Convexity Properties Lands $125M Loan for Nashville Mixed-Use

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Convexity Properties, the real estate development subsidiary of DRW, is moving forward with its 5 City Blvd development, a 15-story, 378,000-square foot Class A mixed-use office and retail space in Nashville, Tenn.

The firm has obtained a $125 million loan from Goldman Sachs for the project, according to public records. In October of 2021, Convexity paid $11.7 million to acquire a 2.17-acre development site for the property from Cambridge Holdings.

Construction on 5 City Blvd is expected to begin toward the end of 2022, with a scheduled delivery in the third quarter of 2024. Space will be available for lease in the first quarter of 2025.

Upon completion, 5 City Blvd will host 360,000 square feet of office, sectioned off into 26,000- to 28,000-square-foot floorplates, as well as 18,000 square feet of ground floor retail. Amenities will include a flex conference center, fitness center, café lounge, concierge, catering kitchen, private parking and 5,700 square feet of shared and private terrace space. The developer has tapped CBRE First Vice Presidents Frank Thomasson and Byran Fort to market the office space.

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The OneCity picture

The complex will be built as a part of Cambridge’s 18.7-acre OneCity master-planned project, which is seeing the construction of 1 million square feet of office space, 35,000 square feet of retail, 600 apartments and Element Nashville West End, a 170-key hotel. Situated along Charlotte Avenue, the development is flanked by many of the city’s most affluent neighborhoods, and is within 2 miles of many of its top employers and universities, as well as its top retail, dining and entertainment offerings.

Nashville’s flight-to-quality

The Nashville office sector has continued to prosper, even in the face of repeated interest rate hikes that have muddied confidence in investing in the asset class. According to data from a third quarter 2022 report from Colliers, the city had 2.8 million square feet of space under construction as of the third quarter, with a net absorption of 157,000 square feet. Class A space in particular has seen a high demand, with 50 percent of new projects coming under lease, data from the report shows.

One recent high-profile office acquisition headline is KBS’ $175.5 million purchase of UBS Tower, a trophy high-rise building in downtown Nashville.