Congratulations on your promotion! This is a great thing, and even though it is coming with a tinge of worry.
The gentleman in your team is going to have some things going on that are in your sphere of control, and a lot that are outside of it. He’s going to have his own emotions, feeling, and thoughts about what has happened- and why.
1) Give it time. He’s got to process his feelings and your relationship may not be perfect from day one. Give the two of you time to deal with it all.
2) Don’t put your feelings on to him. It is possible that he’s fine about it, and just because you would feel rubbish, doesn’t mean he is feeling that way. Don’t make a problem in your mind before it really manifests- it really could all be fine. It is kind to try and put yourself in his shoes, but the way to do that is ask him if you can help, not to force your own mentality onto him.
3) Focus on the job at hand. Even if you’re normally besties, keeping things a bit more formal and structured for a while, within the boundaries of what needs doing in the job, keeps everyone focused- and not on those pesky emotions. Show up to 1:1s knowing what you want to talk about, and make sure your team meetings have a clear set up, so there’s less room for awkwardness.
4) Talk about his career goals. When the time is right, and probably at a career check-in or development review; talk to hum about his career goals. Be encouraging, supportive, and open about the fact you’re aware he had the ambition to apply for your job. The only way you can really mess up that meeting is to break his trust, so let him know you’re a safe space and you’re not here to point fingers or laugh at him behind his back.
5) Kill with kindness. There’s clearly a world in which he gets upset, but if that happens, you know how to be a human. Just remember, it is not your job to deal with people being mean to you. If in doubt, kill with kindness.
Wishing you the best of luck with the lead role!