April 21, 2015
Old Nashville Convention Center Sale Advances
The Metro Council gave preliminary approval Tuesday to sell the city's old convention center on Commerce Street to a team of developers who plan to transform it into a $400 million private mixed-use development.
Approval of the proposal pushed by Mayor Karl Dean came on a second of three votes Tuesday. The vote was unanimous, an indication it will sail through on final consideration next month.
Dean's redevelopment proposal, billed as a new destination for Lower Broadway, calls for 205,000 square feet of retail, restaurant and entertainment uses; 300,000 square feet of class A office space; 350 apartment units; and space for a long-awaited new National Museum for African-American Music.
The museum has proved to be a major selling point for many council members, who have applauded securing a location for a project that has struggled for funding to open.
"We've been working on it for 16 years now," Councilwoman Erica Gilmore, who represents the downtown area, said of the museum. "It's finally a reality. It has a physical place, it's committed, and it's moving forward."
Lead developer on the project is Spectrum | Emery, which has partnered with OliverMcMillan, a San Diego-based commercial real estate firm.
The retail component would bring shopping options not available downtown. Stores and restaurants would line a new road that would connect to Broadway and Fifth Avenue. A park would front the Ryman Auditorium, with the office and residential towers occupying opposite ends of the property.
Parameters of the financial agreement are unique given Metro's interest in finding a use for the 28-year-old Nashville Convention Center, which is now obsolete with the recent opening of Music City Center.
Developers have agreed to pay $11 million to Metro — $5 million of which would occur at closing of the land — for property that was appraised at $27 million. Closing is to take place by the end of this year, but developers would have four opportunities to extend the deadline by three months by paying $250,000 for each quarterly extension.
The project — one of Dean's last before his term expires in September — is not guaranteed to happen, however.
Metro Finance Director Rich Riebeling has said the biggest "risk" with any deal like this is that the development team is unable to secure financing. However, Metro would not turn over the property until financial satisfaction is met. Riebeling has said he's confident the developer will produce.
For Metro's end of the deal, Nashville's Convention Center Authority would oversee construction of a $32 million 781-space parking garage, paid off by parking revenue. The Metro Development and Housing Agency's board also is set to consider $25 million in tax-increment financing for the project, all which would come from revenue the new development produces.
In addition to the land payment, developers also have agreed to pay $7 million for the center's demolition; $11 million to build the museum; and $7 million to build meeting space for the adjoining Renaissance Hotel.
The new plan for the old convention center site follows a previous plan pushed by Dean to covert the property into a medical trade center. That proposal fell apart three years ago.
Link to original article here.