The economy of Tennessee’s capital city has proven indomitable over the past several years, even given the upsets in the markets and the gridlock in the federal government. The stability of state government and educational institutions, growing healthcare and automotive companies, and robust music and tourism industries continue to create billions in economic impact and maintain vibrant levels of hotel demand. The state-of-the-art Music City Center, which opened in May of 2013, has more than two dozen events booked for October alone, which will bring in an estimated 33,100 delegates. This forward momentum should translate into improving performance levels for Nashville’s hotel industry, which has recovered remarkably since the recession. These factors keep Nashville among the most sought-after markets for hotel acquisitions, as well as one of the most active in terms of new development.
Economic Update
As part of a pro-growth and pro-business agenda, Mayor Karl Dean and the members of the Metropolitan Council have actively used city tax incentives to attract or keep companies in Nashville. This has kept Nashville’s population growing and earned the city a place on many top economic growth lists.
While unemployment remains above pre-recession levels, Nashville’s total workforce has grown steadily over the past three years. Nashville is the second-biggest center of music production in the U.S., and Nashville’s music and entertainment industry reportedly produces a $10-billion annual economic impact on the region. Nearly every major music label and many independent labels have a presence in Nashville, which is also home to Gibson Guitar Corporation, one of the world’s most venerable manufacturers of guitars and other musical instruments. Rounding out the mix, festivals such as the CMA Music Festival and Bonnaroo attract thousands of visitors to the area each year.
The medical industry in Nashville employs more than 200,000, contributes more than $30 billion to the local economy each year, and comprises more than 250 companies, including HealthSpring, Hospital Corporation of America (HCA), and Vanderbilt School of Medicine. HealthSpring is currently consolidating its Nashville operations with the construction of a headquarters campus; the $54-million facility will reportedly increase HealthSpring’s workforce by more than 1,300 employees by the end of 2013. Furthermore, the planned West End Summit development will house new offices for HCA and the Sarah Cannon Research Institute and bring an estimated 1,000 new jobs.
The 2013 annual state Automotive Manufacturing Strength rankings, as published by Business Facilities, underscore the importance of the automotive industry in Nashville—the state of Tennessee ranked first in the nation for the fourth consecutive year. Nissan North America completed a four-year relocation process in 2010, opening its corporate headquarters in the Nashville suburb of Franklin. Nissan, which operates its largest North American manufacturing plant in nearby Smyrna, announced in June of 2013 that it would add more than 900 manufacturing jobs for future production of the Nissan Rogue. Moreover, in 2013, Nissan began production of lithium-ion batteries for its LEAF electric car at a new $1-billion battery plant in Smyrna. Nashville is also home to Bridgestone America’s Tire Operations, the North American business unit of Bridgestone Corporation, the world’s largest tire and rubber company.
Recently announced business expansions and relocations are building on Nashville’s solid economic cornerstones. In July of 2013, Aramark announced plans for a new $20-million facility in Nashville that will create approximately 1,000 new jobs by 2017, and UBS plans to bring 1,000 jobs to a new downtown office location over the next five years.
