JLL Arranges $310M Blackstone Bridge Loan for PGIM, Stiles and Hensler Development's Peabody Union in Nashville

JLL's Capital Markets group has arranged $310 million in bridge financing for Peabody Union, a 665,000-square-foot mixed-use development on the Cumberland River in downtown Nashville's South Bank district, the firm announced Nov. 4. The borrower is a joint venture between PGIM and Stiles | Hensler, the partnership of Stiles Corporation and Hensler Development.

Blackstone Real Estate Debt Strategies (BREDS) provided the three-year loan, which includes two one-year extension options. JLL worked exclusively on behalf of the borrower.

Peabody Union Bridge Loan Terms and Deal Team

The $310 million bridge loan carries a three-year term with two one-year extension options. The financing equates to roughly $466 per square foot based on the project's 665,000 square feet, though the loan may cover only a portion of project costs and the figure is not a valuation metric.

JLL's Capital Markets Debt Advisory team representing the borrower was led by Senior Managing Directors Ed Coco and Paul Stasaitis, Managing Director Matt Casey, Director Anthony Sansone, Vice President Kelsey Bawcombe and Associate Streeter Simmons.

"Peabody Union represents one of the most compelling mixed-use financing opportunities in the Southeast, combining trophy-quality construction, an exceptional sponsorship team and a transformational office lease commitment from Starbucks Corporation," said Coco. "We had a significant amount of interest from a variety of lender types."

Starbucks Anchors Office Component at 50 Peabody

Completed in 2025, Peabody Union comprises a 27-story, 355-unit residential tower, 249,988 square feet of Class A office space and 52,735 square feet of experiential retail and restaurant space.

The office component, 50 Peabody, is 100% leased to Starbucks Corporation, which will take occupancy in 2027 as its Eastern Headquarters. The building's amenities include two 2,000-square-foot outdoor terraces on the sixth floor, a 4,500-square-foot wellness facility with full locker rooms, a 4,000-square-foot club room on the second level, 1,000 square feet of conditioned bike storage, dedicated VIP parking and EV charging infrastructure.

Residential and Retail Components

Olive at Peabody Union, the residential component, features 355 units averaging 1,020 square feet across studio, one-bedroom, two-bedroom and penthouse layouts. Amenities include the Six15 Club sky lounge on the 26th floor, a pool deck with cabanas and a hot tub, cold plunge, infrared sauna, fitness center, co-working spaces, a dog run and pet spa, and a movie lounge. Units include quartz countertops, kitchen islands, private balconies, full-size washers and dryers and smart thermostats.

The retail component is 49.9% leased. First-generation restaurants Moxies, Ometeo and Jeni's Splendid Ice Creams are scheduled to open in 2027.

The development anchors South Bank and integrates with the Cumberland River Greenway trail system. It includes a $3 million public infrastructure investment, including Bluff Landing, a one-acre civic landscape improvement.

Nashville Market Context

The financing comes as Nashville's office market shows improving conditions, though vacancy remains elevated. CBRE reported third-quarter 2026 overall vacancy of 17.7%, availability of 23.3%, 152,000 square feet of quarterly net absorption and average asking rents of $37.30 per square foot. Colliers measured vacancy at 17.4% and Class A asking rents at $42.08 per square foot. Savills reported nearly 3 million square feet of year-to-date leasing, up 28% year over year, with availability falling to 17.5%, its lowest level since the first quarter of 2021, and Class A asking rents of $40.45 per square foot.

In multifamily, Matthews reported second-quarter 2026 net absorption of 2,755 units against 1,189 deliveries, with vacancy falling to 5.40% from 6.21% in the prior quarter and average effective rent of $1,612. By the third quarter, trailing-12-month completions totaled 5,513 units, down 39% year over year, and vacancy was 5.3%. About 11,383 units remain in the development pipeline, equivalent to roughly eight and a half quarters of absorption at the trailing pace.

Stabilization Bridge Outlook

The transaction is structured as a stabilization bridge rather than a refinance of a seasoned asset. The office tenant's occupancy is forthcoming in 2027, and about half of the retail space remains to be leased. The three-year term with extension options gives the ownership group time to complete leasing and operating stabilization before pursuing permanent financing.

PGIM is the global asset management business of Prudential Financial, Inc., with $1.5 trillion in assets under management as of June 30, 2026. Stiles, established in 1951, has developed more than 54 million square feet across the Southeast. Hensler Development's founder, Ray Hensler, previously served as president of Stiles' Nashville division, and his Nashville projects include the Adelicia, Twelve Twelve and Wrenstone.

Sources

• JLL: JLL arranges $310M financing for landmark riverfront mixed-use development in Nashville