As 515 Walnut nears its maximum height, the development firm that initially planned the 33-story downtown Des Moines apartment tower is being sued for $33 million in unpaid loans.
Peoples Bank filed a petition in Polk County District Court against Blackbird Investments LLC and the firm’s president, Justin Doyle, seeking payment on a loan associated with 515 Walnut, according to court records filed May 22. The commercial loan, made in 2020, amounted to $30.5 million, according to the loan note.
Blackbird missed its construction deadline, which resulted in the city of Des Moines canceling a development agreement.
Peoples Bank alleges Blackbird and Doyle violated the terms of the loan by failing to pay it off by Sept. 25, 2025.
After applying payments, Blackbird still owed $24.4 million to the Clive-based bank, according to the court filing. Late fees, interest and attorney costs added another $8.7 million, bringing the total claim to roughly $33 million.
The court was unable to serve Doyle and the now-inactive LLC, which filed for dissolution in August, according to the Iowa Secretary of State’s Office. Doyle could not be reached for comment.
Peoples Bank had no further comment on the lawsuit, its attorney, John Moorlach, said Monday, June 22.
What happened with Blackbird’s plans for 515 Walnut?
Blackbird Investments announced the plan for 515 Walnut in 2016. The eastern half of the Kaleidoscope at the Hub shopping mall, which occupied the site, was emptied of tenants in 2018 ahead of planned demolition to make way for the project. The tower was set for completion in 2021.
But construction languished as Blackbird became embroiled in lawsuits alleging it failed to make payments on loans for other developments. After the company fell behind on the project’s schedule, the city of Des Moines in June 2020 terminated the development agreement, which included $5.6 million in tax increment financing rebates and a 10-year tax abatement.
Doyle in a 2021 statement to the Des Moines Register blamed the delays on the COVID-19 pandemic. In a previous interview, he said the uncertainty caused by shutdowns that emptied downtown offices had “thrown things for a bit of a loop.”
The cancellation of the project at the northwest corner of Fifth Avenue and Walnut Street came about the same time as another major project, on the southeast corner, also fell through. Lengthy litigation over that project, known as The Fifth, brought an Iowa Supreme Court ruling on June 12 that found the city owed the developer $5.9 million.
While that site remains empty except for a parking garage now owned by the city, 515 Walnut began rising after Joe Teeling, a developer who briefly served as president of Blackbird before severing ties with the firm, purchased the plans for the tower in 2022. As president of St. Joseph Group, Teeling broke ground on the nearly $150 million tower in February 2025.
Despite a temporary pause in October because of financing delays, construction is on schedule and 515 Walnut is expected to reach its maximum height of 347 feet by the end of June, Teeling told the Register.
Kate Kealey is the growth and development reporter for the Register. Reach her at kkealey@registermedia.com or follow her on X at @Kkealey17.
This article originally appeared on Des Moines Register: Suit seeks $33 million loan repayment from former 515 Walnut developer
Reporting by Kate Kealey, Des Moines Register / Des Moines Register
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By Kate Kealey, Des Moines Register | USA TODAY Network
