TRG | The Bottom Line – 1/28

As we wrap up TRG’s Q4’21 industry survey season and head into earnings season, we look backwards to look forwards. We look this week at our own market, Nashville, to test the temperature of the commercial end market and how it faired in 2021. Granted, Nashville is red-hot now, but even most changes can signal bigger trends for the ongoing wave of population pouring into the Southeast and Southwest. According to Cushman Wakefield, Nashville in 2021 saw a 43.6% YOY increase in leasing transactions (2.8MM sq feet). Pricing inched up 1.6% in 2021 and is expected to move up even more in 2022 with new Class A units coming on the market. Overall vacancy rates were relatively stable at 19.1%. Construction hasn’t stopped, with large build outs from Asurion to Amazon contributing to more than 2.4MM sq feet of construction in 2021. What about 2022? Cushman Wakefield cites more than 3.0MM sq feet of Class A office product currently under construction in the Nashville market, spread among a variety of industries (financial services to healthcare to tech).