2012 Global Market report - NAI Global

Clarksville, Tennessee
Knoxville, Tennessee
Contact
NAI Clarksville
+1 931 648 4700
Metropolitan Area
Economic Overview
2011
Population
2016 Estimated
Population
Employment
Population
Household
Average Income
Median
Household Income
Total Population
Median Age
280,688
308,401
120,157
$56,972
$46,654
30
Clarksville is the fifth largest city in the state of Tennessee and
the 17th fastest growing city in the United States. The city of
Clarksville, adjacent to Fort Campbell Military Base, enjoys an
expanding and diverse industrial base, a vibrant residential
market and is home to Austin Peay State University.
Hemlock Semiconductor Corporation, one of the world’s
leading suppliers of polycrystalline silicon products, is
currently constructing a $1.5 billion facility which will
become operational in late 2012. Conwood Corporation, a
subsidiary of R. J. Reynolds, recently purchased a 193 acre
site and will invest $130 million expanding their existing
operation in Clarksville. Bridgestone Metalpha and Winn
Marine have also announced $75 million and $50 million
expansions of their existing facilities. Other corporate
citizens with manufacturing facilities in Clarksville include
The Trane Company, Jostens, Florim, US Zinc and the Robert
Bosch Corporation.
Austin Peay State University is the fastest growing university
in the Tennessee Board of Regents system with enrollment
exceeding 10,000 students. APSU offers 57 majors allowing
students to earn a bachelor’s, master’s or education
specialist’s degree. In addition, the university boasts two
accomplished Centers of Excellence and four Chairs of
Excellence.
There is a good supply of new land available for retail, office,
industrial and residential development. Land prices are
typically lower than those found in comparable markets.
Currently there is a shortage of warehouse space primarily
resulting from the entrance of Hemlock Semiconductor and
related suppliers to the market.
Construction of retail space has slowed due to the national
economy. However, Clarksville enjoys a stable retail
environment as evidenced by increased sales tax
collections. CNN Money recently ranked Clarksville as the
fourth best metro area to launch a business.
Clarksville has been recognized as one of the 20 best
performing cities in the country’s 200 largest metro areas.
In 2010 Business Facilities Magazine ranked Clarksville as
the number four city nationwide for Alternative Energy
Industry leaders.
Contact
NAI Knoxville
+1 865 777 3030
Metropolitan Area
Economic Overview
2011
Population
2016 Estimated
Population
Employment
Population
Household
Average Income
Median
Household Income
Total Population
Median Age
798,719
842,042
407,381
$58,429
$45,155
40
The Knoxville market has witnessed signs of improvement
from 2010. General activity from prospective tenants and
buyers remains low; however overall vacancy has decreased
and Knoxville is experiencing positive absorption. A major
hail storm in late April brought an influx of contractors to
town to handle repairs resulting in a short term spike
in absorption in the flex space market for spaces under
3,000 SF.
Businesses are starting to get a sense of optimism, and
office leasing transactions during 2011 have started to
return to the normal three and five year lease terms although
concessions are still being provided in the form of free rent.
Tenants are relocating to save rental costs, but very little
expansion is occurring. The number of office sales has
increased, however, except for Class A properties, prices are
down 30% to 40% from pre-recession levels.
Knoxville’s industrial market has shown some signs
of recovery from 2010. The seemingly continual
announcement of manufacturing businesses closing
has ceased and the vacancy rate has improved. Some
noteworthy positive activity includes Teledyne Brown
Engineering, Inc. moving into a new 109,034 SF building
and Midlab Inc. purchasing 100,000 SF. However, GE Energy
closed a 360,000 SF distribution facility and activity remains
slow as many businesses are unsure of what the future
holds.
Many new grocers have announced their entry into
the Knoxville retail market. Some of these include Whole
Foods, Trader Joe's, Publix and Costco. Other noteworthy
transactions include a new 100,000 SF Kroger's and
Target’s 110,000 SF store at the new NorthShore Town Center.
Multifamily occupancy has risen steadily, encouraging both
new developments and new investors to the area. The
largest ground up developments are Amberleigh Bluff
(Southwest Knox County) with 336 units and Legends at
Oak Grove (North Knoxville) with 264 units. The largest
transactions include Bristol Park with 208 units
at $18,300,000 and Spring Meadow with 248 units at
$11,525,000. 2012 is expected to bring several new
multifamily development announcements as well as strong
transactions for cash flowing, reposition and REO
properties.
Clarksville At A Glance
(Rent/SF/YR) low High effective avg. Vacancy
doWntoWn offIce
New Construction (AAA)
Class A (Prime)
$
$
14.00
12.00
$
$
18.00
14.00
$ 16.00
$ 13.00
5.00%
12.00%
Class B (Secondary)
suburban offIce
$ 8.00 $ 10.00 $ 9.00 5.00%
New Construction (AAA)
Class A (Prime)
Class B (Secondary)
IndustrIal
$
$
$
17.00
17.00
14.00
$
$
$
22.00
22.00
16.00
$ 19.50
$ 19.50
$ 15.00
8.00%
8.00%
10.00%
Bulk Warehouse
Manufacturing
High Tech/R&D
retaIl
$
$
1.75
3.00
N/A
$
$
4.25
4.00
N/A
$
$
3.00
3.50
N/A
3.00%
5.00%
N/A
Downtown
Neighborhood Service Centers
Sub Regional Centers
Regional Malls
$
$
$
$
10.00
14.00
17.00
20.00
$
$
$
$
14.00
18.00
20.00
30.00
$ 12.00
$ 16.00
$ 18.00
$ 25.00
9.00%
6.00%
5.00%
10.00%
deVeloPment land Low/Acre High/Acre
Office in CBD
Land in Office Parks
Land in Industrial Parks
Office/Industrial Land - Non-park
Retail/Commercial Land
$
$
$
$
345,000.00
215,000.00
87,500.00
N/A
345,000.00
$ 875,000.00
$ 450,000.00
$ 175,000.00
N/A
$ 650,000.00
Residential
$ 15,000.00 $ 55,000.00
Knoxville At A Glance
(Rent/SF/YR) low High effective avg. Vacancy
doWntoWn offIce
New Construction (AAA)
Class A (Prime)
Class B (Secondary)
suburban offIce
New Construction (AAA)
Class A (Prime)
Class B (Secondary)
IndustrIal
$
$
$
$
N/A
15.00
12.00
N/A
19.00
11.50
$
$
$
$
N/A
17.00
15.00
N/A
24.50
16.00
N/A
$ 16.00
$ 13.00
N/A
$ 21.00
$ 14.00
N/A
16.00%
16.00%
N/A
15.40%
17.00%
Bulk Warehouse
Manufacturing
$
$
1.90
2.00
$
$
3.50
4.00
$
$
2.95
3.00
12.00%
12.00%
High Tech/R&D
retaIl
Downtown
Neighborhood Service Centers
Community Power Center
Regional Malls
$
$
$
$
8.00
8.00
7.00
12.00
N/A
$
$
$
$
20.00
22.50
19.00
24.00
N/A
$ 12.50
$ 15.25
$ 14.50
$ 19.00
N/A
6.00%
8.00%
15.00%
10.00%
N/A
deVeloPment land Low/Acre High/Acre
Office in CBD
Land in Office Parks
Land in Industrial Parks
Office/Industrial Land - Non-park
$
$
$
150,000.00
N/A
20,000.00
30,000.00
$
$
$
260,000.00
N/A
80,000.00
284,000.00
Retail/Commercial Land
Residential
$ 190,000.00
N/A
$ 1,000,000.00
N/A
2012 Global Market Report n www.naiglobal.com 135