1Q

2011

2Q

2011

VACANCY

NET ABSORPTION

CONSTRUCTION

RENTAL RATE

MARKET REPORTNASHVILLE

www.colliers.com/Nashville

Retail Market Stable, Welcomes New Retailers The first half of 2011 has been relatively stagnant with little growth. The retail market has 60,266 of negative absorption for the second quarter with about 3.4 million square feet of vacant space. The vacancy rate was 7.1%, a slight increase from the first quarter at 6.8%. Rental rates continue to decline to $16.58 per square foot, a decrease of $0.69 since the second quarter of 2010. The highest rental rates continue to be in the Green Hills and Belle Meade submarket.

The retail market in Nashville still suffers from the impact of the his-toric flood in May of 2010 which closed the Opry Mills Mall. The Mall has been rescheduled to open its doors again in Spring of 2012 with new tenants Calvin Klein, Coach Factory Store, The LEGO Store, Under Armour Factory Store, White House Black Market and others. In addi-tion to these stores, the Green Hills area welcomes two new retailers:

MARKET INDICATORS

2Q 2011 | RETAIL

Quarterly Comparisons and Totals

QUARTER BUILDINGSTOTAL INVENTORY

SFDIRECT VACANT

DIRECT VACANCY RATE

SUBLEASE VACANCY RATE

NET ABSORPTION CURRENT QTR

AVG ASKING RATE

Q2.11 698 48,716,038 3,434,756 7.1% 0.2% (60,266) $16.58

Q1.11 698 48,687,848 3,332,504 6.8% 0.3% (14,809) $16.74

Q4.10 699 48,719,737 3,370,385 6.9% 0.3% 140,620 $16.93

Q3.10 694 48,489,601 3,633,061 7.49% N/A (25,620) $17.33

Q2.10 640 38,260,704 2,425,307 6.34% 0.2% (61,721) $17.27

By Property Type

BUILDING TYPE BUILDINGSTOTAL INVENTORY

SFDIRECT VACANT

DIRECT VACANCY RATE

SUBLEASE VACANCY RATE

NET ABSORPTION CURRENT QTR

NET ABSORPTION YTD SF

Conv/Strip Ctr 285 5,077,622 619,327 12.2% 0.5% (10,805) 33,081

Big Box 111 9,011,248 266,123 3.0% 0.7% 0 0

Community Ctr 39 8,900,171 757,439 8.5% 0 5,000 5,727

Regional Ctr 1 563,479 51,147 9.1% 0 0 0

Super Reg Ctr 8 5,827,247 116,589 2.0% 0 30,000 30,000

Neighborhood Ctr 245 16,205,712 1,562,279 9.7% 0.1% (58,736) (69,842)

Power Ctr 9 3,130,559 61,852 2.0% 0 (25,725) (26,925)

- -

Updated 7-2011

Nordstrom’s and the Container Store. Nordstrom’s, opening in September, will be a three-story, 149,000 square foot facility an-choring the south side of the Mall at Green Hills. This mall will also be replacing the recently closed Davis Kidd Booksellers with the Container Store, a space estimated to be 30,000 square feet.

While many popular national retail-ers are beginning to make ap-pearances in Nashville, other big names are closing. Companies like

Blockbuster, Borders and Game-stop have started to close several locations across the Nashville MSA.

With low consumer confidence, high unemployment rates and general discomfort with the cur-rent economy, the Nashville retail market continues to rely on the whims of the local and national economies. Though this quar-ter showed little growth, experts remain positive for the second half of the year.

Power Ctr

Neighborhood Ctr

Super Reg Ctr

Regional Ctr

Community Ctr

Big Box

Conv/Strip Ctr

-30000

-25000

-20000

-15000

-10000

-5000

0

5000

10000

15000

20000

25000

30000

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2Q 2011 | Vacancy Space By Type 2Q 2011 | Net Absorption By Submarket

RECENT SALES TRANSACTIONSSALES ACTIVITY

PROPERTY SELLER/BUYER SALE PRICE SIZE SF SUBMARKET

5318 Hickory Hollow Pkwy Bank of America/Freeland Realty $2,950,000 111,409 Southeast Corridor

McKay’s Village Barclay Group/Tate Development Corp $11,900,000 83,652 Cool Springs/Franklin

Shoppes of Edge-O-Lake Bank of Nashville/Summit Equities, LLC $3,500,000 36,550 Southeast Corridor

4075 Mallory Lane Drivers Way of Franklin, Inc./CarMax $7,300,000 29,548 Cool Springs/Franklin

1415 Liberty Pike Tate Development Corp/Evan’s Properties $4,400,000 14,820 Cool Springs/Franklin

Senachie Pinnacle Bank/HTDG, LLC $2,000,000 13,003 Downtown

RECENT LEASING TRANSACTIONSLEASING ACTIVITY

PROPERTY ADDRESS TENANT SIZE SF TYPE SUBMARKET

135 River Rock Blvd Price Point Furniture 50,325 New Murfreesboro

Western Plaza Tractor Supply Co 36,854 New Mt. Juliet/Lebanon

2125 Abbott Martin Rd Container Store 30,000 New Green Hills/Belle Meade

Former Rhodes Furniture Renal Care Group, Inc 27,809 New Bellvue

2525 West End Barnes & Noble/Vanderbilt Bookstore 27,065 New West End

118 16th Ave South Off Broadway Shoes 21,734 Renewal West End

DEFINITIONS

Absorption - The net change in occupied space between the current quarter and the previous quarter, calculated by summing all the positive changes in occupancy and subtracting all the negative changes in occupancy.

Available SF - Space currently being marketed for lease or sublease.

Inventory - The total square footage of all single and multi tenant retail properties above 10,000 SF.

Total Building SF - All single & multi tenant office buildings above 20,000 SF excluding medical, government and owner occupied.

Vacancy Rate - Percentage rate of the total amount of physically vacant space divided by the total amount of existing inventory.

P. 2 | COLLIERS INTERNATIONAL

MARKET REPORT | Q2 2011 | RETAIL | NASHVILLE

UPDATE Market Comparisons

RETAIL MARKET

SUBMARKET BLDGSTOTAL

INVENTORY SF

DIRECT VACANT

SF

DIRECT VACANCY

RATE

DIRECT VACANCY

RATE PRIOR QTR

SUBLEASE VACANCY

RATE

NETABSORPTION

CURRENT QTR ST

NET ABSORPTION

YTD SF

AVG ASKING RATE

BELLVUE/WEST NASHVILLE 36 2,987,939 65,298 2.2% 2.1% 0.0% (1,900) (2,900) $16.07

BRENTWOOD 32 1,601,523 54,093 3.4% 3.7% 0.2% 3,558 3,558 $16.09

COOL SPRINGS/FRANKLIN 96 7,575,802 342,130 4.5% 4.6% 0.0% (29,155) 13,658 $20.62

DONELSON/HERMITAGE 35 2,866,529 146,131 5.1% 4.5% 0.3% (1,025) 1,695 $13.33

DOWNTOWN/WEST END 42 1,293,477 133,794 10.3% 10.2% 1.4% (1,400) 2,389 $20.70

GREEN HILLS/BELLE MEADE 43 2,717,742 111,187 4.1% 4.2% 0.5% 29,511 29,975 $23.91

HENDERSONVILLE/GALLATIN 58 4,274,117 341,155 8.0% 7.7% 0.0% (17,600) (17,931) $14.09

MT. JULIET/LEBANON 42 4,213,932 340,883 8.1% 8.4% 0.0% (2,700) (12,200) $12.27

NORTH 75 6,270,164 428,579 6.8% 6.7% 0.0% 1,390 (1,148) $13.52

RUTHERFORD COUNTY 126 7,937,748 780,536 9.8% 9.0% 0.0% (24,791) (43,542) $17.12

SOUTHEAST CORRIDOR 112 6,932,065 685,970 9.9% 9.7% 0.9% (13,154) (4,513) $12.94

SOUTHWEST 1 45,000 5,000 11.1% N/A 0.0% (3,000) 3,000 $12.00

GRAND TOTAL 698 48,715,038 3,434,756 7.1% 6.8& 0.2% (60,266) (27,959) $16.58

COLLIERS INTERNATIONAL | P. 3

MARKET REPORT | Q2 2011 | RETAIL | NASHVILLE

DOWNTOWN

Gallatin Rd.

Leba

non P

l.

West E

nd A

ve.

Harding Pl.

O ld Hickory Blvd.

Fran

klin

Moores Ln.

Murfreesboro Rd.

Nolensville Rd.

Briley

Pkwy.

Bell Rd

.

Woodmont Blvd.

MURFREESBORO

BELLVUE

COOL SPRINGS/FRANKLIN

BRENTWOOD

GREEN HILLS/BELLE MEADE

CHARLOTTE PIKE/CLARKSVILLE HWY.

MADISON/GOODLETTSVILLE

HENDERSONVILLE/GALLATIN

MT. JULIET/LEBANON

LAVERGNE/SMYRNA

NOLENSVILLE PIKE

RIVER

GATE

WEST END AIRPORT/MURFREESBORO RD.

DONELSON/HERMITAGE

ANTIOCH/HICKORY HOLLOW

NASHVILLE:

Nate GreeneManaging Partner300 BroadwayNashville, TN, 37201TEL +1 615 850 2729FAX +1 615 850 3229

MARKETING DIRECTOR:

NashvilleAllison Schepman300 BroadwayNashville, TN, 37201TEL +1 615 850 2748FAX +1 615 244 2957

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The information contained herein has been obtained from sources deemed reliable. While every reasonable effort has been made to ensure its accuracy, we cannot guarantee it.

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Figure 1: Nashville Retail Submarkets include Bellevue/West Nashville, Brentwood, Cool Springs/Franklin, Donelson/Hermitage, Downtown/West End, Green Hills/Belle Meade, Hendersonville/Gallatin, Mt. Juliet/Lebanon, North Nashville, Rutherford County, Southeast Corridor and Southwest.

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MARKET REPORT | Q2 2011 | RETAIL | NASHVILLE