R6 Development in East Nashville

4 Replies

Hello there. I am a current resident in East Nashville. I own a property that is essentially right next to an old manufacturing factory that is being turned into 40,000 soft of retail/restaurants. Not mixed use (no condos attached). I have gotten really into zoning as of late and looked up the area. They bought 4 of the lots across the street and are developing some of that as well as far as I can tell. It is supposed to be finished in the fall.

The home I own like I said is right around the corner. Next to me there was a lot zoned the same as mine, r6, that was recently developed into two units. Both sold for a considerable sum, and that was before this massive retail development was known about. 

I refinanced my home with intentions of purchasing another, but, I am wondering if while the economy is still goodish (i.e. no recession yet), I should try to pull the trigger on developing my own lot. I have some money from the refi like I said but I don't think that it is enough to trigger the development. They developed the lot next to mine very quickly. I would say 9-12 months.

I'm wondering if there is anyone in the area who is familiar with the process. I would sit on the lot for eternity but I'm wondering if it would make more sense to develop it now and have significant finances on the other end to start another project. 

I have a humble day job that pays $35k. Thought that would be worth noting.

Thanks in advance for any of your time and thoughts. 



@Tim George every job is noble my friend.

You are correct. The market is at the peak right now.You should reach out to the developer that did the project next to you and see what they would pay for your property. That would be a much better play than trying to develop yourself.

Thanks for the quick response. I agree that it would be the much smarter play. But say I’m a risk taker. For the sake of conversation is what you are implying more so that there is a chance for things to take a turn for the worst before the project is complete even if everything went well in terms of zoning, development, etc. The difference financially for me would probably be 50k vs 200k. Thanks. 

Originally posted by @Tim George :

Thanks for the quick response. I agree that it would be the much smarter play. But say I’m a risk taker. For the sake of conversation is what you are implying more so that there is a chance for things to take a turn for the worst before the project is complete even if everything went well in terms of zoning, development, etc. The difference financially for me would probably be 50k vs 200k. Thanks. 

If you have the expertise, time and capital to pull it off then go fo it.

If you are not in the business and have never done this you can lose it all real fast.

You could offer to partner with a qualified and experienced builder but you still need to know what your doing and get a real estate attorney to advise you and draft all the agreements. 

@Tim George

In terms of timeline, there is no telling when the BEST time is. I always say the best time to start was 20 years ago, and the second best time is today. 

There's also no telling when this recession is going to start/end. Between today and 100 years from today is my guess. 

Keep in mind, just bc your lot is zoned R6 there are other factors you need to consider for a 2 build. Specifically size of lot and road frontage, as well as alley access, sewer and water lines, etc. There's a bit that goes into it. 

In terms of the loan, if you qualify banks will typically finance 100% of the draws and you will just be responsible for the carrying costs. Your issue is going to be that you already have a loan on the property. No bank is going to lend to you in a second position lien. You will have to do another refinance with a construction loan. It does help however that you already own the lot. 

I've built a few houses on the east side and I can help you get in touch with the right people as well as review your plans, etc.