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An ordinance authorizing the Metropolitan Government's execution and delivery of a development agreement and ground lease agreement with the Tennessee Performing Arts Center Management Corporation, a campus operations and use agreement, and other documents and agreements relating to the development of a performing arts facility on a portion of the east bank stadium campus.
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WHEREAS, the Metropolitan Government is the fee owner of that certain parcel of property identified on Exhibit A (the “Land”), located within the broader campus (the “Campus”) surrounding the East Bank stadium now under construction (the “Stadium”); and
WHEREAS, pursuant to Resolution RS2024-270, adopted on April 16, 2024, the Metropolitan Council approved a non-binding Memorandum of Understanding with the Tennessee Performing Arts Center Management Corporation, a Tennessee non-profit corporation (“TPAC”) regarding the development of a performing arts facility (the “Performing Arts Facility”) on the Land; and
WHEREAS, the Metropolitan Council now wishes to approve the forms of a Development Agreement and Lease Agreement, each between the Metropolitan Government and TPAC, to provide for the development, use and operation of the Performing Arts Facility and the infrastructure improvements related thereto; and
WHEREAS, the Metropolitan Government is party to that certain First Amended and Restated Site Coordination Agreement, dated November 13, 2024 (the “Site Coordination Agreement”) with Tennessee Stadium Company, LLC (“StadCo”), which agreement requires the Metropolitan Government and TPAC, prior to the development of the Performing Arts Facility on the Land, to execute and deliver a campus operations and use agreement providing for the rights and responsibilities of StadCo, as the tenant of the Stadium, and the Metropolitan Government and TPAC, as the owner and tenant of the Performing Arts Facility; and
WHEREAS, on December 3, 2025, a community meeting was conducted at the existing TPAC facilities, regarding the proposed TPAC development agreement and lease, as required by Metropolitan Code of Laws § 2.24.230; and
WHEREAS, the Metropolitan Council has been provided with a copy of an appraisal of the value of the Land, as required by Metropolitan Code of Laws § 2.24.225.
NOW, THEREFORE, BE IT ENACTED BY THE METROPOLITAN COUNTY COUNCIL OF THE METROPOLITAN GOVERNMENT OF NASHVILLE AND DAVIDSON COUNTY:
The form, terms and provisions of the Development Agreement between the Metropolitan Government and TPAC attached hereto as Exhibit B (the “Development Agreement”) are hereby approved, and the Metropolitan Mayor, Metropolitan Clerk, and Director of Law of the Metropolitan Government are hereby authorized, empowered and directed to execute and deliver the Development Agreement in the name and on behalf of the Metropolitan Government in substantially the form attached hereto as Exhibit B, with such changes and additions thereto and omissions therefrom as the Metropolitan Mayor shall approve as necessary or appropriate, such execution and delivery to be conclusive evidence of such approval; provided that such changes, additions and omissions do not have any material adverse effect on the terms of the Development Agreement attached hereto as Exhibit B. From and after the execution and delivery of the Development Agreement, the Metropolitan Mayor and such employees of the Metropolitan Government as he or she may designate from time to time, or any of them, are hereby authorized, empowered and directed to do all such acts and things and to execute all such documents as may be necessary to carry out and comply with the provisions of the Development Agreement as so executed, including without limitation providing any and all approvals, consents and waivers required thereby, and entering into such amendments thereto that do not have any material adverse effect on the terms of the Development Agreement attached hereto as Exhibit B.
The form, terms and provisions of the Lease Agreement between the Metropolitan Government and TPAC attached hereto as Exhibit C (the “Lease Agreement”) are hereby approved, and the Metropolitan Mayor, Metropolitan Clerk, and Director of Law of the Metropolitan Government are hereby authorized, empowered and directed to execute and deliver the Lease Agreement in the name and on behalf of the Metropolitan Government in substantially the form attached hereto as Exhibit C, with such changes and additions thereto and omissions therefrom as the Metropolitan Mayor shall approve as necessary or appropriate, such execution and delivery to be conclusive evidence of such approval; provided that such changes, additions and omissions do not have any material adverse effect on the terms of the Lease Agreement attached hereto as Exhibit C. From and after the execution and delivery of the Lease Agreement, the Metropolitan Mayor and such employees of the Metropolitan Government as he or she may designate from time to time, or any of them, are hereby authorized, empowered and directed to do all such acts and things and to execute all such documents as may be necessary to carry out and comply with the provisions of the Lease Agreement as so executed, including without limitation providing any and all approvals, consents and waivers required thereby, and entering into such amendments thereto that do not have any material adverse effect on the terms of the form of Lease Agreement attached hereto as Exhibit C.
The form, terms and provisions of the Campus Operations and Use Agreement attached hereto as Exhibit D (the “Campus Operations Agreement”) are hereby approved, and the Metropolitan Mayor, Metropolitan Clerk, and Director of Law of the Metropolitan Government are hereby authorized, empowered and directed to execute and deliver the Campus Operations Agreement in the name and on behalf of the Metropolitan Government in substantially the form attached hereto as Exhibit D, with such changes and additions thereto and omissions therefrom as the Metropolitan Mayor shall approve as necessary or appropriate, such execution and delivery to be conclusive evidence of such approval; provided that such changes, additions and omissions do not have any material adverse effect on the terms of the Campus Operations Agreement attached hereto as Exhibit D. From and after the execution and delivery of the Campus Operations Agreement, the Metropolitan Mayor and such employees of the Metropolitan Government as he or she may designate from time to time, or any of them, are hereby authorized, empowered and directed to do all such acts and things and to execute all such documents as may be necessary to carry out and comply with the provisions of the Campus Operations Agreement as so executed, including without limitation providing any and all approvals, consents and waivers required thereby, and entering into such amendments thereto that do not have any material adverse effect on the terms of the Campus Operations Agreement attached hereto as Exhibit D.
All acts and doings of the Metropolitan Mayor, Metropolitan Clerk, Director of Finance, Director of Law and any other officer of the Metropolitan Government which are in conformity with the purposes and intent of this Ordinance shall be, and the same hereby are in all respects, approved and confirmed as may be necessary or appropriate in order for the Metropolitan Government to comply with the terms of the documents and agreements contemplated herein, including but not limited to the Development Agreement, the Lease Agreement and the Campus Operations Agreement.
This Ordinance and any of the documents approved by this Ordinance may be amended by resolution adopted by the Metropolitan Council receiving a majority of the votes to which the Metropolitan Council is entitled.
All ordinances in conflict or inconsistent herewith are hereby repealed insofar as any conflict or inconsistency exists.
This Ordinance shall take effect from and after its adoption, the welfare of the Metropolitan Government requiring it.
Agenda Analysis
Analysis
This ordinance, as amended, authorizes the Metropolitan Government (“Metro”) to execute and deliver a Development Agreement and Ground Lease agreement with the Tennessee Performing Arts Center Management Corporation (“TPAC”), a Campus Operations and Use Agreement, and other documents and agreements relating to the development of a performing arts facility on a portion of the East Bank stadium campus.
Pursuant to Resolution No. RS2024-270, a non-binding Memorandum of Understanding was approved between TPAC and Metro relative to the development of a performing arts center on the East Bank. A community meeting was conducted at the existing TPAC facility about the proposed development agreement and lease as required by Metropolitan Code of Laws section 2.24.230.
Metro is a party to the 2024 Site Coordination Agreement with Tennessee Stadium, Company, LLC (“StadCo”) which requires Metro to execute and deliver a campus operations and use agreement providing for the rights and responsibilities of StadCo, Metro, and TPAC regarding the use of the shared campus areas.
This ordinance and its related documents may be amended by a resolution of the Metropolitan Council receiving 21 affirmative votes.
The Development Agreement
Exhibit B to the Ordinance
Metro and TPAC would execute a Development Agreement with respect to the terms, conditions and provisions with which the performing arts center (“Project”) will be financed, designed, developed, and constructed. The term of the agreement shall begin the date the agreement is executed and expire on the date of project completion. TPAC shall be responsible for all costs, including cost overruns, associated with the design, development, and construction of the Project, with limited exceptions for Metro defaults, breach, negligence, and cost associated with audits requested by Metro. The parties expressly agree that Metro shall not be responsible for the payment of any cost overruns.
Several financing milestones must be present for construction on the project to begin. TPAC must obtain $500,000,000 in state funding, $100,000,000 in donor contributions, and debt financing by TPAC from one or more sources. If TPAC fails to meet these financing milestones by December 31, 2026, and if the date is not extended by force majeure or delay from another party, Metro will have the right to terminate the agreement, and TPAC will have the right to abandon construction, which would also terminate the agreement.
During this period, TPAC must also deliver a concept plan for the Project that has been approved by the Metropolitan Planning Department, enter into a Construction Manager at Risk Agreement, and deliver a preliminary Project budget and improvements construction schedule. As amended, Metro must also take all steps necessary to arrange for the design, funding, and construction of improvements to provide for a 25-foot-wide path of ingress and egress to be fully accessible to the Project’s loading dock.
Regarding infrastructure improvements, TPAC will be responsible for design and construction from Victory Avenue from the intersection of existing South 1st Street to the intersection of the future Davidson Street. This includes the design and construction of the “Cumberland Walk” public open space and the design and structure of potable water, storm sewer, underground electrical, and gas utilities. TPAC is also responsible for the design and construction of an extension of Davidson Street from Victory Avenue along the entire property frontage. This includes the design and structure of potable water, storm sewer, underground electrical, and gas utilities. TPAC will also be provided connection points for electrical and sanitary sewer service, for which they will be responsible for service connection.
Metro will be responsible for the relocation of existing Piedmont Gas infrastructure onto the public right-of-way, the design and construction of Victory Avenue from the intersection of South 1st Steet to South 2nd Street, with the design and construction of potable water, storm sewer, underground electrical, and gas utilities; construction of sanitary sewer main, construction of NES duct bank, future modifications to the John Seigenthaler Pedestrian Bridge, and improvements to Davidson Street west of TPAC. Metro will also provide a district-wide stormwater solution to meet Metro Water Service quality and prepare the parcel, which includes abandoning existing easements and preparing a boundary survey and plat recording.
TPAC agrees to provide access to all external stairwells to the John Seigenthaler Pedestrian Bridge as well as the project site for purposes of staging construction of modifications to the pedestrian bridge and any other activities in connection with construction of the pedestrian bridge.
TPAC will be responsible for engaging the Construction Manager at Risk, Architect and engineering teams and will provide Metro with information regarding the names of key representatives. TPAC will be responsible for ensuring the construction manager agreement includes, among other things, liquidated damages for failure to meet the project’s substantial completion deadline; a one-year warranty against defects in workmanship and materials; an assignment to Metro to enforce the warranty; and a guaranteed maximum fixed price for the work. Metro may retain a construction representative to assist Metro with questions or issues related to the Project work.
Before and during the construction period, TPAC shall maintain the types of amounts of insurance as maintained by a reasonable and prudent developer. When the building is substantially complete, TPAC shall maintain insurance as provided in the ground lease. TPAC shall indemnify and hold harmless Metro for any third-party claim arising out of any demolition, construction, use, occupancy, or operation related to the Project, any claim for losses connection to TPAC’s violation of applicable laws, liens against Metro because of TPAC’s Project work, grossly negligent or willful acts or omissions by TPAC, or environmental events that TPAC must cover through remedial efforts.
The Ground Lease
Exhibit C to the Ordinance
Metro and TPAC would execute a ground lease for the Project site The initial term of the agreement will begin upon the commencement date and continue for 35 years. TPAC will possess two separate options to extend the term of the agreement for 30 years each. Such options shall be exercised only with one to two years’ written notice to Metro.
The lease allows TPAC to possess, use, and operate the premises at the Project site, hold events at the premises, and retain all revenues from these uses. TPAC would agree to maintain and improve the performing arts center, use the facility as its primary performance venue, and make commercially reasonable efforts to use local vendors, goods, and labor in operating the performing arts center.
Rent during this period shall be $100 annually, along with all operating expenses and construction, demolition, maintenance, utility and repair costs for the facility. TPAC agrees to be solely responsible for all operating expenses in connection with the management, operation, repair, replacement and maintenance of the Project, except for compensation paid to Metro employees, security services incurred by TPAC in connection with Metro events, other expenses which Metro or another party is responsible for payment or reimbursement.
TPAC must construct the Project in accordance with the Development Agreement and maintain the Project site at its sole cost and expense. TPAC will have the right to make capital improvements on the Project site at its own discretion, unless the cost of such improvements is more than $10,000,000, would violate applicable laws, or materially affect the capacity or function of the performing arts center.
TPAC shall make an annual infrastructure contribution of $400,000 to Metro over a 15-year period in consideration of Metro’s commitment to build public infrastructure to the benefit of TPAC. Metro will also make Metro-owned campus parking spaces available to TPAC pursuant to protocols established by the parties. TPAC can reserve spaces for its patrons upon advance notice and prepayment. Metro will use commercially reasonable efforts to satisfy TPAC’s requests. TPAC’s use of parking spaces is subject to StadCo’s prior right to use campus parking spaces as shown in a separate parking agreement.
Per the agreement, TPAC shall be entitled to general revenues gained from the lease. Metro shall further grant TPAC the rights to sell naming rights to the performing arts center, along with broadcast rights, and advertising rights.
Metro reserves and retains a nonexclusive right and license for all access, ingress and egress over all external staircases that connect and provide access from the John Seigenthaler Pedestrian Bridge to the Project Site. Metro reserves a similar right to access the TPAC site for construction at and around the John Siegenthaler Pedestrian Bridge.
Neither TPAC nor Metro shall allow any hazardous substance that would damage the facility or injure or endanger the life of any person at the facility, unless such hazardous substances are necessary to use the facility and kept, used, disposed, and transported in compliance with applicable law. TPAC shall hold Metro harmless for all damages arising from a breach of this section of the agreement.
Per the agreement, Metro and its governmental or nonprofit designees shall have free use of the performing arts center and the premises for education and civic-oriented events. TPAC shall have no obligation to permit more than 30 Metro events in an aggregate of 30 calendar days in a year.
TPAC shall procure and maintain insurance on the performing arts center against loss or damage by fire and such other hazards, casualties, risks and contingencies in an amount at least equal to the full replacement cost of the performing arts center and other improvements without deduction for physical depreciation. TPAC shall also maintain commercial general liability insurance for an amount lot less than $10,000,000 per occurrence and in the aggregate not less than $10,000,000 for personal injury liability. Other required insurances include employer liability insurance with a $5,000,000 policy limit and commercial automobile liability insurance of not less than $10,000,000. Metro shall separately procure and maintain commercial general liability insurance and workers’ compensation insurance on a per event basis for Metro employees and for each Metro event.
TPAC shall indemnify and hold harmless Metro against and from any and all losses that may be imposed upon any liability which may be asserted against Metro or any failure by TPAC to perform its obligations under this lease.
If the Project Site is damaged or destroyed or otherwise is in a condition such that it does not meet the Operating Standard as a result of fire, explosion, earthquake, act of God, act of terrorism, civil commotion, flood, or any other casualty, then TPAC shall remediate any hazard and restore the facility to a safe condition.
Campus Operations Agreement
Exhibit D to the Ordinance
The Campus Operations and Use Agreement is an agreement by and among Metro, TPAC, and StadCo, to primarily define the relationships among the parties as it relates to the Project Site within the East Bank Campus. The term will be effective upon execution and continue as long as the Stadium Lease and either the TPAC Development Agreement or TPAC Ground Lease remains in effect. The parties agree that the TPAC Site shall not be subject to the site coordination agreement, as amended.
A TPAC representative will be invited to attend meetings of a Campus Coordination Committee, created pursuant to the 2024 Site Coordination Agreement, which will keep the parties informed regarding the Campus, and participate as an ex officio member. The agreement provides for data rights, commercial rights, rights to digital experiences and assets, and advertising limitations within the Project Site and Campus. TPAC, Metro and StadCo agree to negotiate in good faith to solicit and engage with a naming or similar sponsors of the Campus, excluding the stadium, the Second Street Plaza, and the Project Site, to collectively maximize revenue for TPAC, Metro, and StadCo. Neither TPAC nor Metro shall authorize any sports betting or casinos throughout the TPAC Site without StadCo’s prior written approval.
Fiscal Note: Tennessee Performing Arts Center Management Corporation (TPAC”) will pay Metro a base rent in the amount of $100 per year from the commencement date of the lease agreement through the terms of the lease for 35 years. TPAC will pay for capital improvement costs, operating expenses, maintenance and repairs. TPAC will contribute an annual infrastructure contribution of $400,000 over a 15-year period for Metro’s commitment to construct public infrastructure.