Writer: Joshua Andino
3 min read December 2022— In Nashville, businesses have been growing. But as 2023 approaches, can the rest of the city keep up?
Nashville, and the wider Middle Tennessee region it anchors, has emerged over the last two years as an economic powerhouse. While the area was already a national cluster for healthcare research and innovation, hosting over 500 companies within the sector, its swelling population and the successes the state has scored over the last two years have placed Music City on a variety of industry shortlists for further expansion or potential relocation.
Examples are easy to come by. The city and the Tennessee Titans agreed to terms for a new $2.1 billion stadium on the rapidly growing East Bank — further cementing Nashville as a sports tourism destination. Software giant Oracle announced it’d be coming to Nashville in April, bringing $1.2 billion in investments and generating 8,500 jobs. Ford chose Tennessee as the host of BlueOval City, the largest and most advanced auto plant in the company’s history. General Motors is pouring over $2.3 billion into an EV battery plant of its own 30 miles south of Nashville. Most recently, Gov. Bill Lee and LG Chem announced a $3.2 billion cathode manufacturing facility in Clarksville, the largest foreign-direct investment in Tennessee history. Dozens of other announcements have been made over the course of the last two years, and while each on their own would have a significant impact on the region, altogether, they are transformative.
Resultantly, 2023 will be marked by Nashville building out and up to meet the demand of thousands of new residents and workers that will be coming to call the region home as offices, plants and other facilities come online. While nationally there are concerns over a potential recession, Nashville seems well-insulated from a potential economic slowdown. Local businesses both big and small remain bullish on the future, with Greg Coleman, Principal and Managing Broker of Southeast Venture telling Invest:, “Pretty much every area of Nashville is going up. I would say there’s growth in every direction in Nashville… Going into next year, I see everybody being as busy as they are today.”
Housing and transportation will be critical to the success of Nashville and across Middle Tennessee. The region’s new high-paying jobs and swelling population has driven housing affordability and traffic into sharp focus. The Housing Fund’s 2022 Impact Report notes the organization, dedicated to providing access and housing assistance to low- and middle-income earners, provided over $3.6 million in down payment assistance loans to individuals, leveraging over $66 million in first mortgage lending.
Marshall Crawford, president and CEO of THF, told Invest: that a market cooldown would do little to help those most at risk. “As interest rates increase, the demand for housing will slow in some markets, but the supply of affordable housing units will continue to be impacted and undoubtedly, affect low- and middle-income individuals. The people we serve are usually cost burdened before the topic of homeownership is even broached.”
While the Nashville housing market seems to be in the midst of a correction as transactions slow, the sheer imbalance of supply and demand means that prices remain stable — and out of reach — even as inventory continues to increase, reports Norada Real Estate.
As Nashville continues its evolution as a major international business hub, it will be forced to grapple with its lack of effective public transportation. This year will mark the first full year the city had a Department of Transportation to call its own, with NDOT formed in mid-2021. Last month, NDOT released its Downtown Mobility report, highlighting both key needs and potential solutions to traffic issues that have since been exacerbated by the city’s rapid growth. The city has also looked at some innovative ideas — such as using autonomous vehicles interspersed within traffic to help influence driver behavior and avoid the stop-and-go traffic that forces Americans to spend 239 hours each year on average commuting to their destination.
Highlighting the ongoing efforts to address these concerns in Nashville and across the state, Tennessee Chamber of Commerce & Industry President & CEO Bradley Jackson said, “It’s really the available talent, transportation and infrastructure. Continuing to invest in those areas will help us to keep moving forward,” in his interview with Invest:
With the region and Nashville proper expected to continue to grow, city leadership will be key in the decisions to be made for the future. Mayor John Cooper, who affiliates himself as a Democrat despite the nonpartisan nature of the race, has yet to announce his re-election bid for 2023. The Mayor has continued to fundraise, even as city council members and economic planners – District 19 Council Member Freddie O’Connell, former Nashville Economic Development Director and Chief Strategy Officer Matt Wiltshire and now at-large Metro Council Member Sharon Hurt — have announced their candidacies over the last few months.
With so much underway across Nashville, local officials, state policymakers and private businesses all find themselves in one of the hottest markets in the country. As businesses continue to plant their flags across the region, the question to answer as Middle Tennessee heads into the next year is simply a matter of whether the rest of its economy can keep up with a demand that remains robust and resilient even in the face of potential national headwinds.
For more information, visit:
