Blackstone Real Estate Debt Strategies provided a $310 million bridge loan to refinance Peabody Union, a newly completed 27-story mixed-use development in Downtown Nashville, Tennessee. Commercial Observer reported that the financing was secured by a joint venture among PGIM, Stiles Corporation, and Hensler Development.
A JLL Capital Markets team of Ed Coco, Paul Stasaitis, Matt Casey, Anthony Sansone, Kelsey Bawcombe, and Streeter Simmons arranged the debt transaction for the sponsors. The debt package is structured as a three-year bridge loan with two one-year extension options.
What happened
Peabody Union is located at 30-50 Peabody Street in Downtown Nashville's South Bank district along the Cumberland River. The 665,000-square-foot property contains 355 luxury residential units and 52,735 square feet of experiential retail scheduled to open next year. Commercial Observer noted that the building secured an office lease commitment from Starbucks for nearly 250,000 square feet starting next year.
The tower also features two 2,000-square-foot outdoor terraces on the sixth floor, a 4,500-square-foot fitness and wellness center, a 4,000-square-foot resident club room, and 1,000 square feet of bike storage. JLL reported drawing strong interest from several lender types before finalizing terms with Blackstone to take out construction financing.
What it changes for a closing
For deal teams and closing counsel, closing a $310 million bridge financing across an asset with residential, commercial office, and retail components requires complex structuring around extension tests and future tenant obligations. The two one-year extension options require clear milestone criteria in the loan agreement, including minimum debt yield thresholds and operational benchmarks.
Because Starbucks committed to nearly 250,000 square feet starting next year and retail spaces remain in development, closing teams must establish dedicated reserves for tenant improvements and leasing commissions. Counsel must coordinate subordination, non-disturbance, and attornment agreements for incoming commercial occupants while verifying punch-list completions and final contractor lien waivers from recent construction.