Nashville's Tourism Boom: A Force in Commercial Real Estate
Nashville, known affectionately as "Music City," has long been a hub for culture, entertainment, and Southern hospitality. In recent years, the city has experienced an unprecedented surge in tourism, propelling its commercial real estate market to new heights. This surge can be attributed to various factors, including the rise of Airbnb usage, the city's vibrant entertainment heritage, and the thriving restaurant and libation scene.
The Rise of Short-Term Rentals
The growth of Airbnb and other short-term rental platforms is both a result and a contributor to Nashville's tourism boom. These platforms have offered travelers a wide range of accommodation options beyond traditional hotels, from cozy downtown lofts to spacious suburban homes. We've helped construct many of these, including the boutique hospitality property “n o t e” by Mint House. A renovated 1901 property in Nashville's Arts District, "n o t e" is a luxury loft-suite hotel that features amenities like a full-service kitchen, modern bedrooms, and spacious lounge and workspace areas that are ideal for living and business alike.
Eastboro Drive Residential Development, another one of our luxury residential builds, is a 2,500 sq. ft. property that embodies the pinnacle of upscale living. At Eshelman, we oversaw the entire development process for Eastboro Drive, including site acquisition, design, financing, permitting, construction, and the sale. These bespoke lodgings have increased the number of visitors to the city and fueled demand for commercial real estate properties such as apartment buildings, condominiums, and mixed-use developments.
The Expansion of Entertainment Venues
The influx of tourists has also led to a wave in demand for entertainment venues and amenities. Nashville's reputation as a music mecca has attracted visitors from around the globe, eager to explore its iconic music venues, honky-tonks, and live music scene. In 2017, we completed the construction of Nudie’s Honky Tonk Rooftop Patio on Broadway. In this historic preservation project, we renovated and expanded Nudie's Honky Tonk to incorporate a rooftop bar and patio that is open all year long and extra bathrooms to accommodate the crowds. The design element is now a trend for numerous venues in Nashville, from restaurants and bars to other entertainment venues, where a rooftop scene plays a critical part in the overall experience visitors and locals come to know and love.
As a result of this surge, developers have been keen to capitalize on this demand by investing in new entertainment complexes, restaurants, bars, and nightlife destinations. We also see increased music-related attractions, such as the Patsy Cline Museum. We remodeled the second floor of a historic building on 3rd Avenue into a space that celebrates the life of the country music legend. This museum showcases hundreds of never-before-seen artifacts that bring Cline's life and legacy into sharp relief, including personal belongings, wardrobe, records, videos, and more. These developments not only cater to tourists but also enhance the city's appeal to residents, creating a dynamic urban environment that is both lively and diverse.
The Growth of Hospitality and Dining
Nashville's tourism industry has also spurred investment in adjacent sectors of the economy, driving demand for office space, retail storefronts, restaurants, and hospitality establishments. Barrel Proof, a hospitality venue known for its whiskey, beer, and covered outdoor patio, is one of our favorite contributions to Germantown’s scene. In partnership with Remick Architecture, we helped ensure quality craftsmanship throughout the build. St. Vito Focacceria is another hospitality gem located in the Gulch neighborhood. This restaurant, designed by Powell Architects, engineered by DF&H, and developed by us, blends functionality and luxury for tourists and locals alike.
Challenges and Opportunities
With the rapid growth of Nashville's tourism industry has come challenges and opportunities for the city's commercial real estate market. As demand for properties continues to rise, developers must balance the need for new construction with preserving the city's unique character and charm. Additionally, rising property values and rental rates may pose affordability challenges for residents and businesses alike, necessitating careful planning and regulation to ensure sustainable growth.
Nashville's tourism industry has emerged as a powerful catalyst for commercial real estate development, driving demand for properties across various market sectors. From the popularity of Airbnb usage to the proliferation of entertainment venues, the city's spirited culture and welcoming atmosphere continue to attract all kinds of visitors, investors, and transplants. As Nashville continues to evolve and grow, it is essential for stakeholders to work together to ensure that development is balanced, sustainable, and inclusive, preserving the city's uniqueness for generations to come.