Lower Broadway Submarket

Ardent was approached by a successful Atlanta restaurateur who was interested in opening a location in the Lower Broadway submarket in Nashville, Tennessee.  Lower Broadway is a renowned entertainment district and the most popular tourist area in the city.  The restaurateur had previously attempted to branch out to that area of Nashville but had never found success. At the time, there were very few sales occurring due to the perceived value of the properties and the reluctance of owners to sell. Most transactions occurred in the $350-450/SF range, but those prices were not high enough to garner interest from the long-time property owners. Ardent searched the market for all available off-market properties and found 312 Broadway.  This property was leased month-to-month to a retail user paying below market rents. That lease included a 90-day landlord termination option, which allowed a value-add structure through new tenants. Ardent presented a strong $500/SF offer that many critics at the time viewed as far too high for the area. The offer was accepted and Ardent purchased the 3-story, 9,480 SF retail building for $5 million. The restauranteur signed an 11 year NNN lease for the entire building at $510,000 a year ($53.80/SF).  The tenant also invested $2.3M into the building and added 2,000 SF of additional space on which Ardent was able to collect additional rent. 18 months after first purchasing the building, Ardent was able to sell the building for $10 million ($877/SF). Ardent has since purchased multiple properties on Lower Broadway and continues to find new value-add opportunities in that submarket.