East Bank development deal advances toward final Nashville Council consideration

A deal to redevelop the first 30 acres of Nashville's East Bank advanced, with a few changes, on Tuesday toward what could be a final vote later this month.

Additions included requirements for an archaeological survey and provisions addressing street design and affordable housing details.

The deal lays out plans for Boston-based developer The Fallon Company to develop 30 acres of Metro-owned land and lease it from the city for the next 99 years. The agreement would require Fallon to deliver 1,550 residential units (including 695 affordable units) in addition to ground-level retail space, hotels, office space and a portion of the planned East Bank Boulevard. Metro Council approved the deal on its second of three readings Tuesday by voice vote, with District 1 Council member Joy Kimbrough voting against.

Approved amendments to the deal included:

• Requiring an archaeological survey prior to construction in response to concerns that redevelopment will disrupt or destroy Indigenous historical sites

• Striking language that would have barred dry cleaning and secondhand stores from the 30-acre area

• Affirmation that Metro and Fallon will comply "to the extent feasible" with public mobility infrastructure standards espoused in the Imagine East Bank vision plan, Nashville's Vision Zero action plan to enhance pedestrian safety and Mayor Freddie O'Connell's executive order on "complete streets"

• Requiring "affirmative marketing" to ensure information about income-restricted buildings reaches diverse populations

• A provision requiring at least 15% of the units in each income-restricted residential building be two- or three-bedroom units

• A statement requiring the developer to "in good faith ask the initial operator of (a day care facility to be located in the first residential building constructed) to consider providing preferential admission for children of tenants of the Residential Building in which the (facility) is located.”

A separate, nonbinding resolution outlining a deal with the Tennessee Performing Arts Center to build a new facility on the East Bank and pay for key infrastructure was deferred to track with the final vote on the Fallon agreement.

If the legislation does not pass at the council's April 16 meeting, the last meeting before the city's annual budget process begins in May, consideration will be bumped to July. Metro's memorandum of understanding with TPAC will need to be formalized through binding legislation before the new center's development can move forward. Metro Council is expected to review that agreement this summer.

What's going where

Parcel C

• Hotels. A maximum of three hotels are permitted within Metro's initial 30 acres, with the exception of a potential hotel located on Parcel B to the left of the new Nissan Stadium.

• Open-air plaza. The plaza space adjoining the new stadium will be built, furnished and maintained by the Titans.

• Parking. Metro could build a city-financed parking garage for Titans use on this parcel, though Metro Cheif Development Officer Bob Mendes said the city will likely hold off, relying on surface parking to fulfill Metro's 2,000-space commitment to the Titans in the deal to build a new stadium.

Parcel B

• Hotel. Hotel development on Parcel B will not count toward the 3-hotel limit for the 30-acre initial development zone (if all residential building milestones are met).

• Parking. The Titans will develop parking on land to the left of the stadium and will receive all revenue from this parking. Metro will have the option to build structured parking on the parcel at Metro's cost.

Parcel G

• Affordable Housing. A 300-unit income-restricted building would be part of the first phase of construction, estimated to begin in 2026. Of the 300-unit total, 200 would be reserved for tenants at 60% Area Median Income (AMI) and under. The remaining 100 units would be reserved for tenants between 60% and 80% AMI. Affordability levels are locked in for the duration of the 99-year ground lease. The building must also include space for a day care center.

• Office space. Fallon would have 10 years to find a market-rate office tenant for Parcel G (or another piece of Metro-owned property). If no tenant can be found, the space could be developed for other uses, including a hotel that would not be counted toward the hotel limit.

Parcel E

• TPAC. A new Tennessee Performing Arts Center will be the main feature of Parcel E. TPAC will cover the cost of utilities not already being installed as part of Metro's agreements with the Titans or Fallon, storm water management and improvements to Waterside Drive and Victory Avenue.

• Seigenthaler Pedestrian Bridge extension. TPAC and Fallon will shoulder most of the cost of extending and redesigning the East Bank landing of the bridge to "enhance pedestrian and bicycle access." Contract agreements would ensure no private party could completely shut down access to the bridge, a major link between the East Bank and downtown. A pedestrian and bicycle path called "Cumberland Walk" would stretch from Shelby Avenue and Interstate Drive to the Cumberland River.

• Another unspecified structure. Fallon would have room to develop another structure near the East Bank Boulevard.

Parcels D and F

• Hotels and housing. Fallon may build hotels and housing on these parcels. The agreement would require Fallon to build a total 1,550 units (including 695 income-restricted units) across five residential buildings on the 30-acre development. That includes two fully affordable housing developments, one of which would be located on Parcel G and another on Parcel A. Market rate residential buildings would include 95 income-restricted units.

Parcel A

• East Bank Transit Hub. A hub for WeGo bus transit and multimodal options (think scooters and bicycles) is envisioned for Parcel A, which sits on what will be a new East Bank Boulevard.

• Affordable housing. Fallon would build 300 income-restricted units atop the transit hub.

Public comment surrounds lack of Indigenous representation

Members of the public on Tuesday called for the recognition of Indigenous peoples in the first phase of East Bank construction.

Indigenous Peoples Coalition Chairperson Albert Bender said the coalition has been "trying for some time now to get an Indigenous park as part of the projects on the East Bank, but no way have we been even remotely successful."

The initial 30 acres included in the proposed agreement with Fallon does not include park space. The city's vision plan for Metro-owned property on the East Bank includes a large park and greenway space slated for areas currently at least partially obstructed by railway tracks and the current Nissan Stadium.

The organization asked if more acreage could be added to the first phase of development to include such a park, to no avail, Bender said. "This will result in egg on the face of this body, and it won't just be an egg, it will be an omelet," he said.

District 16 Council member Ginny Welsch requested "some sort of acknowledgement" of Indigenous history in Nashville in the first phase. Metro Chief Development Officer Bob Mendes said "it is the administration's intention that once we actually have a neighborhood there rather than a series of parking lots that there is an appropriate recognition," though it's not clear exactly what that might be at this point in the process.

"If we can figure out a way to at least document the intention, we'll do that," Mendes said.

By the numbers

According to Metro documents, infrastructure for the 30-acre development zone will cost about $66.5 million in today's dollars (not including contingencies and other "soft" costs).

• Fallon will cover approximately $32.8 million, including roadways and a portion of the pedestrian bridge extension

• TPAC will fund and construct about $30.6 million in infrastructure and pedestrian bridge improvements

• Metro will fund about $3.1 million to relocate a pipeline and extend the "Music City Mile" pedestrian bridge across the East Bank Boulevard. (Should Metro decide to build a parking garage to comply with its 2,000-space pledge to the Titans, it could cost the city upwards of $46.8 million).

Fallon and The Laborers' International Union of North America Local 386 struck a deal this week that strengthens worker pay and security protections, something labor advocates lauded.

Under the proposed agreement, TPAC will cover all of its own construction and operating costs. Metro would enter into a 35-year lease with rent set at $100 per year with two optional 30-year renewal terms (with rent then set at 25% of the market value at that time, with annual increases).

Fallon's rent for the 99-year lease would be based on market value with a 2.5% escalator each year (with the potential of another 0.25% adjustment every decade). Upon the sale or refinancing of any leased property within the 30-acre initial development zone, Metro will receive a percentage of the proceeds: 0.75% for market residential ground leases and 1% for other ground leases (0% for all-affordable residential buildings).

As an example, Metro could make around $560,000 in annual rent for a 2-acre residential property valued at $14 million. Should that property sell for $240 million, Metro would make $1.8 million (0.75%) from that sale.

This article originally appeared on Nashville Tennessean: East Bank plan advances toward final Nashville Council consideration