With rents in Manhattan expected to increase 7 percent in 2012, it is no surprise that many apartment seekers are looking to the outer boroughs and New Jersey as a refuge. Queens, Brooklyn and Hoboken are well-known hot spots for young professionals looking for a better bang for their buck when it comes down to both space and amenities. Get ready to add Jersey City to that list.
The state’s second largest city sits just over the Hudson River from Lower Manhattan. It has been quickly overcoming its stigma of urban decline thanks to the availability of underdeveloped waterfront land. The industrial businesses that vacated from the 1950s through 1970s left behind a plethora of vacant rail yards and factories, space that allowed for a full-on urban renaissance that began in the 1980s and is still moving at full steam today. This is perhaps most visible in the success of the Exchange Place financial district, colloquially called “Wall Street West,” which experienced a rapid construction of high-rise office buildings—assets that are now occupied by the likes of Goldman Sachs, UBS and Merrill Lynch. Add in a light rail system that debuted in 2000 and now offers seamless access to Manhattan-bound PATH trains and you have an area primed for extremely successful transit-oriented development.
A quintessential example of the materialized Liberty Harbor redevelopment plan is HLW’s 225 Grand. It is currently the largest single residential property in the new neighborhood. The 348-unit community consists of a 15-story concrete tower with a glass and brick façade and a lower five-story wrap built from lightweight steel that includes a small retail portion and internalized parking. The luxury rental comes complete with a full host of amenities including a doorman, fitness center, billiards room, lounge, business center and a roof deck pool on top of the lower portion. Edward Shim, a senior designer at HLW who worked on 225 Grand from the start, says that a well thought-out amenity package is especially important in Jersey City.
“Unlike New York, where all of the amenities are available down the block, Jersey City currently lacks that support,” Shim says. “As a result, the developers are trying everything they can to provide those amenities with the asset.”
The fully leased property has eliminated concessions and enjoys rents that continue to grow, performance markers that demonstrate the overall strength of the market, says Joshua Wuestneck, senior vice president of development at Ironstate Development Co.
“We are extremely bullish on the rental housing market in Jersey City and in the shadow of Manhattan in general,” Wuestneck says.
The success at 225 Grand serves as a launching point for the partnership’s next two developments in Liberty Harbor, the first being 18 Park, a 422-unit building located two blocks to the south. Construction will commence in 2012, allowing for a slated occupancy by fall 2013. The property will include a custom-designed facility that will serve as the new home for the Boys and Girls Club that is currently located on the site of Ironstate and Kushner Real Estate Group’s third, and largest, project in Liberty Harbor.
“The whole plan kind of came together organically with the Boys and Girls Club, which needed an injection of capital into their organization,” says Wuestneck. “It also allows the club to remain in the same area, which was important for them. It has certainly been a win-win situation for everyone.”
The project, which for now is called Block 5, will entail a 45-story podium rental tower where the Boys and Girls Club (currently located in a repurposed coal bunker) now sits. The site, which will also house a 10-story rental structure, will total approximately 670 units when completed. The asset will also have the distinction of serving as a welcoming gateway for Liberty Harbor from the historical districts to the north thanks to some clever tweaks to the street grid. The plan calls for an extension of Grove Street, which terminates at the Boys and Girls Club, and the revitalization of an adjacent underutilized park.