United States -  Nashville

Nashville has historically been one of the strongest lodging markets in the United States given its designation as a top-tier travel destination and its diverse economy, inclusive of strong employment in the medical, manufacturing, music/entertainment, and tourism industries. Market demand levels improved steadily and significantly between 2010 and 2019, attributed to a variety of factors, including the opening of the Music City Center; corporate expansions and relocations in the area, including firms such as Nissan North America and HCA; and the increased international reputation of Nashville as a premier tourism destination. After rising from 2002 through 2006, occupancy levels declined through 2009, similar to national trends amid the Great Recession. However, occupancy began to recover in 2010, and lodging fundamentals improved through 2016, with RevPAR increasing by double digits from 2013 through 2015. This period of strength led to a rapidly growing new supply pipeline, prompting a modest decline in occupancy in 2017 and 2018. Occupancy remained relatively stable in 2019, despite the entrance of a highly concentrated mix of upper-upscale and luxury hotels, while ADR growth remained strong, climbing to a new peak in 2019. This stabilization in occupancy can be attributed to a record number of both transient and group visitors to the area.

The greater Nashville lodging market experienced a rapid decline in both occupancy and ADR following the onset of the COVID-19 pandemic. Many of the city's flagship hotels closed for weeks as countless group events and conventions were canceled amid the early uncertainty of the virus. Despite suppressed occupancy levels, some of the city's major hotel projects opened amid the pandemic. Although incoming new supply over the next several years remains high, some projects have been delayed or canceled, which bodes well for occupancy levels in the near term. The area faced fewer local restrictions than other major metropolitan areas during the pandemic, which allowed a recovery to begin in June 2020. Since the lifting of pandemic-related restrictions in May 2021, performance at area hotels rebounded at a swifter pace, with notable demand increases reported in the summer months. Despite the positive trends, CMA Fest was canceled in 2021 for the second year in a row, and other events were rebooked. In June 2021, Oracle announced the opening of a $1.5-billion tech campus in Nashville's East Bank neighborhood; the project will be developed over the next ten years and will reportedly employ roughly 8,500 people. Nashville's diverse economy and strong tourism industry, as well as the growing number of corporate relocations to the area, should support a strong recovery over the next few years.

* Although the HVI cannot tell you what a particular hotel is worth, it does provide excellent “big picture” data, indicating which market areas are experiencing positive trends, and thus may present good investment opportunities. The HVI for the U.S. is a measure of the strength of the lodging industry as a whole and, specifically, the hospitality investment market. The HVI for the various identified markets can provide a basis to evaluate and compare different geographic regions. For more insight on the limitations and applicability of the HVI, please read the message on the HVI home page by clicking on the graphic at the top of this page.

Change In Value For Market:

Significant Value Increase: Greater than +10%
Moderate Value Increase: Between +3% and +10%
Stable Values: Between -3% and +3%
Moderate Value Decline: Between -3% and -10%
Significant Value Decline: More than -10%

For more information, please contact:

Marc Greeley
Vice President
Valuation, Market & Feasibility Consulting
[email protected]
  • +1 615 426-8806 (w)