospective tenant/buyer in this competitive market and feel like you’re in a proverbial staring contest with landlords & sellers, here are a few things to keep in mind.
Low Vacancy Rates
Major franchises and national brands are itching to secure sites in Nashville, but basic laws of supply and demand are evolving predictably, and no one can find exactly what they’re looking for when they want it. Lead times for properties remain long. With new construction projects, leases are being signed 12+ months in advance. It’s a difficult market for someone looking to get in quick, sign a lease, and have their transaction done, but those willing to wait are finding what they’re looking for.
Patience & Proactivity
It may seem like an elementary concept, but we recommend our clients get in the car with us and drive the market. In our experience, one of the many unfortunate outcomes of the pandemic and the rise of commercial real estate technology is that people have been less willing to do site selection in person in favor of software and analytics dictating their search. It’s one thing to be on Zoom with a client to get an idea of what they’re looking for; it’s a whole other thing to be driving around together and getting real-time feedback about what would work for them, as well as being able to present options they may not have considered if they just looked at the listing online. Driving the market allows us to connect personally with our clients – we have better conversations about properties that would suit their needs, and it enables us to be more creative with options for them.
Many of our buyers and tenants are finding that their initial desires for a property are not at all what they end up with (if they’re willing to wait out the market). While having certain criteria in mind is obviously essential to narrowing down any property search, being unwavering and overly specific can lead to missed opportunities. Some retailers and restaurateurs go back to the drawing board to reassess their needs, and those are the ones who are able to find a property that works for them.
In Nashville and the surrounding markets, development deals are slower to completion than they used to be, which can be frustrating for all parties involved. So, where’s the light at the end of the tunnel? It’s closer than you might think. We’re about to approach transitioning from a landlord/sellers’ market to a tenant/buyers’ market, and the latter knows prices are coming down. While they’re not coming down immediately, it’s important to position yourself wisely now if you’re looking to get in. We’d love to help you navigate the coming market changes and establish your place in the desirable Nashville real estate landscape.
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