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Fifth + Broadway: How Northwood Investors closed one of the nation’s largest deals of the year

December 6, 2022

When Northwood Investors snagged Fifth + Broadway for $787 million in November, capital markets had been shutting down for months, and many investors had paused activity as interest rates soared. Still, the company managed to close the deal, which marked the country’s fourth largest real estate transaction this year — and the only one to close in the fourth quarter. We caught up with Ward Kampf, president of Northwood’s retail division, to learn more about the deal, its financing and why he thinks Fifth + Broadway is one of the best mixed-use assets in the nation.

Ward Kampf, president of Northwood Investors’ retail division, says Fifth + Broadway is one of the nation’s top mixed-use assets.

How did you find the Fifth +Broadway deal, and what was its selling point?

The deal was being marketed. We love mixed-use because we kind of think mixed use is its own asset class. We love Nashville. We were working on the Conrad [Nashville hotel] this summer, and we closed that. We’re familiar with the city because of the other assets we own in town.

John Kukral, our CEO, saw Fifth + Broadway, we talked about it, and I just said, “I think it’s a world-class asset.” We truly think this is one of the top five mixed-use assets in the country. What’s really important is that the retail is phenomenal, along with food and beverage. I think the residential is some of the best on the market. And then the office kind of speaks for itself, with Alliance Bernstein and the office tenants that this asset’s been able to attract.

What questions did your lender have for you, and what ultimately sold them on financing this project?

I think it’s a market they believed in strongly. First of all, you gotta believe in us, right? We have vertical platforms. We have a residential platform; we have an office platform and I run the retail platform. So, if we weren’t a qualified operator and we didn’t have the operational expertise, I think there would’ve been absolutely no way to go capitalize this deal. Northwood has an incredible track record in investing. The fact that we were so invested in the market i think really gave the lender some comfortability. We were one of the early people to go to Charlotte back in 2010, and we’ve been in this market since 2011 — so I think it’s the fact that we’re able to identify these markets early, and then we just watch them.

Northwood has spent over $1 billion in Nashville over the last few years. How has that portfolio performed compared to those in other markets?

It’s been one of the best markets we’ve invested in. And listen, we’re in L.A., we’re in San Diego, we’re in Austin. But Nashville’s different: You have a very pro-business set of leaders. I was just on the phone with somebody from New York, and we were just having this conversation about taxation and all the barriers and everything that’s happening in New York. Nashville is a city with very good tax policy, very pro-business tax policy.

What’s the most valuable part of Fifth + Broadway?

The retail and the food and beverage, whether it’s what Sam Fox has done with Twelve Thirty Club or Pushing Daisies, and then the food hall has been second to none. The whole thing, the aesthetics from the parking garage to the retail, to the walkability to the connectivity. Like I said, I think it’s one of the top five. It’s an important catalyst for what happens with the rest of Broadway, the rest of downtown, the rest of the city.

Lower Broadway can get rowdy. Has that ever been a discussion at Northwood?

I mean, we read the articles. I think the city has taken the appropriate approach — they’ve got an eye on it. They’re not just going to let this linger. I think all this happens so fast. Growth is good and bad when it’s explosive like it is. I mean, it’s the same thing in Austin; on the weekends, it’s insane down there. A lot of these cities go through these growing pains. One thing we think about is safety. That’s top of mind for us. For a family or a couple with a young kid, we want it to be a place that’s safe.