Appendix: Visions for Nashville’s East Bank
Have you read our Visions for Nashville’s East Bank blog post yet? Read the blog to learn more.Appendix A: Parking Construction Comps
The $40m estimate for the parking structure’s construction was reached using the following information
Construction Industry Estimates
WGI, one of the national leaders in parking solutions, prepared its annual analysis of parking structure construction costs. Released in May 2019, the analysis (located https://wginc.com/parking-outlook/) indicates a cost of $33-35m based on average Nashville projections and $37.5-39m based on national average projections.
Direct Comps
The First Tennessee Park/Nashville Sounds parking garage opened in April 2016 … 4 levels/1000 spaces, 360,000 sq ft … cost $18m
505 Church Street/5th Ave Parking Garage opened in December 2016 … 6 levels/900 spaces + 17,000 sq ft of retail space + rooftop amenities for 505 Building … cost $35.5m
BNA Airport Parking currently under construction … 6 levels/2000 spaces + Transportation Center & other aspects … cost $122m
Tampa International Airport Parking Garage V opened in 2006 … 2 phases; 6 stories/5600 spaces (completed in 2 phases … 3700/1900), 2m sq ft … cost $67m
Appendix B: Property Tax Comps
Information available on the property assessor’s website was used to estimate current property tax payments for the most likely uses of the MUI zoned land for Parking Lots E&F, with the presumption that any construction on that land would likely be capped at a max height of 20 stories. Any comp on buildings taller than 20 stories includes a multiplier to reduce property tax to a reasonable estimate of a 20 story comp.
Apartments…
SoBro Apartments – 33 stories, 0.75 acres ($125m appraised, $50m assessed, $1.57m in taxes)
… 60% of assessment $940k in taxes paid
505 Building Apartments – 29 stories in 45 story tower, 0.42 acres ($118.5m appraised, $47.4m assessed, $1.50m in taxes)
… 65% of assessment $975k in taxes paid
Cumberland Apartments – 18 stories, 0.6 acres ($52.7m appraised, $21.08m assessed, $665k in taxes)
20 & Grand – under 20 stories, 0.69 acres ($16.6m appraised, $6.64m assessed, $209k in taxes)
Aertson Hotel/Apartments – 17 stories, 1.85 acres ($140.5m appraised, $56.2m assessed, $1.77m in taxes)
Stacks on Main (535 Main) – 5 stories, 3.26 acres ($41.1m appraised, $16.4m assessed, $519k in taxes)
Eastside Heights Apartments – 5 stories, 2.17 acres ($47m appraised, $18.8m assessed, $593k in taxes)
Hotels…
Cambria – 15 stories, 0.58 acres ($57.88m appraised, $23.15m assessed, $730k taxed)
Westin – 27 stories, 1.38 acres ($148m appraised, $59.5m assessed, 1.87m taxes)
… 70% of assessment $1.31m in taxes paid
TriBranded on KVB – 20 stories w/pkg, 1.08 acres ($99.9m appraised, $39.96m assessed, $1.26m taxes)
Holiday Inn 4th & Peabody – 16 stories w/pkg, 0.57 acres ($47.17m appraised, $18.47m assessed, $582k taxes)
Hilton Garden Inn – 10 stories, 1.44 acres ($75.9m appraised, $30.36m assessed, $957k in taxes … sold for reported $125m in Dec 2018)
Doubletree – 13 stories w/pkg, 0.97 acres ($70.17m appraised, 28.06m assessed, $885k taxes)
Noelle – 13 stories, 0.28 acres ($28.38m appraised, $11.35m assessed, $358k taxes)
The Bobby – 11 stories w/pkg, 0.49 acres ($34.02m appraised, $13.6m assessed, $429k taxes)
Office Buildings…
UBS Tower – 29 stories, 1.82 acres (sold for $135m in March 2019) … $1.70m in taxes
… 65% of assessment $1.1m
Bridgestone Tower – 34 stories, 0.99 acres ($189m appraised, $75.5m w/b assessment, $2.38m taxes)
… 55% of assessment $1.31m
3rd & Lea – 10 stories (half pkg), 0.83 acres ($45m appraised, $18m assessed, $568k taxes)
There are multiple ways the land could be used, and at the end of the day it would be up to the developer to decide the vision for the land, but for the exercise of estimating property tax value, if the land were to be developed without regard for aesthetics or balanced uses the property tax implications would line up:
Lot E (2.55 acres)
With all hotels… ($2.35m)
Noelle - 7 versions = 1.96 acres = $2.5m
Bobby – 5 versions = 2.45 acres = $2.14m
Holiday Inn – 4 versions = 2.3 acres = $2.32m
Cambria – 4 versions = 2.32 acres = $2.92m
TriBrand – 2 versions = 2.16 acres = $2.52m
Doubletree – 2 versions = 1.94 acres = $1.77m
With Office Bldgs… ($2.0m)
UBS – 1 version w/ 0.7 ac left (add Holiday Inn) … $1.68m
Bridgestone – 2 versions … $2.62m
3rd & Lea – 3 versions … $1.7m
With Apartments (condos bring in higher property taxes than apartments) … ($2.7m)
SoBro – 3 versions = 2.25 acres = $2.82m
505 Bldg – 5 versions = 2.1 acres = $7.5m
Cumberland – 4 versions = 2.4 acres = $2.66m
Lot F (4.4 acres)
With all hotels… ($5m)
Holiday Inn – 7 versions = 3.99 acres = $8.82m
Cambria – 7 versions = 4.06 acres = $5.11m
TriBrand – 4 versions = 4.32 acres = $5.04m
Doubletree – 4 versions = 3.88 acres = $3.54m
With Office Bldgs… ($2.8m)
UBS – 2 versions = 3.64 acres w/ 0.76 ac left (add Holiday Inn) … $2.78m
Bridgestone – 4 versions = 3.96 acres … $5.24m
3rd & Lea – 5 versions … $2.84m
With Apartments (condos bring in higher property taxes than apartments) … ($4m)
SoBro – 5 versions = 3.75 acres = $4.7m
505 Bldg – 10 versions = 4.2 acres = $9.75m
Cumberland – 6 versions = 4.14 acres = $3.99m
Maximized for volume on the land, the property tax estimates run over $6m. But it is more reasonable to project that the land would be developed with more of a multi-use complex with public and driving consideration worked into a more aesthetic blueprint.
Starting with the land currently used for Parking Lot F, when tied to the MDHA land along the river (and with air rights provided for a walking bridge over the railroad tracks) would make a prime location for residential development. The inclusion of a beach/marina access on the MDHA parcel (093-02-0-067) would help fill Metro’s mission of better utilizing the Cumberland River.
With the proximity to both the Stadium and the downtown business core, plus the absence of major hotel chains in the East Nashville area, the parcels would also be ripe for hotel development, perhaps a mixed use hotel/residential concept like the Aertson in midtown or like the Four Seasons project just underway in SoBro (South Broadway). And with all of the new businesses expanding to Nashville, new Class A office space would also be welcomed by the Chamber of Commerce (although significant square footage of new office space is currently under construction in the Nashville Yards development and under discussion at the West End Summit parcel).
Based on acreage the parcel for Lot E with all Apartments would bring in around $2.7m annually in taxes (condos drive higher property tax rates than apartments), with all Hotels would bring in around $2.35m annually in taxes, with all Offices would bring in around $2.0m annually in taxes.
Lot F (minus the land parceled out for the substation), has enough room to comfortably fit three residential buildings the quality of the SoBro Apartments or the apartment portion of the 505 Building with a boutique hotel similar to the Noelle or The Bobby on South 1st Street, along with a driveway entrance down the middle of the parcel with a cul de sac and green space/dog park. The estimated annual property tax collections of around $3.15m.
Lot E would be prime for two buildings, a hotel/residential tower and an office tower, similar to the block shared by The Doubletree Hotel and Bank of America Building in downtown. A one acre 20-story Class A office tower comps out to about $1.0m in annual property taxes while a highrise hotel on a 1.0-1.25 acre parcel is also providing comps in the $1.2m range. The estimated property tax collections of around $2.2m for Lot E land
Combined, the vision for Lots E & F provides comps that support an estimated annual property tax collection in the $5.35m range.
Appendix C: Riverside Property Comparisons
Using the Property Assessor’s website to compare the current assessments for land along the river to adjacent in-land commercial zoned land.
Downtown:
MDHA owned property on the East Bank along river is assessed at $1.415m & $1.742m per acre.
Nissan Stadium Parking Lot M is assessed at $1.415m per acre
Davidson St (between Korean Veterans Bridge and the Interstate bridge) parcels along the river are assessed at $131k per acre, parcels of land across the street (in-land) matched the $131k per acre assessment.
Commercial Land on River Hills Drive:
On the River is assessed at $140k per acre.
Adjacent in-land from the river is assessed at $140k per acre
Opry Mills Area:
Opry Mills Dock/Marina parcel is assessed at $370K per acre.
The Opry Mills Mall parel is assessed at $349k per acre, while the Grand Ole Opry land is assessed at $438k per acre and the Opryland Hotel parcels are assessed between $348k and $415k per acre.