WE KNOW NASHVILLE

The Five Points-area building long home to Family Dollar has been sold for $2 million.

Nashville-based Magnolia Capital Investments was the buyer. Ben Bonner, Magnolia Capital president, told the Post the company plans to continue to use the building for retail purposes and is looking to rent the space. Family Dollar ceased operations last week.

Family Dollar Stores of Nashville TN was the seller. The acquisition follows Magnolia Capital’s recent $12.6 million purchase of the Green Hills building last home to Nashville-based prison management company CoreCivic Inc.

Constructed in 1986 and spanning about 6,750 square feet, the nondescript Five Points brick building has an address of 1000 Woodland St.

“We believe in the real estate and the neighborhood, and are excited to be a part of Five Points,” Bonner (pictured) said, adding some upgrades are planned. “This property fits well with Magnolia’s strategy to purchase well-located real estate in core and emerging submarkets.”

Austin Benedict and John Maxwell, brokers with the Nashville office of CBRE, represented Magnolia in the acquisition and will also rep the company in finding a tenant.

Family Dollar Stores of Nashville TN acquired the 0.56-acre property from Exxon Corp. in October 1985 for $100,000. That entity is affiliated with Charlotte-based Family Dollar.

Sources said the closed Family Dollar will not reopen within the area.

A Four Seasons hotel is being planned for the downtown development to replace Market Street Apartments in SoBro.

The Post has learned from sources that Second Avenue Partners (SAP), which plans to redevelop the site with a mixed-use tower, is having discussions with officials of the high-end hotel operator. Nashville does not offer a Four Seasons, with the closest being located in Atlanta.

Richard Kershaw, senior project manager with The Congress Group (which is part of SAP), emailed the Post the following:

“As we have previously stated, we are in advanced negotiations with a five-star hotel brand. While we have made exciting progress, we do not have an agreement in place to announce at this time.”

Nearly two and a half years after proposing a $350 million, two-tower project overlooking the Cumberland River and to replace the Market Street Apartments at 150 Second Ave. S. in SoBro, the development team behind the since-altered plan is prepared for the next step in the process and an early 2019 start.

SAP is a combination of Grand Rapids, Michigan-based Northern Capital Investments, the aforementioned The Congress Group and AECOM Capital Real Estate.

To rise 40 stories and offer luxury condominiums and a five-star hotel, the building (see building in the left center of the above rendering) currently is being called 151 1st Avenue South, which derives from its address. A previous iteration had the project offering a two-skyscraper arrangement. At 540 feet, the building would rank among Nashville three tallest were it standing today.

Of note, SAP has leased space in the 222 2nd building, located near Market Street, for the project’s use, the company confirmed.

Austin-based Endeavor Real Estate Group and Granite Properties of Dallas have landed a foundation permit for the first building of their three-phase mixed-use project Gulch Union.

To be called 1222 Demonbreun, the office tower (pictured) will front 13th Avenue North from McGavock Street to Demonbreun. Dallas-based HKS is serving as the architect, with the 20-story building to offer 330,000 square feet of Class A office space and 6,000 square feet of retail.

Of note, Endeavor and Granite are undertaking 1222 Demonbreun (the address for which derives from the name) on a speculative basis. The building is expected eventually to be joined by a 16-story hotel tower and a 28-floor residential high-rise.

The Nashville office of New York-based Turner Construction is the general contractor. The permit is valued at $3.25 million.

Work finished on Broadstone Gulch

Alliance Residential Co. has completed work on Broadstone Gulch, the Phoenix-based company’s high-rise apartment building located at 803 Division St.

The 14-story, 238-unit building is the first residential high-rise to open in The Gulch neighborhood in more than four years. It is also the tallest building located south of Peabody Street and east of Overton Street.

Broadstone Gulch is Alliance Residential’s third apartment project in Nashville, following buildings in Germantown and Melrose. Designed by Atlanta-based The Preston Partnership, the building includes a mix of studio, one-bedroom, two-bedroom and penthouse units. Unit sizes range from 506 to 1,667 square feet, with rents starting at $1,565.

Of note, the building offers in its so-called sky lounge a "professional grade demonstration kitchen." A “BBQ and Brews” event, featuring Gulch neighbors Peg Leg Porker and Yazoo Brewery, recently was held.

“Location is a bigger priority to renters than ever before,” Alliance’s Todd Oglesby said in a release. “Broadstone Gulch is only a short walk away from some of the best restaurants and shops in Nashville, as we are situated in a thriving, walkable destination neighborhood.”

Summer 2019 completion eyed for first phase of industrial project

A joint venture between Indianapolis-based Strategic Capital Partners and New Jersey-based PGIM Real Estate is eyeing a summer 2019 completion for the first phase of industrial development Midway840.

It will be the partnership’s initial project in the general Nashville market. A release does not note the cost to undertake the development at the intersection of Couchville Pike and Interstate 840, which is being billed as suitable for e-commerce and logistics operations.

The partnership owns the 44 acres for the project. Phase One will be a 670,000-square-foot industrial building that is expandable to over 800,000 square feet. The project includes a second phase that will deliver more than 1.5 million square feet to the industrial market.

“We believe that the Nashville industrial market will continue to grow and benefit from e-commerce, its strong central location, its proximity to a growing population and a strong interstate highway system. Nashville is increasingly included as a location of choice for large distribution requirements,” said Richard Horn, CEO of Strategic Capital Partners and a former president of Duke Realty.

The local office of ARCO Construction will provide design/build services. Atlanta-based planning and design firm Kimley-Horn, which has an office in Nashville, will serve as project engineer. Nashville-based Pinnacle Bank is the construction lender and Steve Preston and Hayes McWilliams with CBRE Nashville’s office will handle leasing.

Office vacancies increase

Nashville’s office vacancy rate rose in the third quarter to 9.8 percent, a jump largely due to newly constructed vacant space coming online, according to Cushman & Wakefield’s local office.

The vacancy mark in the third quarter of 2017 was 7.7 percent, the Cushman & Wakefield report notes. Cool Springs saw the largest quarter-over-quarter increase, reaching 11.5 percent, driven by the addition of almost 180,000 square feet of vacant space at Mallory Green.

Meanwhile, vacancy continued to tighten in Nashville’s central business district, where the rate fell for the third straight quarter to 11.4 percent. Class A vacancy increased quarter-over-quarter to 10.5 percent.

Overall vacancies could continue to rise, the report notes, as an additional 1.2 million square feet of space is set to come online by the end of 2020, although some pre-leasing is expected in those projects.

Read the full report here.

Branding weighs in on 24-story tower eyed for CBD

The Post recently reported that officials with downtown-based Christ Church Cathedral have approved an agreement to lease one of their CBD parking lots to the owner of the nearby Holston House Nashville boutique hotel — a move that could yield a 24-story mixed-use building (read here).

We asked Nashville-based real estate research specialist Ed Branding to offer his take on the would-be project. Branding's view is as follows:

“While HRI Properties has not yet released the plan for its mixed-use building, they have a wide range of uses from which to select: residential, office, hotel (and ‘a hotel's two best friends, restaurants and retail’), perhaps something institutional to adjunct with or extend the mission of Hume Fogg High School. They pretty much have the pick of the yard. Which is appropriate, since diagonally adjacent to the northwest is the leviathan-aborning Nashville Yards development on land that, like these parcels, was once owned by Lifeway Christian.

“The city wants to continue what began 20 years ago, downtown shifting from a 9 to 5 business district to a 24/7 fun place to be. So, this area also allows entertainment venues (although some of the trials at the federal courthouse a block away would seem to fill that quota). And this is a steep hill up which to pedal a tavern from the main entertainment area, Lower Broad, so it is unlikely. But they could.

“The central sub-district of the downtown core is intended to have the highest density in the county, with higher intensity encouraged north of Broadway than south, so 24 stories on a half-acre of land is right up Nashville Next's alley. And they could go 30 stories. More if they used the downtown code's bonus height program to add affordable units to, say, house some of the people who work at the bottom of the hill but have to drive in from Dickson and the far end of Central Pike because that's as close in as they can afford to live.

“One major difference between this property and those at the bottom of the hill is the absence of the Metropolitan Development and Housing Agency. The MDHA Capitol Mall Redevelopment District ends diagonally to the northeast, the site of the new federal courthouse. If HRI goes with hostelry, it will be interesting to see if an upscale hotel can be built in this town without using tax increment financing money from MDHA, which could then direct that money toward parking and workforce housing, the most pressing needs downtown.

“The other big question is a short one that arises circles us back to the Yards: Will what HRI builds compete with or complement Nashville Yards?”

Also: Variance sought to allow east side tiki bar

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