Just like the city’s hot chicken, Nashville’s hospitality market continues to emulate Hattie B’s “Damn Hot” and “Shut the Cluck Up” level of on fire.
If you have been to The Music City within the past three or so years, you’ve seen first-hand how many cranes were hauling materials for hotels and other buildings under development. It almost seemed to be taking on the nickname of “The City That Never Sleeps.”
So how sustainable is all this hype? Is it really flourishing as much as the headlines make it out to be?
When this blog publishes, I will be in Nashville for the Hotel Data Conference, and I will be sure to report back to you all how much the city’s skyline has changed and what the general atmosphere is like.
Until then, let’s take a look at some recent activity across the market. The latest project to break ground on July 1 is a new 292-room Hilton hotel at the Nashville International Airport via a development partnership between Chartwell Hospitality and Rockbridge. This shows that companies are wiling to take a bet on the future of the city, as this project is part of an overall enhancement of the Nashville International Airport. News site and magazine Airport World reports the Nashville airport "aims to become one of the most modern gateways in the U.S. and a future large hub, and despite the impact of COVID-19, it is well on its way to achieving at least one of those goals.”
Nashville is also becoming home to several luxury hotels. This move seems to be raising its status to more than “a country music hub,” Bloomberg reports.
“Over the next three years, Nashville is expecting an influx of five-star hotel brands that include 1Hotel, Edition, Conrad and Ritz-Carlton,” the news outlet reports.
Not only has development been on the upswing, weekly STR data continues to call out Nashville — one the top 25 U.S. markets — as among the front runners in the recovery.
Another interesting trend I’ve noticed recently is the number of hotels trading in the city. Transactions in the past two months include the SoBro’s Cambria Nashville Downtown Hotel for $109.5 million; the 21c Museum Hotel Nashville for $59 million; and the Five Points’ Vandyke Bed & Beverage.
Leslie Hale, president and CEO of Bethesda, Maryland-based real estate investment trust RLJ Lodging Trust, the buyer of the 124-room 21c property, said in a news release that Nashville is “a burgeoning destination that is poised to outperform throughout this cycle.”
So why does Nashville remain such an appealing place to build and buy? I’m willing to guess that it has to do with being a Sun Belt state, having a thriving economy as several companies are relocating their headquarters there, experiencing a population boom that has brought nearly 400,000 new residents to the metropolitan area, being among the best states in terms of its tax systems, and — it’d a large omission if I failed to mention — its budding entertainment/night life. Raise your hand if you know someone whose had their bachelorette party in the city.
There’s plenty of evidence pointing to this resurgence being more longstanding than I might have thought. Hoteliers, are you actively looking to enter the market? Why or why not? Is it worth the investment? Are you willing to search for the perfect development site to become available or wait for existing deals to be listed? Let me know via email, Twitter or connect with me on LinkedIn.
P.S., I will be making a tally mark for each bachelorette party I see this week as I venture to Hattie B's.
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