Town on a tear to become the best in America

via Dan Orlando/ Real Estate Weekly

Jersey City, an area that has spent the 2000s embracing the nuances of gentrification along its waterfront, is now anticipating the completion of several dynamic-changing buildings within an interior that, according to the city’s division of planning, is “in need of rehabilitation.”

To follow in the footsteps of Hoboken, its neighbor to the north, Jersey City has lined up multiple projects to add luster to the location as a whole and up the value of properties within the state’s second-largest municipality.

It’s an initiative that has Mayor Steven Fulop at the forefront. “We’re correcting decades of perception issues,” Fulop told Real Estate Weekly. “Of corruption, of mayors going to jail, of legal issues, of asymmetrical development. Perception generally lags reality.

“We started with a tax-abatement plan to really encourage development away from the waterfront,” said Fulop, adding that the measure was “very, very aggressive,” but necessary due to the negative preconceptions of the area.

The abatement is a 30-year tax break for developers that opt to invest in the city’s inner wards. While some investors may be wary, initial coaxing has begun to produce positive results.

Rendering of KRE Group's Journal Squared

Rendering of KRE Group’s Journal Squared

In June on this year, Kushner Real Estate Group opened 18 Park, a 422-unit luxury rental building that has already seen more than 250 apartments claimed. Aside from upscale living options, 18 Park also gives the area 10,500 s/f of retail space as well as placing 34,000 s/f of classrooms and recreational spaces at the Boys & Girls of Hudson County’s disposal.

“We continue to see an increase in demand from residents for new living options both on the waterfront and in in-town neighborhoods. This is fueled in part by the continued increase in living costs in Manhattan and Brooklyn which is pushing people to consider other outer borough locations, and Jersey City has become an extension of that,ˮ said Jonathan Kushner, president of KRE Group.

According to Kushner, more and more people are accepting Jersey City today as a viable, dynamic destination in its own right. He said, “The area always offered one of the most convenient and comprehensive public transportation systems with multiple PATH stations and ferry terminals offering quick service into Manhattan, as well as spectacular views of Manhattan, which has long attracted Manhattan professionals to the city’s waterfront high-rises.

“In recent years, that appeal has expanded inward into in-town neighborhoods with new, forward-thinking, highly-amenitized residential buildings and a new breed of supportive lifestyle attractions and services, like a branch of the popular Williamsburg arcade-bar, Barcade, farm-to-table restaurants, boutique storefronts, and an ever-growing arts scene.ˮ

In 2010, KRE, along with Ironstate Development Company, developed 225 Grand, a 15-story rental building with 348 apartments near the Marin Boulevard Light Rail Station. After leasing every apartment within 10 months, Kushner said the company was inspired to break ground on its sister building, 18 Park. Just up the road, the partners will also develop 235 Grand, which will have more than 600 rentals.

“We’re extremely confident in the future of Journal Square, which offers its own mass transportation hub and is targeted for the next wave of off-the-waterfront development,ˮ said Kushner, whose firm is also developing Journal Squared directly adjacent to the Journal Square Transportation Center.

That fully entitled project will feature 2.4 million square feet of mixed-use multifamily housing and retail development. When complete, it will have three high rise towers of 54, 70, and 60 stories, with 1,840 rental apartments, 36,000 s/f of retail space, and 920 parking spaces.

It will include a plaza that will draw foot traffic, provide a “kiss-and-rideˮ for commuters and provide easy access to the PATH train.

Work is underway for Phase I, which includes the 54-story tower, the pedestrian plaza, and the majority of site work required for the three phases. The first tower will house 540 rental apartments, 139 interior parking spaces, 72 surface parking spaces, and 20,000 s/f of indoor and outdoor amenity space and should be finished by mid-2016.

The effort to transform Journal Square has inspired some unusual joint venture partnerships, too.

Earlier this month, Jersey City Planning Board green-lit the 21-story McGinley Square, a partnership between Maryland-based Sora Development and the local St. Peter’s University.

“This is a clear sign from everyone’s perspective that development is now moving off of the waterfront, away from the Hudson River and inland to an area of the city that mightily needs it,” said Eugene Paolino a partner at Genova Burns Giantomasi Webster who represented St. Peter’s in the sale. “That’s a good sign.”

massive apartment projects, including the tallest residential tower in the state.

In January, Mack-Cali, in partnership with Ironstate Development, began construction on a 69-story apartment tower catering to hip urbanites and featuring “micro-unitsˮ for single professionals. It is the REIT’s eighth apartment project in Jersey this past year.

FULL ARTICLE

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