Dealmaker: Mesa West Capital Lends $88M in Nashville

Mesa West Capital, Los Angeles, made its first loan in Tennessee by providing Magellan Development Group with $88.3 million to refinance The SoBro, a 313-unit Nashville multifamily building.

The financing included $20.3 million in mezzanine financing that an institutional investor purchased at closing.

The SoBro is a 33-story Class A asset on Demonbreun Street in Nashville’s lower Broadway entertainment district. It delivered in July 2016 and the first residents moved in in October. The property was 25 percent leased at closing.

“The SoBro is a high-quality asset that represents Nashville’s evolution as a desirable market for institutional capital,” said Mesa West Capital Vice President Matt Snyder, who originated the financing from Mesa West’s Chicago office. “Nashville is experiencing significant population growth, especially among Millennials who are flocking to the region for its increasing number of job opportunities along with the region’s active lifestyle and cultural base.” 

Snyder said Magellan Development Group designed The SoBro specifically to meet the demand for urban housing by a Millennial demographic that prefers to rent rather than buy a home. “Our financing will allow Magellan to take advantage of Nashville’s strong job market as they lease up and stabilize the building,” he said.