It’s not only jobs and residents flocking to Nashville: lenders are competing to back multifamily developments in the Music City. Developer Tony Giarratana has secured $47.5 million in key financing commitments to allow his company to move forward with its latest development, to be called 505. Located at the corner of 5th Avenue and Church Street in the heart of downtown Nashville, the multifamily property will be developed through a public/private partnership with the Metropolitan Development & Housing Agency (MDHA).
“The 505 apartment high-rise is facilitated by our public/partnership with MDHA, which includes a 99-year lease on 500 spaces in its garage and air rights for a rooftop amenity deck,” said Tony Giarratana in a statement. At 550 feet-tall, it would be the second-tallest building in the city, behind the AT&T Building.
The prime, 505 development site, which Giarratana is contributing to the project, is valued at more than $12.5 million. JLL secured $35 million in mezzanine financing on behalf of Giarratana from Chicago-based LaSalle Investment Management. MDHA has committed an additional $12.5 million in tax increment financing (TIF), which TIF is to be financed by Nashville-based First Advantage Bank. In addition to the mezzanine financing, JLL’s Capital Markets experts, led by Managing Director David Hendrickson, are currently sourcing a $90 million construction loan to complete the project’s $150 million in financing.
“Giarratana and his partners continue to make significant contributions to the economic growth and development of Nashville. First Advantage Bank is excited to be among the partners facilitating the 505 development” says Earl Bradley, CEO, First Advantage Bank.
Designed by Chicago based Solomon Cordwell Buenz, 505 will feature 45 floors with a total of 500 units, the upper third of which are designed to be potentially be sold as condominium residences. Both 505 and the adjacent, MDHA garage will be delivered by late-2017.
The tower will contain 500 apartments. About one-third of the apartments, on the building’s top 16 floors, may be sold as condos, Giarratana said. Those 16 floors would have a dedicated elevator system and would be branded as Paramount, a reference to a theater that used to be nearby.
Th 505 partnership follows several Giarratana collaborations with the MDHA, including The Cumberland, Viridian, Encore and The SoBro. Last year, Giarratana sold the south portion of its prime downtown site to MDHA to develop the 972-space parking garage, retaining the corner portion to develop the residential tower.