Henley Station, a 403-unit apartment complex under construction, reflects the Murfreesboro area’s need for upscale apartments in prime locations.

-- Lyle Graves | Nashville Ledger

Cruise down Medical Center Parkway in the Gateway area of Murfreesboro, just east of I-24, and you’ll see a $60 million construction project dominating the horizon.

Henley Station’s 403 apartments are being constructed on Robert Rose Drive, featuring a mixture of three-story brick townhomes, garden apartments and flats that owners say will create “an experience,” not just a place to live.

The units are part of an uptick in multi-family housing permits approved by Murfreesboro Planning Department, which reported 553 such permits during the first two months of 2014, on the heels of 889 in 2013 and 458 in 2012 – all coming after multi-family permitting fell to zero in 2011.

With the market wide open, Ohio-based Lifestyle Communities saw an opportunity in Murfreesboro based on potential population growth, proximity to Nashville and efforts by the Rutherford County Chamber of Commerce to attract five to six corporate headquarters over the next five to 10 years, according to Russell Boiarsky, the company’s marketing director.

“When you have a growing city like Nashville and a growing city like Murfreesboro, sooner or later they’re going to grow together,” Boiarsky says.

Henley Station targets upscale apartment dwellers such as Middle Tennessee State University graduates or “millennials” who have found a first well-paying job and want to stay in an established community, possibly where they grew up, rather than an urban center, says Boairsky, who also explains those apartment dwellers could join thousands who commute to Nashville from Murfreesboro each day.

Lease payments at Community Lifestyles apartments aren’t cheap. They typically run from $800 to $1,500, he notes.

Gateway Village, another residential development in Murfreesboro, is located next door to Saint Thomas Rutherford Hospital and is near The Avenue, a large shopping and dining complex.

-- Lyle Graves | Nashville Ledger

Higher rent will help pay for The Goat, a public restaurant and bar that will be the focal point of Henley Station, the clubhouse, swimming pool, volleyball courts and other amenities.

Leasing could begin in April with units opening in June.

How it fits

Murfreesboro Planning Director Joseph Aydelott calls Henley Station a “traditional neighborhood design” with brownstone and graystone construction. And although it seems to dominate the landscape now, he says, when the open land around it is developed, it should blend in well.

“Right now the ‘in place’ to be for anybody is Medical Center (Parkway) and Fortress Boulevard,” Aydelott explains, calling the latest round of apartment construction a “regional phenomenon” related to growth in the Nashville Metropolitan Statistical Area.

Rutherford County’s population is estimated at 290,000 with Murfreesboro’s at more than 110,000.

Henley Station is being built east of I-24, and Integra Creek, another high-end complex, is located at the revamped intersection of Fortress Boulevard and Manson Pike west of I-24. Aydelott calls it the market leader in cost per square foot.

Both apartment complexes are far from subsidized or student housing, Aydelott points out.

Builders are targeting a number of segments of the population, according to Aydelott: people who’re looking for temporary homes until they buy a house, or seniors who want to live near children and grandchildren, or even professional, single women who want a nice place without the mortgage payment.

Henley Station’s land was rezoned to a planned unit development from office general and commercial, and the project went through more rigorous approval because it’s in the Gateway area, a process that allows city planners to decide what types of building materials are used. Brick was required for most of Henley Station.

During the planning process, some raised concerns about its proximity to Stones River National Battlefield, believing it would detract from the area’s historical feel.

The planning director says that it isn’t adjacent to the battlefield and falls far underneath height restrictions for commercial property.

Everwood, another upscale apartment complex bound for the Gateway area, will go through the same scrutiny. It is proposed off Robert Rose Drive behind Peter D’s, a restaurant under construction along Medical Center Parkway.

Randy Caldwell, of Ragan Smith Associates, is set to help design the land plan and landscaping architecture of Everwood after working on Henley Station.

Caldwell says Henley Station “captures the vision” of the Gateway area, putting residential in the midst of a retail and restaurant area.

Everwood is expected to offer more of the tradition garden-style apartments, Caldwell adds, similar to those at Paddock Club on Thompson Lane near Memorial Boulevard in north Murfreesboro.

‘Hybrid’ development

Yet another upscale project, 3343 Memorial, hopes to compete with Paddock Club and take some of its overflow, Aydelott says.

Set to be built at North Thompson Lane near Erma Siegel Elementary School behind businesses along Memorial, it met resistance from area neighbors initially but gained momentum, and planning commission approval, after its access plan improved.

“It’ll fit in there real well, surprisingly well,” Aydelott says. He explains that its developers opted to add distinction to the apartment complex by making its address its name.

Ross Bradley, vice president of development for TDK Construction, says 3343 Memorial will be “completely different” than any other apartments in Murfreesboro, a “hybrid” development of sorts combining urban and suburban dwelling.

It will have three- and four-story buildings with flat tops and no breezeways, he adds, noting each building will have elevators for residents to use.

Rather than the typical bare-bones apartment, each unit will have luxuries such as granite countertops, backsplashes, tiled bathroom floors, items designed to “dress up” the homes, he explains.

“A lot of the folks we’re getting now are people wanting to downsize,” Bradley says, pointing toward those in their 40s who want the amenities of a custom home without the yard work.

The company, which also has projects under way in Nashville, is calling it “the premier elevated living in town.”

TDX opted for north Murfreesboro, he says, because of existing employers such as York VA Medical Center and State Farm’s regional headquarters, in addition to a new wave of residential development predicted for the area.

It’s also in a coveted zone for Siegel schools. The 241-unit development is set to open in the fall, he adds.

Inside the numbers

The increase in multi-family building permits is part of an overall comeback in housing construction. Murfreesboro allowed 105 single-family permits in the first two months of 2014 and more than 700 in 2013, both strong signs of a building recovery.

From 1999 through 2007, single-family permits topped the 1,000 mark nearly every year and almost hit 2,000 in 2004 before dipping for four years from 2008 to 2012 with a low of 346 in 2010.

Even though the number of multi-family units permitted last year mirrors the statistics for 2008 and 2006, as well as 1994, they pale in comparison to multi-family units approved in 1996, 2005 and 2006 when more than 1,000 units were permitted, with 1,267 in 2005 topping all figures.

Aydelott says that multi-family housing permits come in “big cycles” with each project creating a major impact on the next one. For instance, if occupancy rates reach 98 percent in area apartments, when a 250-unit complex opens, suddenly occupancy rates could hit 75 percent.

Anyone hoping to follow a major complex, especially in the same area, will have to conduct a new marketing study, and lenders might vacillate on whether they’re willing to provide funds for another large apartment community on the heels of another one, Aydelott adds.

Multi-family housing in Murfreesboro is typically divided into distinct areas:

• MTSU student housing with few amenities and high occupancy rates

• Affordable and subsidized housing that can be built on in certain tracts that qualify based on demographics in that area, such as Point on Eastdale at Bradyville Pike and South Rutherford Boulevard

• Upscale housing that is starting to take over the apartment market

Aydelott notes that city planners expect all developers to help pay for their impact, and that includes roads. Henley Station is helping fund some improvements to Robert Rose Drive, and Everwood is being required to connect with The Avenue Murfreesboro, he said.

Likewise, the owners of the Integra Creek gave the right of way for construction of the intersection at Fortress and Manson Pike. Aydelott says city leaders recognized that if they didn’t take action to improve that intersection it would wind up as congested as the area at Franklin Road and Cason Lane.

The owners of 3343 Memorial are making some minor road improvements and paying a special assessment for the cost of previous road work on North Thompson Lane, he adds.

“We see the infrastructure needs, and developers aren’t getting a free ride,” Aydelott explains, adding the companies building the apartments are filling a gap in the housing market.