Dive Brief:
- The Memphis, Tennessee, region saw $1.3 billion of new commercial construction permits issued in 2018, according to a WHBQ-TV Fox 13 analysis of data from the Memphis and Shelby County Division of Planning and Development.
- The 1,363 permits that Fox 13 examined represented projects in several sectors including multifamily, office, hotel and mixed use.
- Memphis is still playing catch up with Nashville, however, which has 18 projects valued at $100 million or more, with two of those worth $1 billion.
Dive Insight:
Commercial real estate and research companies Cushman & Wakefield and Commercial Advisors track development projects in the Memphis area and projected that there are currently more than $14 billion of developments completed, under construction or proposed since 2014. The vast majority of that figure are projects under construction ($6 billion) or in development ($8 billion).
The value of downtown construction projects alone, under construction or in planning, according to the Memphis Business Journal, was $4 billion at the end of December. Like in metros all around the U.S., Memphis’ baby boomers and millennials want to live, work and play in an exciting urban environment, so employers, businesses and services are moving into the area to tap into a ready population of new city dwellers.
One of the most notable projects in the development pipeline is Big Rivers’ proposal for a $950 million downtown mixed-use project, the biggest one the city has ever seen. Union Row would take over almost 30 acres of blighted property and turn it into the kind of walkable community so many Memphis residents reportedly want. The project would be built in three phases and, in total, would feature almost 1,500 new residences, 380 hotel rooms, at least 2,600 new parking spaces, almost 350,000 square feet of office space, 65,000 square feet of retail and a 30,000-square-foot grocery store.
The first phase alone is expected to generate 3,700 construction jobs, which will provide new opportunities for area contractors and their employees but will no doubt add additional stress to the state’s labor pool, given the amount of activity in Nashville and the other projects planned and underway in Memphis.
FedEx also plans to invest more money into its hub at Memphis International Airport, a reported $1 billion to upgrade and increase the size of its facilities there. The shipping giant plans to build a new sorting facility and make other improvements that will help its Memphis hub process packages, an operation which handles almost 50% of the company’s daily volume.
