Where Vanderbilt goes, will others surely follow?
In this case, Berry Hill — perhaps the most quirky and beloved of Davidson County’s satellite cities — is bracing for what could be new buildings, new businesses and new ways to help pedestrians and motorists move from Point A to B to Z.
Even before Vanderbilt University Medical Center officials announced plans to use 440,000 square feet of office and clinic space at 100 Oaks Mall, people interested in office space, retail space and development were exploring Berry Hill.
“We had calls and requests for information about developing along Thompson Lane and in the area beyond Heather (the street that runs parallel to Thompson and in front of the entrance to Sam & Zoe’s),” said Joe Baker, city manager for the City of Berry Hill.
Since the announcement, additional calls have followed.
“We expect some development to happen over the next handful of years,” Baker said.
Developer Bill Hostettler, who has undertaken seven developments in or near Berry Hill, said a lack of available land might limit new construction and create the need for the reuse of existing structures. For example, Hostettler’s Craighead Development bought an existing 1960s-era apartment complex located on Inverness Avenue (straddling the western fringe of Berry Hill) and converted its units to condominiums.
“We did this conversion based on the knowledge of Vanderbilt coming to the area,” said Hostettler, noting Village South’s 76 units will range from $119,900 to $134,900.
With VUMC to infuse the mall property (which sits across Thompson Lane from Berry Hill) with workers and visitors to its Vanderbilt Health at One Hundred Oaks facility, change looms, added Hostettler, whose Craighead Development headquarters building sits in the satellite city.
VUMC’s lease is the equivalent of about $65 million and includes $36 million VUMC expects to spend for renovations and build-out. Also, mall owners Tony Ruggeri and Frank Mihalopoulos (partners in 100 Oaks Plaza LLC and Dallas-based M & R Investors LLC) plan to significantly update the property. A pedestrian bridge connecting the mall to Berry Hill is also on tap.
Since rumblings of Vanderbilt’s arrival, Hostettler said sales prices for Berry Hill’s smallish homes north of Thompson and east of Bransford Avenue (almost all of which house retail or service businesses) have skyrocketed.
“If a property goes on the market, it will be gone in a day or two,” Hostettler said. “The prices have gone from about $225,000 for one of the little houses to about $325,000 in the last year.”
Troy Smith (the owner of Baja Burrito, the building from which it operates and four other Berry Hill structures) said the VUMC move should create more positives than negatives.
“My initial concern was that it would bring so much development that the area would lose some of its eclectic and funky character,” Smith said. “The ideal would be that all the businesses get a nice shot in the arm without losing the charm.”
Smith said many of the business proprietors also own the properties from which they operate and, because of their loyalty to the district, might be less likely to sell to a developer who would demolish and build anew.
Kathy Corley, a veteran Berry Hill merchant who has operated her Curious Heart Emporium for nine years, said many of the district’s business owners are “excited.”
“We’re hopeful but concerned about what it will do to the face of Berry Hill,” Corley said. “Will the houses be demolished and replaced by office buildings? I’d hate to see that happen.”
In time, shifts in Nashville real estate value will dictate the future of the area. Until then, real estate in the district will remain highly desirable and rarely available, according to Margaret Ann Hostettler, the long-time owner of Hostettler Realty and mother of Bill Hostettler.
“These properties go quickly when they are put on the market,” said the elder Hostettler, who has handled Berry Hill property transactions for almost 40 years. “I need listings right now.”
VUMC’s initial lease is for 12 years, with five renewal periods of 10 years each. Vanderbilt will have the right of first refusal to purchase the entire mall if Mihalopoulos and Ruggeri decide to sell, and have options to lease additional space if existing tenants leave.
VUMC projects a July 2008 occupancy. The Nashville office of Gresham Smith & Partners is handling much of the mall’s redesign work.