VOL. 37 | NO. 2 | Friday, January 11, 2013
Recession over, Sumner projects progress
By Hollie Deese
For years, Rivergate Mall has the shopping destination of choice for Sumner County residents.
But an ambitious development proposed in the early 2000s could solve Sumner’s retail problem, as well as bring in new office space, dining and mixed-use residential. Indian Lake Village, a development on more than 400 acres, began construction in 2002. The land had previously been owned by one family, in their possession since the Civil War.
“I think a good example, and possibly a barometer for the future of Sumner County is the Indian Lake development,” says Phil Dildine, owner of The Morris Companies and chair for the Commercial Real Estate committee for the Greater Nashville Area of Realtors.
“It is a perfect example of a project that was conceived in the early 2000s, came into play in 2002-2004, and hit the wall like everything else did in this country in 2007-2010.”
Danny Hale, CEO of HALO Realty, was instrumental in getting Indian Lake off the ground and, at a Middle Tennessee CCIM Chapter Luncheon Program in 2009, touted Sumner County as a complete destination for corporate relocation.
“And at the time, he was right,” Dildine says. “He was the catalyst for the securing of the land, planning of the development, and the construction of Indian Lake Village with the open walking mall The Streets of Indian Lake.”
The Streets of Indian Lake opened in 2008 within the development, bringing 182,000 square feet of retail, restaurant and a 16-screen movie theater. But as soon as it was developed, it stalled.
“In 2008, everything stopped when the financial crisis hit,” Hale says. “We went through 2009 and 2010, and it was absolutely at a standstill. But in 2011, we started seeing things coming back, and coming back in a big way.
“And so we have had a pretty good two-year run for commercial development in Hendersonville. Sumner County was just void of retail for so many years, and we are just now coming into the time where the number of people here, and the income bracket that they have, will support that type of retail development. It is just our time to shine.”
Last week, Franklin restaurant Sopapilla’s announced it would be opening in the old September’s space, which has been vacant since April 2011. And dirt is moving elsewhere along Indian Lake Boulevard, including a 40,000-square foot surgery center on three acres, and a warehouse liquor and spirit store.
“We had a real good year last year in Hendersonville,” Hale adds. “Commercial real estate in Sumner County is certainly on the rebound. There is not a lot of speculation in the market, but a lot of end users coming into the market. We think that most of the retailers who want to be in Williamson County are already there. But Sumner County still has a lot of room for growth and retail.”
‘Great employee base’
While Hale says Sumner County operates independently from Nashville, no one argues that Nashville’s proximity is a big perk for companies looking to relocate north of the city. And as Nashville grows, so does Sumner.
“Sumner mirrors what is going on in Nashville, but it certainly has independent appealing factors,” Hale says. “We have a lake in Sumner County which is attracting a lot of executives who, in turn, make decisions about where they are going to locate their businesses. We are seeing a lot more business users come in.
“We have great demographics here – we are 15 minutes to downtown Nashville – and we have great residential projects here like Fairvue Plantation and Foxland Harbor that have just come online. Residential is just starting to come back to Sumner County in a big way.
“Certainly businesses can get employees here cheaper than they can in other parts of the Midstate. There is a great employee base, and those employees have housing choices from the secretary all the way up to the executive.”
Part of Sumner’s appeal is its nearness to Music City, Dildine adds. Plus, residents get the benefits of Nashville, like the pro sports teams and top-shelf entertainment without paying for it.
“We all feed off of Nashville and we get a free ride a lot of the time,” Dildine says. “We don’t pay for the convention center, we don’t pay for the Titans stadium and a lot of things that go on that are really the synergy for the surrounding markets who benefit from it. People like to live out where you can see cows, and still have great places to shop work and play. I see us having made the turn and the future is bright for commercial real estate in Sumner County.”
Getting there from here
Workers who make the commute from Sumner County to Nashville each day know it is no fun, whether you take the 386-Vietnam Veterans bypass or 109 to I-40.
In fact, the Gallatin-Hendersonville-Goodlettsville-Nashville corridor was identified as one of the most pressing in terms of needing alternative transportation solutions in a long-range study done in 2010 by the Metropolitan Planning Organization for their “Bold New Vision for Transit.”
The Regional Transportation Authority took the next step and has undertaken a series of corridor studies, one of which is a more detailed Northeast corridor study that was completed roughly two years ago. Two alternatives were proposed, but only one is recommended.
“One would be some form of light rail between Gallatin and downtown, and that is extremely expensive, as you can imagine,” says Ed Cole, executive director of the Transit Alliance of Middle Tennessee. “There is not much opportunity that there could be anything worked out with CSX to use the rail line, although that technically could be looked at. What is preferred is a bus rapid transit.”
What is suggested would be bus service from Gallatin to downtown with stops in Hendersonville and Rivergate with designated bus only lanes along 386, I-65, Briley Parkway and Ellington Parkway. From there it would connect with MTA’s rapid transit and East-West Connector project, which will connect Five Points to West End and the St. Thomas Hospital campus.
“A requirement would be a partnership with TDOT, because with the bus rapid transit, in order to be effective, it has to have dedicated lanes,” Cole says. “If it can’t run in traffic because I-65 is clogged up there is no advantage. That is the same approach being taken on the East-West Connector.”
Revenue and transit
There has been no formal action to move toward that, mainly because there is no dedicated source of revenue for the project.
“In Denver, in Charlotte, in Austin and other cities more like us who have done this sort of thing, they all have a dedicated revenue source,” Cole says.
“There is a revenue source that goes to transit, it is not part of the city or county budget that has to be argued every year. It is an ongoing source of revenue. And under the Tennessee law that was updated two years ago, the RTA has the ability to bond a project, but it does not have the authority to raise revenue, so that would have to be some decision made by the local government.”
What the majority of those other cities have done, however, is slightly raise their sales tax, something not likely to happen in Tennessee where the sales tax is already just under 10 percent.
“To get an agreement to raise our sales tax would be very difficult,” Cole says. “So there are some real tough decisions ahead and that issue would have to be addressed. Obviously, federal support would be essential. An application would have to be submitted, and they are very competitive awards under the current transportation funding.”
In 2013 the Transit Alliance will be working with local communities around Nashville to discuss transportation options, starting with Gallatin Mayor Joanne Graves, Hendersonville Mayor Scott Foster and others in Sumner County to organize community discussions and drum up more public support.
Local commercial developers are already there.
“Big investments have been made over the past 30 years on I-65 and Vietnam Veterans Boulevard,” Hale says. “We are seeing Highway 109 connect the county all the way to 65 near the state line, so the infrastructure is strong here, and it supports industry, office and retail. We are hopeful that Sumner County will be the next leg of the mass transit program that the regional transit authority is working on and we think that will be a big benefit to Sumner County when that comes.”
While growth is happening again, it will not be the boom experienced in the last decade as the area tries to catch up with what happened then.
“Sumner County, in general I feel, has a tremendous potential for great commercial growth in the future,” Dildine says. “Slow in the near future as we absorb what development that we have left over from the early 2000’s boom building which we see happening already, and very strong in the next five years.”
Of course, he adds, that all depends.
“Builders are gamblers,” he says. “They are sort of playing a waging game of craps, betting on the “come” or the “don’t come.” Typically, they are betting on the “come” and tend to overbuild. But supply and demand is the great equalizers as we saw in the housing bubble burst and its trickle-down effect on commercial real estate.”