Dive Brief:
- After spending the last 10 months digging a massive hole on a site in the middle of downtown Nashville, sports and live entertainment giant AEG has stopped work on its portion of the 18-acre, $1 billion Nashville Yards mixed-use project, which is being spearheaded by lead developer Southwest Value Partners.
- AEG spokesman Michael Roth said in an email that the COVID-19 pandemic impacted the timing of the Los Angeles-based company's portion of the project, which was originally slated to include a music venue with capacity for 4,000 people, a nine-screen movie theater, 90,000 square feet of office space and a 315-room hotel and conference center.
- “AEG remains enthusiastic about the Nashville Yards project and the Nashville market,” said Roth, AEG's vice president of communications, but added the firm is pausing its portion of the project. “With the continued significant impacts of the COVID pandemic on our business and the economy more generally, we believe that the prospects for successful completion and opening of this exciting project will be best served by waiting until we are emerging from the COVID pandemic before proceeding with the next phase.”
Dive Insight:
The halt to AEG's entertainment-focused portion of the larger Nashville Yard project comes as many entertainment-oriented mixed-use developments have had to nix or scale down plans amid a historic struggle for movie theaters.
At the same time, the continuing impacts of the COVID-19 pandemic have wreaked havoc on both the office and hotel sectors, which have seen a slew of projects put on hold or had developers drag their feet on launching planned projects to wait for better timing.
The shutdown at AEG's portion of the larger Nashville Yards site further illustrates the inherent risk involved with billion-dollar, multi-year commercial construction projects in any market, and that a project's groundbreaking, while often celebrated, only marks the beginning of what is often a complex set of logistical and financial challenges.
In a bright spot for the larger Nashville Yards development and San Diego-based master developer Southwest Value Partners, however, Hyatt Hotels opened its Grand Hyatt Nashville property on the site earlier this month.
The 25-floor, 591-room luxury hotel is the first major completion of the larger Nashville Yards project, which is slated to include a total of 3.5 million square feet of office, 1,000 residential units, 400,000 square feet of retail and 1,100 hotel rooms. Amazon is one of the project’s highest-profile anchor tenants.
AEG, otherwise known as Anschutz Entertainment Group, owns the Staples Center in Los Angeles, as well as several other arenas around the world. While the firm didn’t commit to a precise timeline on when it would continue its portion of Nashville Yards, or how it would secure the the massive excavation site in the middle of America’s 24th largest city while the project is dark, it did set its eyes on next year for a continuation of work.
“We do not have a definitive timetable yet," said Roth, "but expect that conditions will allow for a start of vertical construction sometime in 2021.”
