The Department of General Services has requested a waiver to speed up the process of choosing a master developer for state-owned land near the Tennessee Capitol.

The department wants to put out a request for qualifications to find a master developer for 10 acres of parking lots surrounding the State Capitol.

The goal is to turn the lots into a mixed-use development with housing, hotel, retail and parking for state employees. The lots up for redevelopment include the one on which Elon Musk’s Boring Company is building the first phase of its underground tunnel for Tesla vehicles.

Michelle Parks, a spokesperson for the Department of General Services, said the waiver does not make any part of the bid process private.

For public-private partnerships, the department must submit plans during the budget cycle, which the state legislature typically approves in April each year.

“The Department of General Services did not anticipate pursuing this procurement during the last budget cycle, so it was not included,” Parks said. “ The State Building Commission has the authority to waive that disclosure requirement, which allows us to move forward with the Request for Qualifications rather than waiting until the next budget cycle. The procurement will be openly advertised and competitive.”

The department’s request came before the Tennessee State Building Commission Thursday, where the board deadlocked 3-3 on a vote to approve the request-for-qualification and the disclosure waiver. Instead, the commissioners agreed to meet in two weeks to vote on General Services’ proposal, after concerns expressed by State Sen. Heidi Campbell, a Nashville Democrat, during public comment on the project.

Campbell, who is not on the building commission, said she favored the state redeveloping the parking lots into a mixed-use project, but was concerned the Department of General Services was trying to steer the project to a single bidder without a competitive process.

“The department certainly sounds like they already have someone they want to pick,” Campbell said. “It seems like they’re trying to rush this before the end of Gov. Bill Lee’s term.”

Lee is term-limited, with his final day in office coming in January 2027.

The redevelopment of the state lots is part of a broader plan by state officials started in 2022 to offload or redevelop some of the state’s downtown Nashville real estate holdings.

The Department of General Services submitted a request for information in September 2025 on the “feasibility of a private developer” building on those state parking lots.

As part of its request for qualifications process, whoever builds on the state lots will also receive an option to expand its development to the James K. Polk Building, which currently is home to the Tennessee Performing Arts Center, TPAC.

TPAC has already announced a plan to move to Nashville’s East Bank, near the new NFL stadium currently under construction.

Adam Kleinheider, the spokesperson for Republican Lt. Gov. Randy McNally, said McNally voted against approving the request for qualifications Thursday because he had additional questions and concerns.

“The request for qualifications was not in its final form until the morning of the meeting,” Kleinheider said.

Deborah Fisher, executive director of the Tennessee Coalition for Open Government, said she still didn’t understand why approving the project couldn’t go through its normal disclosure process.

“The legislative session starts in four months,” Fisher said. “That review step by lawmakers during the budget process is a healthy step. Less scrutiny from lawmakers means less scrutiny from the public.” 

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