From The Nashville Business Journal - December 3, 2015
By Adam Schisko
A development poised to be the biggest project downtown Franklin has seen in many years has just grown again, which will postpone the start of construction.
The proposed $86 million Harpeth Square development must come back before city officials for their review starting later this month, after the developers paid $950,000 for yet another piece of the city block bordered by Main and Bridge streets and First and Second avenues north. It is the final piece they plan to acquire within what is one of the original 16 blocks of the historic downtown in Franklin (a block that's mostly idle today).
The city is the county seat of Williamson County, whose population is growing at a faster clip than any of the other 94 counties in Tennessee. The proposed Harpeth Square is one of a few projects signaling heightened investor interest in Franklin, whose Cool Springs commercial hub on the other side of Interstate 65 has long received much more of that attention.
The developers now plan 155 luxury apartments, 14 more than before. The project would combine those units with other elements including retail space and a 115-room, four-star hotel — a hotel that will no longer be developed by Nashville-based Senate Hospitality Group. Overall, it's something of a scale and scope that caused much tension throughout the city's original vetting, before the city approved it in May.
Rod Heller and Jay Franks, both Franklin residents, are the co-principals of developer Harpeth Associates LLC. They've raised $7 million of equity toward the project, which is $1 million more than the tally as of May. Among the newest investors are Sharon Haynes and Dianne Sturdivant, who sold the developers their property at 111 Bridge St. last month.
Steve Bacon, the developer's chief operating officer and executive vice president, said that's enough equity to secure a construction loan for all but the hotel, which he said will be financed separately. Bacon said his group is in early talks for financing from the U.S. Department of Housing and Urban Development.
The mix of apartments is changing, too. Bacon said the project now includes more two- and three-bedroom units (75 and 14, respectively). The target demographic remains current Franklin residents who no longer need quite as much living space, and who no longer want the effort and expense of maintaining their single-family homes and yards.
"We think we have very healthy demand from Baby Boomers and older," Bacon said. "I think we'll get a millennial crowd, but that 'renter by choice' group will be particularly attracted to it."
The expanded version of the project will go before the city's planning commission later this month. The city's Board of Mayor & Aldermen could review and vote on the matter over the course of January and February — a timeline that has Bacon eyeing a June 2016 start for construction. If work started then, the development could open in late 2017 or early 2018.
The project includes a 600-space parking garage that will offer paid parking for the public.
Bacon said his group is in negotiations with a four-star hotel, and in separate talks with a new hotel developer. He declined to elaborate. "We amicably parted ways with Senate Hospitality. We hope to work with them on other things," Bacon said.
Bacon expects the hotel to cost $32 million to develop, close to 40 percent of the project's overall price tag.
In a separate project, Heller and Franks — the co-owners of Harpeth Associates — are part of the group under contract to pay $5 million for the former home of Franklin United Methodist Church. At that site, which is several blocks from the Harpeth Square project, the group is aiming for a mixed-use development as well.