When it came to commercial construction activity in Nashville, Tenn., during the shelter-in-place months, GBT Realty Corp. took a distinct approach. The company teamed up with Koch Real Estate Investments to break ground on ONE22ONE—a 24-story office project at 1221 Broadway—after landing a $141.1 million loan via Mack Real Estate Credit Strategies in April.
The 365,000-square-foot project has been making headlines for being the first new office building in Nashville to incorporate virus-mitigation features, as well as for two important announcements: FirstBank will be the project’s anchor tenant, with plans to expand, and its parent company is also preparing to relocate its headquarters into the building.
What is ONE22ONE all about? Managing Director Jeff Pape is very optimistic about the impact the development will have on the metro’s office market when it delivers in 2022.
ONE22ONE may seem like a daring move during these challenging times for the office market. What makes you confident about this development?
Pape: While it may seem that we are amid challenging times for the office sector, GBT remains confident in this sector, particularly for an office tower such as ONE22ONE. The building is located on a site that offers the best access, views and amenities in a high-growth market such as Nashville, providing quick connectivity to the center of downtown, out of downtown and onto interstates 40 and 65. On top of that, we believe the corporate office workspace will continue to play an imperative role in successful business operations. Direct collaboration and personal connectivity with peers cannot be replicated in an online environment.
What is ONE22ONE’s development timeline for the rest of the year?
Pape: Groundbreaking was completed and construction is underway. We expect to be coming out of the ground in the next few weeks.
The building will incorporate a number of health-related elements to ensure protection against viruses and other health concerns. What are three of your favorite features?
Pape: The HVAC system is designed to allow each office floor to operate independently of other floors, eliminating the sharing of air supply or return air between floors or tenants. This aids in stopping viruses from spreading throughout the building.
This iconic office tower offers a near touchless experience—everything from elevator dispatch to hands-free faucets, motion light sensors, a mobile parking app, and more. This means that employees will rarely have to touch anything beyond their own supplies and equipment.
Our emergency response plan includes thermal scanning in the building lobby to identify any individuals with excessive temperatures entering the building, upgraded HVAC filters and enhanced cleaning protocols.
What challenges do you expect when implementing these key features?
Pape: We expect to implement these new design best practices very easily and with minimal costs. The COVID-19 pandemic began before ONE22ONE’s construction and final design plans, allowing us to pivot and enhance various aspects relatively quickly. For existing buildings or buildings further along in construction, a number of these features will be much more challenging and expensive to implement.
Tell us about the certifications you are aiming to qualify for with this project.
Pape: Due to the sophisticated design and the elevated standards of health and wellness mentioned above, ONE22ONE certainly has the potential to pursue a WELL v2 designation—the next version of the pioneering WELL Building Standard. Final determination of the pursuit of the certification will be determined once we are further along in the development process.
How did the financing process unfold under the current circumstances?
Pape: There remains a deep belief and determination in Nashville moving forward. This market will continue to be very attractive for corporate relocations, and even employee relocations, as more companies are opening the door for remote work. Mack Real Estate Credit Strategies and Koch Real Estate Investments are funding our projects, which speaks to their belief in Nashville and in ONE22ONE in the long term, as well. Closing on construction funding during a worldwide pandemic posed some challenges, but the entire team quickly adapted to video calls. There was even a noticeable focus on getting the deal done, as everyone was working from home.
In what way and to what extent do you think the development of ONE22ONE will be affected by the economic slowdown?
Pape: Our development team is doing everything possible to mitigate risk during this uncertain time and impending economic slowdown. The forward approach to design and adaptations we implemented prior to construction will support our efforts to control project costs and deliver on time.
How about leasing activity?
Pape: This month, we announced our anchor tenant—FirstBank, a fast-growing and prolific Nashville-based bank with statewide reach. The financial institution is leasing 52,000 square feet on floors 13 and 14, with the right to expand its footprint within the building to over 100,000 square feet. Additionally, the bank’s parent company, FB Financial Corp., will be headquartered at ONE22ONE. Given the considerable leasing momentum already underway, we expect more tenant announcements to come soon.
What are your predictions for office demand in Nashville?
Pape: ONE22ONE will deliver in 2022. As of now, it is the only office tower in the pipeline for that delivery time frame. Although we are already seeing considerable leasing interest, we are confident that the market will stabilize even more over the next 18 to 24 months, as companies realize that in-person collaboration is still needed for long-term success. Our building is already uniquely positioned given its location, amenities and iconic design that address the needs of the current pandemic environment.