Nashville Office Demand Highest in Nation

Nashville’s office market is not just keeping up with the times — it’s setting the pace.

As the city experiences a surge in tech sector growth, it led office net absorption in the United States and Canada, with a 2.3 percent increase between the third quarter of last year through the second quarter of this year, the Nashville Business Journal reported, citing CBRE’s annual Tech-30 report.

The city’s exceptional performance in office leasing is in stark contrast to the broader market trends. Nashville was one of only five cities among the top 30 tech hubs to see positive growth in office space occupancy. Vancouver, Baltimore, Raleigh-Durham and Montreal were the only other markets to share similar positive trends.

Nashville has become a key player in the tech world, experiencing a 5.1 percent increase in tech-related job growth from 2022 to 2023, second only to Toronto. This surge has contributed to more than 26 percent of the city’s office leasing activity so far this year.

The city’s success is no accident. Nashville has made strategic investments to become a magnet for technology companies. In 2019, the city of Nashville approved a $17.5 million deal for an Amazon hub that could create 5,000 jobs. Additionally, Oracle’s $1.2 billion investment in an East Bank campus solidifies Nashville’s position as a tech powerhouse.

These developments, combined with the city’s favorable business climate, have contributed to a rise in office rents. Nashville’s office rent growth surpassed 6 percent from the second quarter of last year to the same period this year. As a result, demand for office space, particularly in premium locations, has been robust.

Nashville’s growth is visible in projects like Southwest Value Partners’ Nashville Yards and New City Properties’ Neuhoff District. Global technology company L-Acoustics recently made plans for a headquarters at the 19-acre Nashville Yards development, which is expected to open soon.

— Andrew Terrell