Investment Memo · May 12, 2026

1022 W Kirkland Ave

East Nashville · 37216
Purchase Price
$430,000
Zoning
OR20 · NOO STR
Plan
6 Townhomes
Prepared by
Rok Jung
Scroll · The Thesis
§ 01 · The Thesis

Most buyers read this listing as a distressed home. We read the zoning.

The parcel is zoned OR20 — permitting up to 20 dwelling units per acre and Non-Owner Occupied Short-Term Rental use. Since 2021, Metro Nashville has banned new NOO STR permits in residential zones, making OR20 a closed-supply category. Every grandfathered unit appreciates against a shrinking pool.

We buy what the listing calls a fixer. We sell a 6-unit, fully zoned, shovel-ready STR development site — or build and sell the townhomes ourselves. The gap between those two readings is the entire deal.

Purchase Price
$430,000
No closing costs
Zoning
OR20
6 townhomes · NOO STR eligible
Plan
Demo + Build 6
~2,000 sq ft each
STR Status
Grandfathered
Rare and legally protected
§ 02 · The Comps

All on the same block. Click any card to verify on Zillow.

Every comp below is a new-construction, NOO STR-eligible townhome on or immediately adjacent to W Kirkland Ave in 37216 — literally the same street. Hover and click any card to open the listing on Zillow.

ARV used in underwriting

We underwrite to closed sales only, not active asks. Three cases below:

Conservative
$730K
Base Case
$750K
Upside
$789.9K
§ 03 · Two Paths

Two ways out. Same parcel. Very different capital and timing profiles.

Scenario 1Permit & Sell Shovel-Ready

Low Risk · 80% LTV Land Loan · 6 mo

Get the building permit approved for 6 NOO STR townhomes, demolish the existing house, complete basic site work, and sell the entitled parcel to a developer on MLS. Land financed at 80% LTV; improvements paid in equity. Target hold: 6 months from purchase to land sale.

Land Improvement Costs

Civil engineer / landscape architect$10,000
Building permit fees (Nashville)$5,000
Site survey$4,000
Geotechnical report$4,000
Phase 1 Environmental$2,500
Demo + site grading$30,000
Utility stubs (6 units)$45,000
Misc & contingency (10%)$10,000
Total Land Improvements$110,500

Capital Structure

Land purchase price$430,000
Land loan (80% LTV @ 10%)$344,000
Land equity (20%)$86,000
Improvements (all equity)$110,500
Origination (2 pts)$6,880
Interest (6 mo)$17,200
Carry costs$8,500
Total Equity Required$229,080

All-in project cost: $573,080 · Equity $229,080 + Debt $344,000

How the entitled parcel is priced. Shovel-ready STR-zoned parcels don't trade transparently in 37216 — most move developer-to-developer off-MLS. We bracket the land price using two industry-standard floors and ceilings, both anchored to base GDV of $4.5M (6 units × $750K):
Floor — 20% of GDV: the common "land as % of gross development value" heuristic. 20% × $4.5M = $900,000.
Ceiling — 20% developer net margin: the maximum a builder will pay while still clearing their required 20% profit. On a $4.5M exit, that profit target is $900K. Backing it out: $4.5M − 6.5% selling − $2.04M construction − $231K financing/carry − $900K builder profit = $1,037,000.
Conservative / Base / Upside below walk the realized land price from floor → midpoint → ceiling.
ConservativeBaseUpside
Gross Sale (entitled parcel)$900,000$970,000$1,040,000
Selling Costs (5%)−$45,000−$48,500−$52,000
Net Proceeds$855,000$921,500$988,000
All-In Project Cost−$573,080−$573,080−$573,080
Net Profit$281,920$348,420$414,920
Return on Equity123%152%181%
Annualized (6 mo)~246%~304%~362%

Scenario 2Build 6 Townhomes & Sell

Medium Risk · 70% LTC · 18 mo

Full vertical development. Build, sell all 6 units individually to STR investors on MLS. 18-month hold with construction debt @ 10%.

Total project cost$2,470,000
Loan (70% LTC)$1,729,000
Equity (30%)$741,000
Interest rate10% IO
Origination (2 pts)$34,580
Construction budget$170/sq ft

All-In Costs

Land$430,000
Construction$2,040,000
Origination$34,580
Interest (18 mo)$182,000
Carrying costs$14,000
Total Project Cost$2,700,580

≈ $450,097 per unit · Total equity deployed: $971,580

Conservative ($730K)Base ($750K)Upside ($789.9K)
Gross Revenue$4,380,000$4,500,000$4,739,400
Selling Costs (6.5%)−$284,700−$292,500−$308,061
Total Project Costs−$2,700,580−$2,700,580−$2,700,580
Net Profit$1,394,720$1,506,920$1,730,759
Profit / Unit$232,453$251,153$288,460
Return on Equity144%155%178%
Annualized (18 mo)~96%~103%~119%
§ 04 · Side by Side

How they actually compare.

MetricScenario 1: Shovel-ReadyScenario 2: Build & Sell
Hold Period6 months18 months
Equity Required$229,080$971,580
Cost Basis$573,080$2,700,580
Net Profit (base)$348,420$1,506,920
Return on Equity152%155%
Annualized ROE~304%~103%
RiskLowMedium
Leverage80% LTV land loan @ 10%70% LTC @ 10% construction
§ 05 · Market Tailwinds

Why East Nashville. Why now.

Demand is rising into a frozen supply pool. Closed-supply categories (grandfathered STR) appreciate against shrinking inventory while new event-driven demand multiplies the rent base.

$2.2B
New Titans Stadium

Opens 2027. Massive event-driven STR demand within walking + rideshare distance.

8.5K
Oracle Tech Hub

8,500+ incoming jobs anchoring the East Bank. Drives both rent and exit pricing.

3+
Adjacent Catalysts

Top Golf, Station East, full East Bank redevelopment — all within the same submarket.

0
Frozen STR Supply

No new NOO STR permits in residential zones since 2021. OR20 supply is capped and shrinking.

$899K
Median New Build

East Nashville new construction median, Q1 2026. Our base ARV of $750K sits ~17% below.

+40%
37216 Closings YoY

Closing volume up 40% year-over-year in this exact ZIP — velocity confirms absorption.