Challenges at Phase I of the Rolling Mill Hill Development, which encompassed the remodeling of the Victorian and the Art Deco structures of the old hospital on top of the hill, began when the recession hit in 2008.

 

By that time Direct Development had already erected a third, freestanding condominium building called the Metro. However, Direct Development cancelled plans for a fourth condominium structure in 2008 and eventually backed out of the deal entirely. The remaining development was then handled by an investor group called RMH Development 1 LLC, also out of Wisconsin. In 2009, RMH could not pay a construction loan of $21.4 million, which had been negotiated down from $42.8 million. Eventually Bank of America and other lenders filed a lawsuit and the development went into receivership (see Nashville Business Journal, 2009).

 

General contractor of the project, Walker Mathews, president of R.C. Mathews, said the Rolling Mill Hill development problems began because Direct was undercapitalized. It did not have enough money to pay for expenses, even after the work on the three existing buildings was completed (see Nashville Business Journal, 2009).

 

As a result 72 units stood empty for many months, but in 2010 Atlanta-based Chartwell Real Estate Partners purchased the property for a little over $7 million and turned them into rental units (see Nashville Post, 2010).

 

From the get-go every development proposal in Rolling Mill Hill had difficulties making the numbers work. However, the Mathews Company received historical credits for the barn structures, which helped put the deal together. The trolley barns were not considered a necessity in the original development plans by RTKL. However, they were saved after the public made it clear they wanted them preserved.