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VOL. 38 | NO. 20 | Friday, May 16, 2014

One million new residents headed to Middle Tennessee: Where will they live? Will we be ready?

By Jeannie Naujeck

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For Middle Tennessee, the question is not, “If we build it, will they come?” It’s more like, “How will we build it before they come?” During the next 20 years, Middle Tennessee’s 10-county region will absorb 1 million new residents. That’s twice the growth rate of the rest of the nation.

But it’s not just the sheer number of new residents that will reshape the landscape of cities, towns and countryside. Middle Tennessee’s new neighbors will be a more diverse demographic mix than the region has ever seen, bringing different needs, desires and expectations for housing, work, entertainment and transportation.

Young people, seniors, singles and childless households will form a much bigger share of the market, creating more demand for smaller housing units and rentals.

They’ll also demand more convenience and access to services, and expect a range of transit options not currently available.

Nashville-Davidson County, currently the nation’s seventh fastest-growing city, will get about 200,000 new residents, and is pursuing high-density development and infill downtown, along its pikes and in close-in suburbs.

Williamson and Rutherford counties will each grow to half a million residents from their current populations of 193,000 and 275,000, respectively.

Williamson, eager to preserve its historic districts and open spaces, is incentivizing planned, mixed-use communities, while Rutherford is more development-oriented.

“If I had to choose one term, it would be, ‘long-range planning,’” Franklin Mayor Ken Moore says. “We know we’re going to be the center of a lot of the growth that’s going to occur in the region over the next 25 years.

“We’re doing long-range planning whether we’re talking about transportation, stormwater, sewer, drinking water, strategic planning – every facet of the city.

Moore

“The biggest challenge as we grow is that we continue to keep the charm we have and continue to be a destination where people want to live, work and raise their children.”

Stalling sprawl

On the far ends of the region, Maury and Montgomery counties will both continue on their current growth trajectories, with Spring Hill attracting young people priced out of Franklin, and Clarksville absorbing large numbers of veterans seeking a tax-friendly place to retire.

And Wilson County is readying the region’s first transit-oriented development, a community called Hamilton Springs, with residences, businesses and the seventh Music City Star station near Lebanon, a city that has grown by a third since 1990.

All around the region, county mayors and town planners are forming development strategies to accommodate their share of the growth.

But there is a growing consensus that communities will need to shift from old land-use policies to principles of smart growth that include higher-density development, connectivity and the development of mass transit – or continue a legacy of sprawl, highway congestion and higher taxes to pay for infrastructure.

“Part of what’s really unique about the Middle Tennessee region is that you have wonderful places like Franklin and Lebanon and Gallatin and Murfreesboro and Dickson that have their own identity but are part of the economic strength of the region,” says Rick Bernhardt, executive director of the Metropolitan Planning Department and a respected figure in national urban planning circles.

“For those counties to figure out how to handle the growth they’re going to get but to maintain their character is going to be just as important for Nashville-Davidson County as it is for them.

“So if we’re going to preserve the character and distinctiveness, we have to plan now.”

Not Atlanta

Middle Tennessee has stood on the cusp of major growth before.

In 1999, the regional leaders convened a summit to discuss planning for future growth and development, and ways to tackle the growing problem of sprawl.

The region had seen its population grow by about a quarter million new residents throughout the 1990s – a 22 percent increase. One acre of former farmland and natural area had been developed for every 1.41 of those new residents.

Per-capita driving had increased over the decade from an average 30 miles per person per day to 37.5 miles.

And the region was expected to add a half-million new residents over the next 20 years.

Jones

“We were on the same path as Atlanta because of the land use stuff – designing and codes from the early 70s for sprawl, highways, low-density development,” says Bridget Jones, executive director of Cumberland Region Tomorrow, an organization that grew out of the summit. It facilitates regional visioning and disseminates strategies and best practices on “smart” or “quality” growth and development.

“We wanted to grow, we wanted jobs and opportunity, but how do we do it? We felt we could handle it differently.”

The focus of discussion at the summit was the Peirce Report, a series of researched articles commissioned from The Citistates Group that served as a wake-up call on Middle Tennessee’s low-density land use policies and contained recommendations for taming sprawl.

Sprawl occurs when housing is clustered together and set apart from other community functions such as shopping and offices, meaning roadways are needed to get from one place to the other.

This type of land use was encouraged by post-World War II federal housing programs that lowered mortgages to less than the cost of rent to encourage homeownership and by extensive interstate highway building.

Legacy of ’80s boom

In Middle Tennessee, the establishment of the auto industry exacerbated sprawl.

The openings of auto plants by Nissan in Smyrna and GM in Spring Hill, along with numerous auto suppliers in the 1980s, triggered a boom in homebuilding to accommodate all the new and transplanted hires.

The problem was that land use codes at the time dictated low-density residential building, resulting in vast swaths of land eaten up by subdivisions of houses on large lots.

“In both cases, the builders built what the planning and zoning called for, which was one acre lots, so you just started getting sprawl,” recalls Jones, who lived in Columbia at the time.

“That was the 80s, and by the late 90s the problems were beginning to present themselves with congestion and people having to drive too far.”

The Peirce Report advocated establishing regional transit along existing rail lines and the adoption of Traditional Neighborhood Developments (TNDs) that were becoming common around the country, the most famous example being Celebration, Florida, a master planned community developed by The Walt Disney Company.

The 23-story Twelve Twelve condos in The Gulch will feature 286 units at an average of $580 per square foot. The most expensive units have been sold.

-- Lyle Graves | Nashville Ledger

So-called “New Urbanist” communities recreate the atmosphere and amenities of a traditional small town or urban neighborhood, with retail, commercial and office space located generally within a five-minute walk of residences.

“Where New Urbanism has set in, the result is communities that are not just well-tended but rich in architectural variety, with shops of all sorts, civic spaces, interesting mixes of people,” the Peirce Report said.

“People point almost instantly to these places as the soul of their region and the models for the future.”

New Urbanism sells

Local examples of New Urbanism, including Lenox Village, Westhaven and The Gulch, are some of the market’s hottest-selling properties today.

But in 1999 the prevailing philosophy was to place few restraints on the development of large land tracts.

“By the early 90s (New Urbanism) was mainstream in the design community and among planners,” says Hunter Gee, founding partner of Gee Smith Studio, which oversaw the Gulch Redevelopment Master Plan.

“And yet we were still in a world of old land use, zoning, separate uses, spread it out policies that infiltrated all our public agencies.”

Today, Atlanta ranks first in the nation for sprawl among large metropolitan areas with population of over one million, according to Smart Growth America’s Measuring Sprawl 2014 report.

In second place: Nashville.

A change in philosophy

But the Peirce report heralded a new era of prioritizing community character and livability while encouraging economic development.

Cumberland Region Tomorrow began as a direct outgrowth of the summit and The Land Trust for Tennessee and the modern-day Nashville Civic Design Center also launched around this time. Bill Purcell was elected mayor of Nashville in 1999 and immediately created an Office of Neighborhoods.

In addition, the hiring of Bernhardt as Nashville’s planning chief in 2000 signaled a major turning point in the city’s development.

Bernhardt, a Nashville native and New Urbanism proponent who had spent 17 years as the planning and development director for Orlando, began setting policies to transform downtown and surrounding neighborhoods like The Gulch, Germantown and Rolling Mill Hill into residential and commercial districts that are safe to live in, have inviting streetscapes, are easy to access by foot, bike, bus or car, and provide a range of services, amenities and entertainment that do not shut down when the workday ends.

Under Bernhardt, a form-based code was applied to downtown in 2010. Form-based codes dictate how a building should look on the outside to fit into the urban landscape but do not place restrictions on what the building is used for, as traditional use-based codes do.

The code is rapidly becoming the standard in cities and towns that want to revitalize their downtown core because it encourages the development of mixed-use buildings that can contain residences, shops, offices, restaurants, gyms and grocery stores, and eliminates the need to apply for variances.

Bernhardt also notes that property values tend to rise significantly wherever a form-based code is applied, including within the city’s Urban Design Overlay districts.

Hot spots: Downtown, Gulch

The implementation of the form-based code stimulated a surge of mixed-used development, with the number of downtown building permits more than tripling, as well as a renewal of interest in living downtown.

Indeed, the downtown and Gulch markets are the hottest areas for real estate right now. Nashville condos are currently selling for top dollar “as long as they’re downtown and new,” says Richard Courtney, veteran Realtor and Ledger columnist.

“It needs to be in a high-rise and in a cool place, with walkability.”

While downtown and Gulch condo sales lost some momentum during the recession, they started bouncing back in 2010 and 2011 when a flood of buyers took money out of Wall Street and poured it in Nashville real estate, Courtney explains.

“The first phase was demand for downtown living and the second was that we so much cash flowing into the city that we’d never seen before,” he says.

“The infusion of cash is what really pulled the high-rise condo market out of the doldrums of the recession.”

4000 Hillsboro would feature commercial, retail and restaurant space, as well as 301 residential units, across the street from The Mall at Green Hills.

-- Submitted

Now, Nashville can’t build condominiums fast enough. The newest high-rise in the Gulch, the 23 story Twelve Twelve building, is being sold as luxury condos after being financed as apartments. The building will have 286 units, and all penthouses are sold out, with units going for $580 per square foot. The project is on track to open by late summer.

What’s trending and why

The move back to cities is a national trend led by two groups: seniors downsizing from large homes, and Generation Y and Millennials, who are looking for convenience, amenities and walkability.

“This generation appreciates diversity and wants to be social and interactive and close to the action and have options to get around. They don’t want to spend money on things they don’t need, like cars and big apartments or big houses,” says Gee, who oversaw The Gulch Redevelopment Master Plan.

“Those are the values that have been clearly defined for this generation. It’s the first time values have shifted to that degree since World War II, really, and those values are going to carry through as they get older.”

Increasingly, people are choosing to live in a city based on its amenities – even if they have no prior connection to the area.

“That’s the weird thing,” Courtney says. “In 35 years of selling real estate, for the first 31 years, when people moved here they had a reason; they knew someone and could get a job. Now people are moving here and they say, ‘I’ll find something when I get there.’ That’s the strangest thing I’ve seen.”

It may be strange but it’s one of the defining features of Generation Y and the Millennials, says Chris Zimmerman, vice president for economic development at Smart Growth America.

“They are a generation that is more and more choosing where they want to live before they decide who they’re going to work for.

Uptown Flats might seem a little out of place alongside Dickerson Road’s auto repair businesses and mobile home parks, but more such developements are expected to follow.

-- Lyle Graves | Nashville Ledger

“They say, ‘I want to live in this place’ and then look for a job whereas earlier generations would say, ‘We’ll move to where the job is and then we’ll go find a place to live.’ So employers who want these folks are moving more and more to places those people want to be.”

And because younger generations value flexibility and the option to move where jobs are, more rental stock will be needed. In Davidson County, 75 percent of all the housing to be built will need to be rental to meet demand.

“It’s a different mindset than what we have thought historically,” Bernhardt adds.

What’s next for Nashville

Nashville-Davidson County is midway through a three-year program called NashvilleNext that will craft a plan for Metro Nashville’s growth and development based on the community’s values and priorities.

Public input is a big part of the process, and to date, more than 10,000 citizens have participated in exercises that included “visioning” the county’s future and mapping areas for potential development as well as preservation.

Local experts are using that input to create growth scenarios that will be presented in June. The public will be invited to make choices on policy decisions through a series of town halls, community meetings and “lounges” held over the summer; a final plan will then be drafted.

The future growth scenarios include focusing development downtown and along the pikes radiating out from it, as well as developing strategic urban centers with supportive infill and transit in the city’s close-in suburbs, including Donelson, Madison, West Meade, Bellevue, Antioch and Green Hills, creating “complete communities” that meet all their residents’ needs and are connected by mass transit.

They would also allow the preservation of each community’s historic character.

“Part of the character of Middle Tennessee is having those areas that are close in with a large lot,” Bernardt says. “So what it means is a strategic finding of locations where you can have more intensity but preserve the character.”

Fifth and Main combines residential, commercial and restaurant space in East Nashville. It is less than a mile from Five Points to the east and downtown Nashville to the west.

-- Lyle Graves | Nashville Ledger

More than a dozen possible suburban infill sites have been selected around Davidson County, and students from the University of Tennessee College of Architecture and Design have completed urban design master plans for each one.

They are also exploring more transit-oriented development along Ellington Parkway, at the Trinity Lane exit and the Spring Street terminus, on land owned largely by Metro and state government.

“The demographics are changing with aging boomers and Millennials looking for locations that are close to where they want to be so the demand itself is changing. We’re already seeing that on the pikes and the first and second ring suburbs with infill development,” Bernhardt says.

“The issue comes down to one that’s more subtle: how do you accommodate density and maintain at least the basic character? And that’s where these scenarios are going to come into play more.

“You have choices along the pikes where you can provide transit,’’ he adds. “You’re going to have strategic locations whether they’re in the centers or strategic locations where redevelopment may happen inside the neighborhood.

“It’s just not going to be carte blanche and I think identifying where the locations are is going to be extremely important.”

Infill in Green Hills

One example of the type of infill that can add intensity is the 16 story mixed-use development currently being planned at 4000 Hillsboro Pike in Green Hills.

Developer Southern Land plans for restaurants, retail, office space and about 300 residences to occupy the 85,000 square foot complex, which is described as an “urban village.”

Enabled by an Urban Design Overlay, the project is currently the subject of a lawsuit by the Green Hills Neighborhood Association, which says it will make an already congested area worse.

Others maintain the project will take people off the roads, because they will be able to walk to shopping instead of having to get in their cars.

“Nobody opposed expanding Green Hills Mall, which is the principal reason for congestion,” says Gary Gaston, design director of the Nashville Civic Design Center.

“I think it will be hugely successful and a game-changer. It will show people what the reality is, have a positive impact and generate support for future projects.”

Pikes hold promise

Nashville’s many pikes – Gallatin, Charlotte, Nolensville, Franklin, Hillsboro, Dickerson – also hold great potential.

While many of them are dilapidated commercial corridors, they could accommodate all of Nashville’s future housing needs just by redeveloping them with low to mid-rise mixed-use buildings containing housing, commercial and office space, says Arthur C. Nelson, author of a detailed study called Greater Nashville Trends, Preferences and Opportunities 2010 to 2025 and to 2040.

The pikes contain large sites that are already flat and well-drained, have infrastructure in place and have four- or six-lane roadways that can be retrofitted for mass transit and renovated with pedestrian-friendly walkways and intersections.

Low- to mid-rise buildings fronting the road could be backed by townhomes that transition gently into the single-family neighborhoods that begin about a quarter to a half-mile behind the pikes.

Franklin has already completed a redevelopment of its Columbia Avenue gateway corridor.

The project created an attractive new business district that has brought investment to a once-neglected arterial, and connects downtown and historic neighborhoods for pedestrians, bikers, drivers and transit riders.

The city is now at work on a Hillsboro Road streetscape project.

“The real value is investing in the core of your city and we believe in that, and we’ve invested heavily in our core,” Franklin’s Mayor Moore explains. “We believe if we can take care of the infrastructure issues, then beautify the area, it’s going to create a stimulus for economic development.”

Nashville has begun experimenting with the pike redevelopment concept for affordable housing.

Last year saw the opening of Uptown Flats, a three-story, 72 unit “green-built” apartment building on Dickerson Road funded by a federal grant through the Neighborhood Stabilization Program. Rent for one, two or three bedrooms starts at $659.

The attractive contemporary design looks out of place on Dickerson Road now, but it’s easy to imagine a new spurt of commercial development revitalizing a strip that lies so close to downtown.

Another example of a pioneer housing development is Fifth and Main, a mix of condos, townhouses, retail/restaurant and office at the gateway to East Nashville.

Built in 2008, it faltered during the recession but has come back in a big way. All its residential and commercial units have been sold, just as the Main Street/Gallatin Road corridor is developing with upscale businesses to match East Nashville’s soaring home values.

“My advice to you is the redevelopment of existing commercial corridors,” Nelson told an audience at the Civic Design Center’s annual meeting last fall.

“In Davidson County and the closer-in parts of the suburban counties, all the new demand for non-residential space and all the new demand for rentals, townhouses, condos, all of that, could be accommodated on existing commercial boulevards, with the right mix of land uses.”

Millions on the move

As with all growth scenarios, transit remains an essential piece of the puzzle. Moving a million new residents around the region will be impossible without mass transit – something that does not yet exist despite years of work by transit agencies, modeling of cities like Denver with similar issues, growing highway congestion, rising gas prices, and a rising expectation for alternate transportation.

“It’s startlingly surprising to people moving here that we don’t have mass transit (other than buses). They just assume we do,” Realtor Courtney says.

Mayor Karl Dean has called Nashville “about a decade behind” peer cities like Charlotte and Austin.

“People are willing to move here even though we don’t have transit because they see that we’re thinking about it and we’re trying, but if you can’t show them that and it’s not going to happen, you’re going to lose out on that in the future,” Gaston adds.

Still, he is optimistic that regional leadership will coalesce around the issue. He points to the collaboration that is already taking place around smart growth.

“Where we are right now is a result of 50 years of building to this point – suburbanization and driving to communities.

“It would be great to have lots of mass transit lines already in effect but the fact that we’ve gotten to where we are now, with the cooperation we’re experiencing in the region, the conversations we’re having are really good,” Gaston adds.

“The planning is taking place and the next 20 years are so critical, with these million people coming in. This is a pivotal moment where we can either continue to move in a really positive direction – or we fall off the map, and you can pinpoint that moment in time where we should have made those decisions but we didn’t.”

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