Located at the gateway to the West End corridor, Nashville has a new water feature called Lake Palmer. Lake Palmer is not exactly a lake, but is actually the unintentional result of stalled construction from Alex Palmer’s West End Summit mixed-use project. The more than 80 foot deep construction hole appears to be at least 70% full of water at this time, making it about 56 feet deep. I know we are joking about it, but at 56 foot deep, this unofficial body of water would be deeper than most of Percy Priest Lake and Old Hickory Lake. Concerned citizens have complained that the site is a public health and safety hazard, but it remains to be seen what the City of Nashville may require Palmer to do in addition to the current fencing and concrete barriers.
The West End Summit has planned twin 25-story towers, 900,000 total square-foot complex that will house 500,000 square of Class A office space, high-end retail space, 1800-space enclosed parking garage, the InterContinental Hotel and 47 ultra luxury condominium units. It is reported that the 281 room InterContinental Hotel will span floors 1-18 and the luxury condos will rise above the hotel on floors 19-25 in the tower closest the central business district. Initially, the project was slated to be a 1.6 million square foot mixed use site, but was scaled back in 2007 to just over 900,000 square feet. Similarly, the initial construction cost estimates were scaled back from almost $300 million to just over $200 million. Ironically, or maybe not, these construction cost estimates, timelines, and scale backs are very similar to those of Tony Giarratana’s Signature Tower upcoming project in downtown Nashville.
The project had initially been projected to be complete in 2010, but there is no new information on a construction, let alone, completion timeline. It is also rumored that permanent construction financing cannot be attained until more than 60% of the office space is lease on a 10 year lease at $28/ft. Currently, the deed of trust on the property shows Alex Palmer owes Wachovia $21.5 million with no plans to proceed with going vertical.
Condos in the West End Summit
“The Summit Residences, positioned directly above the hotel, have been designed to create the most luxurious condominium experience in the Nashville market. Residents enjoy all the benefits of the hotel amenities while experiencing superior views of Nashville’s beautiful skyline. A private entrance and a dedicated concierge help to maintain the exclusivity one would expect for a development of this caliber.” Owners would have 24 hour access to a 10,000 square foot state-of-the art health club and resort spa, room service from both InterContinental Hotel restaurants, maid service, turn down service and butler concierge.
The condos range in size from 1,100 to 2,100 square feet, were priced at an eye popping $750/foot and ranged in price from $850,000 to $1,533,000. Several condos were originally listed on May 14th, 2007 by Worth Properties, but were all withdrawn from the market 762 days later. It is reported that Worth was only able to place 3 condos under contract during this 25 month period.
Hotel partner in the West End Summit
“The Intercontinental Hotel brings a new level of class and amenities to the Nashville lodging market. Elegantly appointed guest rooms with pillow top bedding, floor to ceiling windows and marble baths, create an inviting space for visitors. Guests also enjoy access to a first class resort spa, fitness center and pool conveniently located in the hotel.” It is unclear as to whether or not the UK based hotelier is still committed to the project at this time.
Office building portion of the West End Summit
“The office tower is ideal for companies looking to create the perfect work/life environment for their employees and to convey the highest level of professionalism to those that visit their space. The office entrance sets a professional tone with a first class lobby experience complete with marble floor, exotic wood and glass finishes. The typical 24,000-square-foot floor plates allow for efficient utilization of work space.” However, local commercial real estate agent Todd McCalla points out that the project’s $28/ft asking price is, “clearly much higher than Nashville’s average rate of $22/ft for Class A office space in this district.” McCalla is also quick to point out that West End currently offers over 2.4 million feet of Class A office space and currently maintains a 19% vacancy rate. He is skeptical about this market’s demand for such high-end space during a period when companies appear to be eliminating their excess office space needs.
Retail space in the West End Summit
Little is known about what retail tenants may have been interested in leasing space, but the development’s website says, “The project is slated to include several signature restaurants, including a World renowned Steakhouse and high-end retail opportunities.” Downtown Nashville is certainly lacking high-end retail space, but the 1600 West End location may not be the most intuitive place to fill this need.
Developer Alex Palmer and Company Sued by Contractor
On November 4th, 2008 the Nashville Post reports: “An engineering contractor has sued the entity behind the planned $200 million West End Summit and its general contractor for nonpayment. Minnesota-based Harmon Inc. has claimed in Davidson County Chancery Court that West End Summit Development LLC, which is being developed by Alex Palmer, and Bovis Lend Lease have failed to pay $120,000 for services performed on what is now a big hole in the ground along West End Avenue.