BusinessTN

The Nashville Area Chamber of Commerce’s favorite pitch—that the area is located within 600 miles of half of the U.S. population—is coming through again. The Midstate has on its hands another burgeoning industrial hub, brought to you by the city of Lebanon and international warehousing and distribution companies.

What happened along the I-65 corridor during the late 1980s and 1990s (with the Bill Heard dealership and Averitt Express trucking hub) is happening again along the Wilson/Rutherford county line, where I-40 meets Highway 109 and State Route 840.

It all started in 1999 when Dell moved its Dimension desktop operation into Eastgate Business Park north of I-40, where it now employs some 1,400 people. The 694-acre development, which also houses Flextronics Logistics & Light Assembly with 1,000 employees, Nashville Auto Auction with 523 employees and National Fulfillment with 200 employees, is now near full capacity and out of land. Holly Sears of Wilson County’s Economic and Community Development board says there is only one 300,000-square-foot space left at Eastgate, and even that property, listed by Colliers Turley Martin Tucker, should go very soon.

Nashville-based Prime Properties, which developed Eastgate, has now built a 450,000-square-foot distribution center for German discount retailer ALDI. The nondescript $25 million big-box facility, which anchors the Nashville Regional Logistics Center, will have direct access to the 840 loop between I-40 and I-65, and will supply groceries to the chain’s entire Southeast operation.

Local commercial real estate brokers have branded the hottest new distribution submarket a “golden triangle,” and companies are catching on.

“If someone is looking for 400,000 square feet of Class A warehouse-distribution space in Nashville, it’s not available right now,” says Ron Coulter, partner with Atlanta-based Panattoni Development Co., Panattoni’s new Commerce Farms business park, located five minutes from Eastgate on Highway 109, is home to Bridgestone/Firestone’s largest logistics facility in the world. Currently 750,000 square feet and expandable to one million square feet, the center ships truck tires to all states east of the Rocky Mountains and automobile tires to 12 states. Bridgestone chose to close its Memphis, Dayton and Atlanta distribution centers to relocate to the Midstate after it saw Panattoni’s speculative building.

Coulter says developers must build speculative facilities because companies that arrive in town to shop for space and don’t find anything already built quickly move on to other markets. While this means greater risk in such projects, with the economy perking up, it’s proving to be a good bet that buildings will lease or sell well. They certainly do in Lebanon.

"That’s why we started another 456,000-square-foot spec at Commerce Farms,” Coulter says. “Some people are already kicking tires and doing homework before it’s completed in March.

Yet another star of burgeoning growth in the golden triangle appeared in December, when Michigan-based automotive glass maker Visteon Corp. decided to consolidate its Midwest operations in the Nashville area, signing a five-year lease on a 456,000-square-foot distribution center at Commerce Farms. Visteon already has a glass manufacturing plant in La Vergne, so it made sense to add a distribution facility next door.

Now, the state is planning to build another interchange on I-40 to accommodate the growth at Eastgate and Commerce Farms. The interchange will open 1,000 acres for development to the west of Eastgate.

Of course, big-box warehousing and distribution buildings rarely look alluring, even with modest geometric touches intended to breathe life into often dull, rectangular structures. But they sure do get the economic development job done and are loved by economic and community development officials. Pour a concrete slab as far as the eye can see, get the four walls up and cover it all with a roof. The rest will follow: employers move in; residential developers set out to build new cookie-cutter subdivisions; then the city scrambles to put together a new public school; and you have yourself a suburban sprawl. Next thing you know, artists and alternative rock bands move in, with urban designers in tow demanding hip, alluring architecture and historic revitalization. Now those are signs of economic recovery.