Wheelock Street Capital Sells Discounted Nashville Office Asset

A 20-story office tower in downtown Nashville has sold for 85 percent of its value five years ago.

Wheelock Street Capital sold Philips Plaza, at 414 Union Street, for $17 million, the Nashville Business Journal reported. The price comes to $39 per square foot. The buyer’s identity is hidden behind an LLC, 414 Union Partners, with a residential address in Belle Meade.

Financing for the purchase included a $16 million loan from Tennessee-based SmartBank.

The seller paid $111 million, or $255 per square foot for the 435,000-square-foot building in 2019, when it was 75 percent leased to tenants including health-tech giant Philips, coworking operator Industrious and Sherwood Boutique Litigation. However, occupancy has since fallen to 50 percent.

The transaction reflects the challenges facing commercial real estate.

Built over 40 years ago and originally named Bank of America Plaza, the tower’s value has plunged alongside broader national trends in office real estate. Elevated interest rates and shrinking tenant footprints have depressed valuations across the sector.

Other major office transactions this year include Menlo Equities’ purchase of Truist Plaza from local firm Eakin Partners for $84.5 million in April. At least two other prominent towers are on the market. Eakin listed Peabody Plaza, at 10 Lea Avenue, in August. And Blackstone Real Estate listed Fifth Third Center, at 424 Church Street, in May.

Nashville experienced its slowest year for commercial real estate sales in over a decade last year, but 2024 brought signs of recovery. Notably, Margaritaville on Lower Broadway sold for a record-breaking $75 million on Thursday, underscoring a renewed interest in downtown assets.

—Rachel Stone