SOUTHEAST SNAPSHOT, OCTOBER 2007

Knoxville, Tennessee Office Market

The growth of new office development in the Pellissippi Corridor and the conversion of several Class B and C office buildings into residential units downtown has greatly shifted the Knoxville office market during the last couple of years. In addition, the Knoxville office market is expanding westward due to the price of and availability of vacant land. Many existing office buildings are also undergoing renovation in this area.

Century Park, located at Dutchtown Road and Pellissippi Parkway, is an 80-acre development with an estimated 275,000 square feet of office space in six buildings. Currently, just under 175,000 square feet is complete. Center Point Commons, located at Lovell Road and Pellissippi Parkway, will have 11 office buildings totaling 154,000 square feet. Lakeside Center, located at Northshore Drive and Pellissippi Parkway, has 48,000 square feet under construction, adding to the existing 160,000 square feet of office space. The Brookview Promenade office building, located at Papermill and Interstate 40, will bring 180,000 square feet of office space to the market within the next year and a half. Parkside Plaza, in Turkey Creek, just completed its second office building,  bringing the total square footage to just more than 150,000 square feet. All of these new developments are raising the bar for Class A office space in Knoxville.

The majority of the development is taking place along the Pellissippi Corridor. The Pellissippi area is convenient to the Airport, Oak Ridge and the new residential and retail growth. Scripps has taken 30,000 square feet at 830 Corridor Park Boulevard; while Morgan Keegan and Sunoco took space at Turkey Creek on Parkside Drive.  

The average rental rate for the Knoxville office market is $19 to $27 per square foot, while the vacancy rate area wide is 12 percent.

As retail and residential development continues in north Knoxville, the office market is anticipated to follow suit with more development. The Hardin Valley area, which is just ahead of north Knoxville, has some new office complexes coming out of the ground with more on the horizon.

— John M. Adams III is with Wood Properties, Inc., in Knoxville, Tennessee.


©2007 France Publications, Inc. Duplication or reproduction of this article not permitted without authorization from France Publications, Inc. For information on reprints of this article contact Barbara Sherer at (630) 554-6054.