Jones Lang LaSalle
All eyes are on Newark's new apartments
Thursday, June 15, 2006
BY JEFFERY C. MAYS The Lefcourt Building has long been a prominent fixture of Newark's skyline, but after falling on hard times, it lay vacant for 20 years.
More than 300 ironworkers, carpenters, laborers and electricians just completed a renovation, transforming the 35-story office building into 317 market-rate apartments. The $110 million makeover marks the first unsubsidized rental units downtown since the Colonnade Apartments were built in 1960.
Arthur Stern, chief executive of Cogswell Realty, the project's developer, said both his company and the city have much riding on the restoration of 1180 Raymond Blvd.
"This is the building that will be a catalyst for everyone else," Stern, wearing a white construction hat, said during a recent tour of the project. "It was an eyesore on the Newark skyline. This time next year, 500 people will be living downtown. This is what Newark needs."
For all the talk about Newark being the next Jersey City or Hobo ken, there still aren't enough people living downtown. In a city of 280,000, there are only 619 households -- slightly more than 1,700 people -- in the census tract that contains 1180 Raymond Blvd.
Despite the success of the New Jersey Performing Arts Center and the development of an arena for the Devils hockey team, residential projects have been slow to develop in downtown Newark. NJPAC re cently announced plans for a residential tower, but most of the construction over the past few years has been two- and three-family homes built on vacant lots.
Newark was second in the state last year with 2,064 residential building permits issued, compared with Jersey City's 3,194, but only 168 of Newark's permits were for structures with five or more units, according to city records. Jersey City, meanwhile, issued 2,329 permits for buildings with five or more units. The value of Newark's permits for five or more units was $3.9 million, while the value of Jersey City's permits in that category was $209 million.
BOOM OR BUST
Still, commercial real estate ex perts say if 1180 Raymond Blvd. succeeds, it could jump-start a downtown residential building boom in the state's largest city. Conversely, if the 317 apartments don't fill fairly quickly, residential developers could be scared away for years to come.
"Developers look at other projects, and so do banks and investors," said Carl Dranoff of Dranoff Properties, which has completed major housing development projects in Philadelphia and along the Camden waterfront. "A success (with 1180 Raymond Blvd.) cer tainly would be a great benchmark for future projects. A sluggish project could discourage future investment and would have a pretty immediate impact on financial institutions."
A couple of downtown market- rate residential projects are already on the drawing board, including a controversial Mulberry Street project that would see 2,000 condominiums rise near the federal courthouse over the next several years. A few blocks away from 1180 Ray mond Blvd. are two other Cogswell restoration projects, the Hahne & Co. Building and the Griffith Building.
With ongoing concerns about suburban sprawl and growing interest from city officials in expanding Newark's population, the tim ing might be right for a boom in rental housing downtown, said Stephanie Bush-Baskette, director of the Joseph C. Cornwall Center for Metropolitan Studies at Rutgers University-Newark.
"For the last several years, it's been about people living in the city and wanting a nice place to live and the convenience of mass transit," she said. City dwellers "want to walk to cultural events. Many people who work in Newark can afford it. This may be an option instead of getting on the train."
The Lefcourt Building, also known as the Raymond Commerce Building, was designed by prolific Newark architect Frank Grad and completed in 1929. A New York developer named Abraham Lefcourt intended to use the building, but went bankrupt in the stock market crash of 1929, according to historic preservation consultant Ulana Za kalak.
The tan Art Deco building is an important part of Newark's Four Corners historic district and is noted for its "distinctive and ex traordinary ornamental work," including terra cotta panels and metal ornamentation along the five-story base, said Glen Leiner, executive director of the Art Deco Society of New York.
Cogswell Realty acquired the building in 1999 from the Helmsley Group. Stern at first sought to re make the building into student housing, but those plans failed. Cogswell then spent a year on redesign plans and the next four trying to finance the project. The city of Newark was the only major entity that lent support, providing some financial commitments.
"The typical response from lenders was, 'That's a great project. We wish you the best of luck. Call us on the second one,'" Stern said.
ITS OWN MONEY
While waiting for financing, Cogswell used $18 million of its own capital to start construction. "Our feeling was if we don't start this thing, no one will believe it was happening," Stern said.
The gamble paid off. Cogswell eventually secured seven different sources of financing, including the use of historic tax credits and funding from the Prudential Foundation and Amelior Foundation. The Newark City Council also approved the city's first-ever incremental tax package, which provided a longer tax-abatement period and allowed the city to serve as a conduit for bonds to aid the project.
"It was a labor of love," Stern said of the quest for financing and the restoration of the building.
The historic character of the building has been maintained down to refurbishing the marble and molding in the lobby. The apartments, however, are filled with modern amenities such as granite countertops, hardwood floors and a washer and dryer in each unit. Some apartments have ter races and views of the New York City skyline.
Other amenities include a doorman, available maid service and grocery shopping service. To deal with the lack of parking in the area, valet parking will be available. But the feature Stern is most proud of is a full-size, four-lane AMF bowling alley.
"Everyone who signs a lease gets a free pair of bowling shoes," Stern said. "The reason we put all these amenities here is to give people alternatives while the rest of the city fills out."
Anticipating some student tenants, the building is designed so apartments can be shared. But Stern is hoping to attract lawyers and workers from Prudential who now leave the city after dark. The apartments, including studios and one- and two-bedroom units, range from $1,395 to $2,215 per month.
Kevin Ledig, 29, a law school student, and his wife, Pamela Juárez, 25, a dental student, were the first tenants to sign a lease in January. About 60 others have signed leases since, Stern said.
"You can still see the Empire State building and we love the fact that you are two blocks from Penn Station," Ledig said. "We want to be a part of what's happening in Newark, and this building has a lot to do with it."
© 2006 The Times of Trenton
© 2006 NJ.com All Rights Reserved.
All eyes are on Newark's new apartments
Thursday, June 15, 2006
BY JEFFERY C. MAYS The Lefcourt Building has long been a prominent fixture of Newark's skyline, but after falling on hard times, it lay vacant for 20 years.
More than 300 ironworkers, carpenters, laborers and electricians just completed a renovation, transforming the 35-story office building into 317 market-rate apartments. The $110 million makeover marks the first unsubsidized rental units downtown since the Colonnade Apartments were built in 1960.
Arthur Stern, chief executive of Cogswell Realty, the project's developer, said both his company and the city have much riding on the restoration of 1180 Raymond Blvd.
"This is the building that will be a catalyst for everyone else," Stern, wearing a white construction hat, said during a recent tour of the project. "It was an eyesore on the Newark skyline. This time next year, 500 people will be living downtown. This is what Newark needs."
For all the talk about Newark being the next Jersey City or Hobo ken, there still aren't enough people living downtown. In a city of 280,000, there are only 619 households -- slightly more than 1,700 people -- in the census tract that contains 1180 Raymond Blvd.
Despite the success of the New Jersey Performing Arts Center and the development of an arena for the Devils hockey team, residential projects have been slow to develop in downtown Newark. NJPAC re cently announced plans for a residential tower, but most of the construction over the past few years has been two- and three-family homes built on vacant lots.
Newark was second in the state last year with 2,064 residential building permits issued, compared with Jersey City's 3,194, but only 168 of Newark's permits were for structures with five or more units, according to city records. Jersey City, meanwhile, issued 2,329 permits for buildings with five or more units. The value of Newark's permits for five or more units was $3.9 million, while the value of Jersey City's permits in that category was $209 million.
BOOM OR BUST
Still, commercial real estate ex perts say if 1180 Raymond Blvd. succeeds, it could jump-start a downtown residential building boom in the state's largest city. Conversely, if the 317 apartments don't fill fairly quickly, residential developers could be scared away for years to come.
"Developers look at other projects, and so do banks and investors," said Carl Dranoff of Dranoff Properties, which has completed major housing development projects in Philadelphia and along the Camden waterfront. "A success (with 1180 Raymond Blvd.) cer tainly would be a great benchmark for future projects. A sluggish project could discourage future investment and would have a pretty immediate impact on financial institutions."
A couple of downtown market- rate residential projects are already on the drawing board, including a controversial Mulberry Street project that would see 2,000 condominiums rise near the federal courthouse over the next several years. A few blocks away from 1180 Ray mond Blvd. are two other Cogswell restoration projects, the Hahne & Co. Building and the Griffith Building.
With ongoing concerns about suburban sprawl and growing interest from city officials in expanding Newark's population, the tim ing might be right for a boom in rental housing downtown, said Stephanie Bush-Baskette, director of the Joseph C. Cornwall Center for Metropolitan Studies at Rutgers University-Newark.
"For the last several years, it's been about people living in the city and wanting a nice place to live and the convenience of mass transit," she said. City dwellers "want to walk to cultural events. Many people who work in Newark can afford it. This may be an option instead of getting on the train."
The Lefcourt Building, also known as the Raymond Commerce Building, was designed by prolific Newark architect Frank Grad and completed in 1929. A New York developer named Abraham Lefcourt intended to use the building, but went bankrupt in the stock market crash of 1929, according to historic preservation consultant Ulana Za kalak.
The tan Art Deco building is an important part of Newark's Four Corners historic district and is noted for its "distinctive and ex traordinary ornamental work," including terra cotta panels and metal ornamentation along the five-story base, said Glen Leiner, executive director of the Art Deco Society of New York.
Cogswell Realty acquired the building in 1999 from the Helmsley Group. Stern at first sought to re make the building into student housing, but those plans failed. Cogswell then spent a year on redesign plans and the next four trying to finance the project. The city of Newark was the only major entity that lent support, providing some financial commitments.
"The typical response from lenders was, 'That's a great project. We wish you the best of luck. Call us on the second one,'" Stern said.
ITS OWN MONEY
While waiting for financing, Cogswell used $18 million of its own capital to start construction. "Our feeling was if we don't start this thing, no one will believe it was happening," Stern said.
The gamble paid off. Cogswell eventually secured seven different sources of financing, including the use of historic tax credits and funding from the Prudential Foundation and Amelior Foundation. The Newark City Council also approved the city's first-ever incremental tax package, which provided a longer tax-abatement period and allowed the city to serve as a conduit for bonds to aid the project.
"It was a labor of love," Stern said of the quest for financing and the restoration of the building.
The historic character of the building has been maintained down to refurbishing the marble and molding in the lobby. The apartments, however, are filled with modern amenities such as granite countertops, hardwood floors and a washer and dryer in each unit. Some apartments have ter races and views of the New York City skyline.
Other amenities include a doorman, available maid service and grocery shopping service. To deal with the lack of parking in the area, valet parking will be available. But the feature Stern is most proud of is a full-size, four-lane AMF bowling alley.
"Everyone who signs a lease gets a free pair of bowling shoes," Stern said. "The reason we put all these amenities here is to give people alternatives while the rest of the city fills out."
Anticipating some student tenants, the building is designed so apartments can be shared. But Stern is hoping to attract lawyers and workers from Prudential who now leave the city after dark. The apartments, including studios and one- and two-bedroom units, range from $1,395 to $2,215 per month.
Kevin Ledig, 29, a law school student, and his wife, Pamela Juárez, 25, a dental student, were the first tenants to sign a lease in January. About 60 others have signed leases since, Stern said.
"You can still see the Empire State building and we love the fact that you are two blocks from Penn Station," Ledig said. "We want to be a part of what's happening in Newark, and this building has a lot to do with it."
© 2006 The Times of Trenton
© 2006 NJ.com All Rights Reserved.
posted by Jones Lang LaSalle NJ News Blog at 10:29 AM
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