Demand Outpaces Supply of Downtown Housing

Nashville Downtown Partnership
August 16, 2005

Demand for housing opportunities in downtown Nashville is outpacing the supply of condominiums and apartments that are either planned or being developed, according to July's Nashville Downtown Partnership Residential Report.

Even when all existing projects are counted, Greater Downtown will still be able to absorb an additional 1,792 apartments and condominiums by 2010.  There currently are 1,517 residential units in the downtown area. The occupancy rate for existing units has been 95 percent for the past three years. Another 1.740 units are either planned, taking reservations or under construction.

Church Street is emerging as a major downtown residential corridor.  With three existing properties and two under development, at least 738 residences will have a Church Street address by the end of 2006.

"Success brings success," said Nashville Downtown Partnership Executive Director Tom Turner. "Nashville's vibrant economy is attracting more and more downtown commercial developments whose employees want more opportunities for living and having fun near where they work." Turner added, "Another important driver for the downtown residential market is the diversity of current offerings-from very affordable to very high end. As with any neighborhood, we need to make sure that those who want to live downtown can find something that fits their needs and economic circumstance."

Encouraging a healthy mix of available rental and ownership opportunities is also important. Many downtown residents want to make their own home, while others prefer to rent. Existing residential conversions and new developments will result in 51 percent of downtown units being for purchase and 49 percent rental, while at the beginning of 2004, only 17 percent of Greater Downtown's existing residential units were for purchase and 83 percent were rental.

A survey of downtown residents conducted in June by the Nashville Downtown Partnership found that 61 percent of them also work downtown.  Being close to work is their No. 1 reason for choosing to live downtown.  Downtown residents are successful and well-educated.  Of those who responded to the Nashville Downtown Partnership's survey, 30 percent earn between $40,000 and $50,000 a year and 11 percent earn more than $150,000. At least 59 percent have a college education and 24 percent have post-graduate training. Most downtown residents-62 percent-are single, and 57 percent are between the ages of 25 and 44.

The Nashville Downtown Partnership is a non-profit private sector management group whose core purpose is "to make downtown Nashville the compelling urban center in the Southeast in which to LIVE, WORK, PLAY, and INVEST."  With its focus on business recruitment and retention, residential development, public space management and access and transportation, the Partnership addresses the needs and expectations of all downtown investors and stakeholders.