Sophia Young | Nashville Business Journal

Nashville’s construction market has hit its lowest volume in ten years, but many major projects in progress or in the pipeline are keeping experts hopeful.

Last year, the city’s construction volume fell over 11%, and it is predicted to decrease by nearly 20% by the end of this year, according to Cumming’s Q2 2023 construction market analysis report.

In 2020, the city saw a record-high in annual construction volume at just over $12 billion — this year, Cumming’s research predicts the total volume will be around $9 billion.

Rebecca Ozols-Goss, an owner at Nashville-based Bell Construction Co., believes interest rates are the main cause of decreased activity in the industry.

“Everything is fine despite the interest rates. They take the numbers to their bank or their lender, and that’s when the wheels are starting to fall off. They’re struggling to get money that in years past I think would have been handed over easily,” Ozols-Goss said.

High interest rates have made it more difficult for planned projects to break ground, but certain sectors such as infrastructure and health care are keeping the construction industry afloat.

“When vertical gets a little quiet, our infrastructure department tends to speed up because there’s so much federal and state funding for public works. We also have a civil division now. They tend to stay very, very busy despite the economy, and a special project division,” Ozols-Goss said. “If people can’t build, maybe they’ll remodel, so we want to be able to offer those services.”

Though construction volume is down, it was a record-breaking year for Nashville for construction permits.

The Metro Codes Department issued $5.88 billion worth of permits this past fiscal year, which ended on June 20, according to data obtained by the Business Journal. The sum creates a new record — up nearly 18% from the previous fiscal year.

The city has multiple construction projects in the pipeline — anticipated projects like Metro’s East Bank redevelopment and a new Tennessee Performing Arts Center are expected to contribute to an increase in construction volume levels in the coming years.

Cumming predicts construction market value will increase by 16% and could surpass $10 billion by the end of 2024 — a value that is not quite as high as 2021 and 2022 but shows strong growth.

One of the city’s most anticipated projects is the Tennessee Titans’ $2.1 billion domed stadium. This month, the Titans selected the Tennessee Builders Alliance (TBA), a partnership between Turner Construction Co., AECOM Hunt Construction, Polk & Associates and ICF Builders, to manage construction of the stadium for the Tennessee Titans.

“The stadium won’t pause, despite what interest rates might do. TPAC won’t pause, so there’s a lot of comfort there. … Construction is going to stay busy because those projects are a sure thing. And that’s the beauty of Nashville, right? The Titans stadium still goes on despite what we’re seeing, just like Music City Center during the recession of ’08 and ’09,” Ozols-Goss said.

Top regional projects by construction value, according to Cumming’s research:
1. June Lake, $6.6B
2. Oak Ridge’s Uranium Processing Facility, $6.5B
3. Stanton’s Blue Oval City, $5.6B
4. The Riverside Mixed Use, $2.5B
5. Tennessee Titans Stadium, $2.2B
6. Fedex Super Hub Expansion, $1.5B
7. The Pinch Mixed Use, $1B
8. Hobson Drive Mixed-Use, $861M
9. Facebook Gallatin Data Center, $800M


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