This is a company blog used by the New Jersey Jones Lang LaSalle Team to keep track of current events within the real estate sector. All items posted on this website are originally written by other authors from various sources. This is simply used as a searchable tracking system for news we found relevant to our business.
N. Arlington OKs development Thursday, April 20, 2006
By CAROLYN FEIBEL STAFF WRITER NORTH ARLINGTON -- Over the jeers of residents, the Borough Council voted 4-2 Wednesday night to sign an agreement with a developer to build 1,625 residences along Porete Avenue.
Cherokee EnCap will build the homes and 50,000 square feet of retail along the road, which is in the shadow of a landfill and is home to warehouses and light industrial businesses.
But many of the business owners don't want to leave and have vowed a court battle if the town condemns their properties for the Arlington Valley project.
The possibility that the borough could use eminent domain has aroused emotional opposition to the project and has become the No. 1 issue in the June primary election.
"I sympathize with each and every business owner affected by the project," Mayor Russ Pitman said. "Believe me, the use of eminent domain is a last resort."
The project would bring much-needed tax relief, Pitman said. The new borough budget, also introduced Wednesday night, would lower the tax levy on the average home by $128, with the tax rate cut to $1.17 from $1.24 for every $100 of a home's assessed value. The reduction is partially the result of a $486,000 payment from the developer.
"Other towns are raising taxes; we're reducing taxes," Pitman declared.
Cherokee would pay North Arlington $17.3 million in development fees during the next four years, and $3.75 million to help the borough fulfill its affordable housing obligation.
After Arlington Valley is finished in 2010, the borough would take in about $16 million a year in the form of payments in lieu of taxes, Pitman said.
Even after the borough pays for policing the development and for accommodating an additional 350 schoolchildren, the borough would have $6 million left over to reduce taxes, he added.
But many residents said they did not trust those projections and accused the mayor of condemning the town to years of crowded schools and roads.
"The Belleville Turnpike will have utter chaos," said Barbara Gangi, a 34-year resident. She held a poster that said, "Eminent Domain Abuse" crossed by a red bar.
Councilmen Peter Massa and Steve Tanelli voted against the agreement.
"This deal smells," said Massa, who is running against Pitman for mayor in the Democratic primary. "This is a rotten deal for North Arlington. It's great for the guys who are set to make a lot of money on this deal."
Massa said he would ask the state attorney general and the U.S. attorney for New Jersey to investigate the agreement.
Tanelli said he opposed the seizure of businesses and the inclusion of 65 units of affordable housing. The project would lead to the "complete urbanization of this borough," he said.
The council also introduced an ordinance limiting its power to condemn homes for private developer, but Massa and Tanelli voted against it on its first reading because it would not protect businesses.
Peter Goodman, owner of Goodman Sales on Porete Avenue, said he does not want to move his plumbing supply business.
"The farther away you move, the more employees you lose," he said. "They're selling the town a bill of goods," he said of the council.
Goodman has joined the North Arlington Property Rights Coalition, a group of 15 businesses that has hired lawyers and consultants to fight the developer.
The group has said that condemning the businesses would take away $1 million in current tax revenue and displace about 500 jobs.
posted by Jones Lang LaSalle NJ News Blog at 5:02 PM
Xanadu opening delayed 6 months Thursday, April 20, 2006
By PRASHANT GOPAL STAFF WRITER The Meadowlands Xanadu entertainment and retail complex probab;y won't open until mid-2008, about six months behind schedule, the chairman of the New Jersey Sports and Exposition Authority said Wednesday.
The delay comes because developer Mills Corp. is redesigning portions of the $1.2 billion project at the request of two likely tenants, authority Chairman Carl Goldberg said after a two-hour meeting with Mills' new chief operating officer, Mark Ordan.
The authority is the project's landlord and has been concerned about the financial struggles of Mills, which has been rocked in recent months by financial restatements, an ongoing Securities and Exchange investigation and executive layoffs.
Mills, which began construction on the Meadowlands project last spring and hoped to open for the Christmas 2007 shopping season, has backed away from projects elsewhere in the country, but Goldberg said after Wednesday's meeting that the developer offered a reasonable explanation for delays here.
The redesign includes changes to a building that is expected to be occupied by Wannado City, a 100,000-square-foot children's role-playing facility, and suggests that Mills is close to making a deal with another major tenant, who has not yet been disclosed to the public, Goldberg said.
"If Mills has the confidence level to be fabricating and pouring concrete according to the specifications of these tenants, it suggests a fairly high degree of confidence," Goldberg said.
So far only four tenants -- including a Muvico movie theater and the Cabela's outdoors and fishing store -- have been announced as signing leases.
Goldberg said the company didn't show him any new signed leases at the meeting, but he saw unfinished leases for more than a dozen prospective tenants. The company said it expects to get aggressive about signing up tenants at the International Council of Shopping Centers conference in Las Vegas next month.
"Mills will have a full complement of leasing agents working there with the focus on Xanadu," said Xanadu spokesman Bob Sommer on Wednesday night.
Goldberg said that during the meeting Ordan reassured him and authority President George Zoffinger that Mills will be able to pay for the project's construction, at least through the end of the year.
Some Wall Street analysts expect Mills -- or at least some of its malls -- to be sold to another company by then, which would likely bring fresh financing to the Meadowlands project.
Mills announced in February that it is seeking "strategic alternatives.''
On April 12, Mills said that its lenders agreed not to default on their loans even though the company's 2005 annual report has yet to be filed because of accounting mistakes.
The company also managed to free up nearly $250 million by arranging for a $625 million mortgage for its Sawgrass Mills mall in Florida.
The new bank waivers and loan agreements include restrictions that suggest a sale of the company is a priority, analysts say.
Goldberg said he's not concerned that more leases haven't been signed because it's still relatively early in the process.
"I think the most important leasing period is from now to the early fall," Goldberg said. "By early fall, we should have a clear understanding of who wants to be in the facility and if it's fitting together."
posted by Jones Lang LaSalle NJ News Blog at 5:02 PM
Senior housing, a "niche" real estate market, is getting a lot of attention from investors these days. This is not surprising: the share of population aged 65 and over has been steadily increasing since 2000, with over half a million people joining that club every year.
Bureau of the Census projects seniors will account for nearly 20% of the U.S. population by 2030, up from less than 13% today. In five years, there will be over 40 million people aged 65 and older. Thereafter, this will be the only major age group to gain share in the overall population. In less than a generation, it will turn from a "niche" to a major housing market segment, closely rivaling the population aged 18-34, which is traditionally viewed as the main source of multi-housing demand.
Seniors Gain Market Share
Source: TWR calculations based on Bureau of the Census projections.
The South and West of the U.S. are where most of the growth in senior population is concentrated. Florida, Texas, Virginia, Georgia, Maryland, North Carolina, South Carolina and Tennessee will account for about 40% of the increase in population aged 65 and over in this decade. California, Arizona, Washington, Nevada, and Colorado will account for another 26%. In fact, net increase in seniors' population in either the whole of the Midwest or the Northeast will be less than that in California alone. More seniors are expected to be added in Texas than in New York, New Jersey, and Illinois combined.
There are several sub-classes of housing—including active adult, assisted living, continuing care, independent living and nursing facilities, as well as senior apartments—all of which will cater to the growing population of seniors. One would think that current development of such housing follows regional demographic trends, but a closer look at the distribution of new construction reveals a different picture!
The TWR/Dodge Pipeline shows that the Northeast and Midwest account for a larger share of the over 100 thousand "senior housing" units currently under construction. The West and South are expected to account for over 75% of growth in the seniors' population, yet they only account for 45% of the "senior housing" being built. There are twice as many "senior housing" units under construction today in Illinois as in Florida!
South and West Lead Growth in Senior Population, Northeast and Midwest Lead "Senior Housing" Construction
Sources: Bureau of the Census, TWR/Dodge Pipeline.
Why is regional distribution of new "senior housing" construction so markedly different from the regional distribution of growth in senior population? One reason is that there is simply a lot more existing senior housing in the South and West—regions with historically higher shares of senior population. The two regions already account for over half of the nation's senior population and well over half of the existing senior housing inventory.
Another reason is that increasing numbers of seniors might be staying in their present states after retirement. One recent survey, for example, names Chicago as one of the possible retirement destinations for aging baby-boomers: after all, Chicago is actually more affordable than many sunny destinations in Florida or California. While few Miami "baby-boomers" will likely retire in Chicago, those currently living in Chicago may very well stay put, and will demand more service-oriented housing to meet their needs.
Those who invest in rental housing today better start paying attention to senior housing supply—especially age-oriented apartments, since they will eventually compete with the traditional apartments for a rapidly-growing demand segment. And better yet, rather than viewing senior housing only as a "niche" market, why not make it part of your apartment investment strategy? Just make sure that you build or purchase your senior housing property somewhere that has an abundance of income- and need-qualified seniors. While senior housing is a growing market, don't assume that demand for the various types of this product will grow at the same rate everywhere.
posted by Jones Lang LaSalle NJ News Blog at 5:01 PM
Hampshire Buys 88,000-SF Industrial Asset By Eric Peterson Last updated: April 20, 2006 09:36am
OAKLAND, NJ-The Hampshire Cos. has acquired the 87,840-sf industrial building at 8 Thornton Rd. here. The acquisition was made through Hampshire Partners Fund VI, Hampshire’s institutional investment fund, which targets value-add industrial, retail and suburban office properties in the Northeast.
The building was acquired from the Zrike Co., a marketer of tableware and giftware. The transaction is a sale-leaseback; Zrike will continue to use the location as its headquarters. The sale price and terms of the lease were not disclosed.
"The property fits in well with our overall strategy of acquiring investment-grade properties in growth locations that will provide a stable cash flow for our investors," says Norman A. Feinstein, executive vice president of the Morristown, NJ-based Hampshire Cos. "This acquisition has tremendous upside potential both for the Zrike Co. and our investors." Situated on five acres near I-287 in Bergen County, the one-story building has 24-foot clear ceiling height.
posted by Jones Lang LaSalle NJ News Blog at 5:00 PM
231,000-SF Office Complex Is on the Block By Eric Peterson Last updated: April 20, 2006 02:05pm
EDISON, NJ-Berkshire Funding Group is set to sell the three-building 231,082-sf Edison Square office complex here, and has given the exclusive to move the property to Newmark Knight Frank. NKF managing principals Paul Giannone and James Scanlon and managing director Kevin Carton, all of the firm’s Woodbridge, NJ office are working on the assignment. Located on 16.6 acres at 2025-2045 Lincoln Highway (also known as Route 27) in Central New Jersey’s Middlesex County, the property’s three buildings were constructed in phases between 1984 and 1987. The 2025 and 2035 buildings are 67,463 and 97,156 sf respectively, and are currently more than 90% leased to a total of 24 tenants. The 2045 building totals 67,463 sf and is vacant at the moment.
"This property has a stable cash flow, and the offering should be attractive to investors who would be looking to subdivide the 2045 building, or to a buyer that is looking to occupy the building," Carton says. And Berkshire Funding is looking to move the building quickly: Property inspections are under way, according to Carton, and final bids are due on May 15. "Time is of essence."
The three buildings are configured around a central courtyard and fountain, and the complex also features its own heliport, located in back of the 2035 building. The property also comes with an option to build an additional 35,000-sf building on site. Also located at the property, but not included with the sale offering, is a 170-room Clarion Hotel & Conference Center.
posted by Jones Lang LaSalle NJ News Blog at 5:00 PM
Hamilton Mayor Glen Gilmore met with supporters and signed a veto of council's decision last night to rescind the redevelopment plan for the northwest portion of the township. About 50 supporters, mostly union workers, witnessed the mayor sign the veto at the American Metro development near the Hamilton Train Station.
After more than three hours of tense and emotional debate last night, the council voted to rescind the redevelopment plan that governs construction in the township's northwest portion. As expected, the vote was 3-2 for repeal with Republican Councilmen Tom Goodwin, Dennis Pone and David Kenny in favor and Democrats Ed Pattik and Shannon Cenci opposed.While the Republicans had the three votes necessary to rescind the plan, they are not likely to have the fourth vote necessary to overturn Gilmore's veto.
The plan for the 1,000-acre redevelopment zone was approved in 2004 as part of Gilmore's push for development around Hamilton's NJ Transit station. The plan sets the parameters for three projects either proposed or already under construction in the area: 450,000 square feet of office space and 680 condominiums, townhouses and apartments on the American Standard site and a mixed-use development at the train station.That station development, jeopardized by the repeal, calls for an additional 300 residences, 200,000 square feet of office space, 125,000 square feet of retail space, a 200-room hotel, 100 long-term stay suites and a 1,280-space parking garage.
Estimates have shown the developments could mean as much as $10 million in revenue to the township and officials are eager for the tax relief it would mean. Only by developing the project with the housing can the township realize the windfall, officials have said. More than 200 residents were at the meeting last night and emotions ran high as many had their say. Several times, the gathered crowd erupted into applause or shouts as people on each side of the issue presented their views. -- Contributed by Staff Writer Darryl Isherwood
posted by Jones Lang LaSalle NJ News Blog at 4:59 PM
State lost 5,500 tech jobs in '04, fewer than in '03 Posted by the Asbury Park Press on 04/20/06 BY DAVID P. WILLIS BUSINESS WRITER
New Jersey lost 5,500 technology jobs in 2004, according to a report released Wednesday. While the number of technology jobs fell to 197,100, the loss narrowed over the previous year, according to state figures compiled by the AeA, formerly the American Electronics Association. In 2003, the state lost 14,600 technology jobs.
Linda Klose, executive director of the AeA New Jersey-Pennsylvania Council, said she expected to see some job loss.
"I am grateful that it is not worse than it is," Klose said.
Klose could not point to any specific company cuts but said the decrease likely came as businesses cut jobs to save costs or moved positions out of New Jersey.
"I think you will find a lot of what has happened is to make do with less," she said. "All states are in competition with each other, as well as the world."
New Jersey was not alone. The United States lost 44,700 technology jobs in 2004 and 333,000 in 2003.
The report, titled Cyberstates 2006, covered the 50 states, Washington D.C. and Puerto Rico. Twenty-five states, including Virginia and Florida, added technology jobs in 2004 while 27 states, such as California and Texas, saw declines.
Among other findings in New Jersey, the AeA said:
Technology workers earned an average wage of $82,500 in 2004, making it the third-best-paying state for technology workers in the country. That salary figure represents 73 percent more than the state's average private sector wage. In 2003, the average technology wage was $78,500.
Telecommunications services represented the greatest number of jobs lost, 3,500, in 2004. Economist James Hughes said the job losses in technology is a continuation of what has happened over the past decade. New Jersey lost 9,800 technology jobs between 1990 and 2004, he said. During that time, the U.S. added 1.3 million such jobs, he said.
"We were once almost a dominant high-technology sector with Bell Labs and Sarnoff Labs and Exxon Mobil," said Hughes, who is dean of the Edward J. Bloustein School of Planning and Public Policy at Rutgers University. "This is a sharp change from that once dominant position." But there is a bright spot in the Cyberstates report, at least nationally. In 2005, the technology industry added 61,000 jobs, the first increase after a four-year decline, the AeA said. State figures were not available for 2005.
Klose said she did not think New Jersey's job loss is "horrendous. I think it is recoverable." New Jersey needs to stress education in mathematics and sciences in young people and encourage advanced courses, Klose said. "We need to have an educated work force," Klose said. The state also has to develop more business-friendly policies for companies, such as reinstating the tax credit for net operating losses.
"The atmosphere in New Jersey for business, as you know, has been less than friendly the last few years," Klose said. "We are all taking a wait-and-see attitude on this."
posted by Jones Lang LaSalle NJ News Blog at 4:59 PM
State's job pace lags the nation's Posted by the Asbury Park Press on 04/20/06 BY MICHAEL L. DIAMOND BUSINESS WRITER
New Jersey added 3,700 jobs in March, and its jobless rate fell to 4.5 percent from 4.7 percent in February, the state Labor and Workforce Development Department reported Wednesday. The figures indicate the job market is growing slowly and steadily, economists said, but not fast enough to keep up with the rest of the country.
"This is basically a continuation of what we've been seeing the past two years," said James W. Hughes, an economist and dean of the Edward J. Bloustein School of Planning and Public Policy at Rutgers University. "The past two years has seen slow overall growth, and the growth that does take place has been in the low-paid sectors."
By comparison, the nation added 211,000 jobs in March, and its unemployment rate fell to 4.7 percent in March from 4.8 percent in February. Because New Jersey accounts for about 3 percent of the job market, it should have created 6,330 jobs.
Taken over a longer time frame, Hughes said, the statistics are more discouraging. He said the state added 4,600 jobs during the first quarter, all of which were in the public sector. That puts the state on pace to create 18,400 jobs for the year — a far cry from the 70,000 jobs a year it has historically created during an expansion.
Business groups have said the state's high costs and strict regulations have caused many employers to move elsewhere.
Monmouth Rubber and Plastics Corp., a Long Branch manufacturer of rubber and plastic used in products such as football and baseball helmets, might have to vacate its 35,000-square-foot building to make way for a redevelopment project, owner John M. Bonforte Sr. said.
Where he winds up isn't certain. Bonforte has visited Georgia, South Carolina and North Carolina, where he said public officials have greeted him warmly.
But it sounds as if he would rather stay in New Jersey. The company has 48 employees, compared with 42 a year ago, thanks to a robust economy that has created a demand for its products, Bonforte said.
"We've done the numbers," Bonforte said. "You can do it in New Jersey if the right people in the state know you're there and appreciate you're there, so there's a cooperative approach to whatever problem comes along."
The state's private sector recovered in March by adding 3,300 jobs, the state reported. The leisure and hospitality sector gained 2,200 jobs; the education and health services sector added 1,700 jobs; and the trade, transportation and utilities sector added 1,100 jobs.
Two sectors that are considered high-paying, however, lost jobs. Professional and business services lost 1,100 jobs and financial activities lost 100, the state reported.
Vicki Fowler, owner of Spherion Corp., an employment agency in Shrewsbury, said high-paying jobs remain there for the taking for workers who have strong computer and communication skills.
And David J. Socolow, acting commissioner of the Department of Labor and Workforce Development, said New Jersey is taking steps to ensure workers have more high-paying jobs to choose from.
One example: A work-force training program that once was geared solely toward manufacturers is being expanded to include companies from targeted sectors — technology, pharmaceutical, logistics and transportation to name a few — that pay more than the state's median wage, Socolow said.
"We're using the work-force development (program) in a more targeted and strategic way," Socolow said.
posted by Jones Lang LaSalle NJ News Blog at 4:58 PM
April 20, 2006 -- Boston Properties has hit a snag on its sale of Five Times Square to Dubai-based Istithmar, even though the $1.1 billion deal for 280 Park Ave. in the same package is forging ahead.
Sources told The Post that Istithmar, an investment vehicle for the family-controlled Gulf Emirate, is apparently concerned that when tax incentives for the site expire in 2022, after-tax rents won't give them the return they were looking for at Five Times Square, which was set to change hands for $1.1 billion.
A report yesterday from Merrill Lynch analyst Steve Sakwa noted the tax incentive problems with the 1.1 million-square-foot building. Other sources have confirmed Istithmar's worries to The Post.
Sakwa also said Boston Properties will likely sell 280 Park Ave. for more than $950 a foot. If only the Park Avenue deal sails, Sakwa expects Boston Properties - controlled by Daily News Publisher Mort Zuckerman - to pay out a special dividend of $5 to $6 per share, down from his previous estimate of $10 per share for the twofer.
Five Times Square is a 2002-era tower rented to Ernst & Young, Giuliani & Partners, and retailers including Red Lobster.
It is technically on a long-term ground lease to New York State's redevelopment Arm. Boston Properties received some tax relief and agreed to lower rents as part of the deal to help redevelop the then-blighted Times Square area.
Another developer familiar with the Times Square incentives said, "When the incentives wear off, [real estate] taxes could be as much as $18 or $20 a foot."
posted by Jones Lang LaSalle NJ News Blog at 4:57 PM
Hampshire Forms Destination Company By Eric Peterson Last updated: April 19, 2006 09:27am (For more retail coverage, click GlobeSt.com/RETAIL.)
BERNARDSVILLE, NJ-The Hampshire Cos. has formed Hampshire Destination Properties, a new company that will manage and operate Hampshire-owned hotel, restaurant and retail locations. HDP, based here, will be an independent company focused on acquiring, developing and managing properties for its Morristown, NJ-based parent.
"Hampshire Destination Properties will leverage the Hampshire name, providing us with a familiar identity," says Jeffrey B. Hanson, who will head the new operation, and whose family has owned and operated the Hampshire Cos. for more than 30 years. "We are focused on assembling a portfolio of hospitality-oriented properties throughout Central New Jersey."
HDP is starting off with two properties under its aegis. They include BaseCamp Adventure Outfitters, a seller of outdoor equipment located in Basking Ridge, NJ, and the Station Pub & Grub, a restaurant across from the commuter rail station here.
posted by Jones Lang LaSalle NJ News Blog at 4:57 PM
Work Starts on 100,000-SF Office in Exit 8A Market By Eric Peterson Last updated: April 19, 2006 02:44pm
CRANBURY, NJ-M. Gordon Construction Co. has started construction on 1249 South River Rd., a 100,000-sf office building here. Located in the New Jersey Turnpike Exit 8A submarket, approximately 1.5 miles from the interchange itself, the three-story asset is slated for delivery in the spring of 2007.
The Linden, NJ-based M. Gordon Construction has also given the leasing exclusive for the speculative project to Weichert Commercial, Morris Plains, NJ. For Weichert Commercial, the assignment is being handled by senior vice president Kim Kretowicz and vice presidents Mario Chiarella and Mark Fowler.
"Because of the building’s close proximity to Princeton, and to the New Jersey Turnpike, we are confident that it will draw a great deal of interest," says John G. Udell, Weichert Commercial’s president. The three-story building has floorplates in the vicinity of 30,000 sf in configurations termed "unusually efficient" by David A. Simon, Weichert Commercial’s executive vice president and managing director.
The facility has been designed "to allow the maximum amount of light into the work environment." And the third floor of the asset features balconies "that can be used to enhance a company’s executive environment, or can be utilized to create unique meeting rooms." Another feature of the project is that like a number of M. Gordon Construction’s projects, ownership participation is on the table for prospective tenants.
posted by Jones Lang LaSalle NJ News Blog at 4:57 PM
Bank of America 1Q Profit Up 14 Pct. Thursday April 20, 7:23 am ET Bank of America First-Quarter Profit Up 14 Percent, Lifted by MBNA Acquisition
CHARLOTTE (AP) -- Bank of America Corp. said Thursday first-quarter profit surged 14 percent as the nation's largest retail bank was boosted by its acquisition of credit card company MBNA Corp.
Quarterly profit rose to $4.99 billion, or $1.07 per share, from $4.39 billion, or $1.07 per share, in the year-ago period. Excluding charges related to the acquisition., Bank of America posted earnings of $5.05 billion, or $1.08 per share.
Results included expenses of $320 million, or 5 cents per share, from the impact of stock option accounting. In addition, Bank of America said it terminated some derivatives used as part of its hedging strategy, reducing earnings per share by $175 million, or 2 cents per share.
Analysts, on average, projected earnings of $1 per share on $16.79 billion of revenue, according to Thomson Financial.
Strong performance at its consumer businesses and improvements in trading accounts performance and equity investments drove revenue up 31 percent to $17.94 billion from $13.74 billion a year earlier. On a pro forma basis, as if MBNA had been part of Bank of America's operations for the year-ago quarter, revenue rose 10 percent.
"We have strong momentum in all our businesses as the benefits from continued execution in our consumer businesses were accompanied this quarter by a rebound in trading and good performance in investment banking and wealth management," said Chairman and Chief Executive Ken Lewis in a statement.
posted by Jones Lang LaSalle NJ News Blog at 4:56 PM
Schering-Plough profit beats forecasts Thursday April 20, 7:10 am ET
NEW YORK (Reuters) - Schering-Plough Corp. (NYSE:SGP - News) on Thursday reported first-quarter earnings that beat Wall Street expectations, helped by increased sales of its treatments for infections and allergies.
The company also said demand for the cholesterol drugs it shares with Merck & Co. Inc. (NYSE:MRK - News) was strong, although sales from the joint venture are not recorded as part of Schering-Plough's quarterly results.
The Kenilworth, New Jersey-based drug maker had a net profit of $350 million, or 24 cents per share, compared with a profit of $105 million, or 7 cents a share, a year before.
Schering-Plough shares have slipped about 10 percent this year compared with a rise of about 1.5 percent in the American Stock Exchange Pharmaceutical Index.
Excluding a gain from the change in accounting principles, the company earned 22 cents per share. Analysts on average had expected 14 cents per share, according to Reuters Estimates. Quarterly sales rose 8 percent to $2.6 billion, but would have risen 12 percent to $2.9 billion if the company had booked its 50 percent share of cholesterol-drug sales from its venture with Merck.
posted by Jones Lang LaSalle NJ News Blog at 4:55 PM
Pfizer cuts construction plans in Morris, Parsippany Thursday, April 20, 2006 BY LAWRENCE RAGONESE Star-Ledger Staff
A massive expansion and renovation of Pfizer's Morris Plains campus has been scaled back, and plans by the pharmaceutical giant to build a $100 million product testing facility in Parsippany have been scrapped, according to company officials.
The changes are a result of a company-wide cost-cutting effort, which likely will include the sale of its Morris Plains-based consumer products division, company spokesman Bryant Haskins said.
"We are just slowing down construction until a final decision is made about the consumer health business," Haskins said this week. "It just makes good sense right now."
Pfizer announced in February it was seeking a buyer for its over-the-counter business, which markets products such as Sudafed, Rogaine, Listerine and Benadryl. British drugmaker GlaxoSmithKline, Colgate-Palmolive, Novartis and Unilever are among companies considered as possible buyers, according to analysts.
"We are watching this carefully. There is no question this is big to Morris Plains," said Mayor Frank Druetzler, who has been briefed by Pfizer officials on the company's plans. "It's unsettling for this town, no doubt."
Druetzler, who also is a Morris County freeholder, said the company pays $3.6 million in property taxes, financing 17 percent of the borough's municipal budget.
The change of plans also will hit hard in Parsippany, where Pfizer had invested $8 million to evaluate whether to build a pilot plant to test products at a site on Webro Road. Instead, that work will be done in Morris Plains, company officials said.
That follows a decision by Pfizer last year to shut down its Parsippany manufacturing plant and lay off 490 workers at a site adjacent to where it had considered building its new pilot plant. The move was part of a companywide restructuring that included closing 27 other manufacturing sites around the world, the company said.
"This is the first I've heard of this," Parsippany Mayor Michael Luther said yesterday when informed Pfizer has decided to eliminate the $100 million facility in his town. "We have not been briefed on this by Pfizer."
Pfizer inherited the Morris Plains facility in 2000 with its acquisition of Warner-Lambert, which had been based there since 1947.
Acting Gov. Richard Codey broke ground in June on Pfizer's planned $200 million research and development facility at the company's 175-acre Morris Plains campus. At that time, company officials said the number of jobs there could more than double, from about 2,000 to 5,000.
The company's master plan called for called for demolition of 1960s-era buildings on the west side of Route 53, adding up to 1.5 million square feet and renovating another 700,000 square feet. There also would be three new parking decks with room for about 3,000 cars.
However, the plans are being altered, Haskins said.
On the west side of Route 53, two main buildings were scheduled for demolition, to be replaced by new, expanded structures. Now, only one will torn down and the so-called "182 building" will eventually be renovated and possibly expanded.
Workers who would have moved to a new Parsippany facility would likely be located there, Haskins said.
On the east side of Route 53, renovations to the "201 building," the headquarters for consumer health operations, will be delayed.
Also, a new office building that is mostly erected will get its exterior completed, but the interior will remain empty. The future of both are connected to the future of the company's consumer health business, Haskins said.
"This is giving us flexibility on the Morris Plains campus, while we are doing the analysis on consumer health," he said. "That's the smart thing to do right now."
posted by Jones Lang LaSalle NJ News Blog at 4:55 PM
State board gives a clean bill to Touro Medical School plan Thursday, April 20, 2006 BY CAROL ANN CAMPBELL Star-Ledger Staff
New Jersey came closer to getting its only private medical school yesterday after a state board approved a bid by Touro College, a nonprofit organization that wants to build a school in Florham Park.
Touro College, a nonprofit Jewish organization, operates 23 schools, including a law school in New York and medical schools in California and Las Vegas.
Touro now must begin the rigorous accreditation process by the Liaison Committee on Medical Education, an independent authority. If approved, Touro Medical School of New Jersey, a $50 million project, would be the state's first medical school since the UMDNJ-School of Osteopathic Medicine was created in 1976.
No state funds will be used in the project.
"This is an offer New Jersey couldn't say no to," said Robert Torricelli, the former U.S. senator who now works as a private consultant. He has lobbied for the school.
Yesterday's vote by the state Board of Medical Examiners was unanimous.
Proponents of the school pointed to a looming doctor shortage. One projection shows the U.S. will be short 85,000 physicians by 2020.
Torricelli said New Jersey has the nation's second-highest percentage of foreign-trained physicians, 38 percent vs. 23 percent nationally. More than half the residency training programs at New Jersey hospitals are filled by foreign-trained graduates, twice the national average, he said.
Not everyone in New Jersey believes the doctor shortage will be solved by creating new schools. Yesterday's approval came despite objections from officials at the UMDNJ-New Jersey Medical School, who said a new school could compete for faculty as well as training spots at hospitals.
"A competing medical school will limit the training options available to our students," Robert L. Johnson, interim dean of the New Jersey Medical School, said at a recent hearing, according to written testimony. Touro also could jeopardize the medical school's plans for expansion, he said.
Peter Carmel, a professor at New Jersey Medical School, testified that New Jersey residents have "ample opportunity" to get into a medical school in New Jersey, and that current medical schools should be expanded to meet the need for additional doctors.
A report by the state medical board's Touro Committee largely rejected the arguments by UMDNJ. "The committee is not convinced that the presence of additional students will threaten UMDNJ's success in the ways anticipated," the committee report said.
The school plans an affiliation with Stevens Institute of Technology in Hoboken. Basic sciences faculty from Stevens would work part-time at the new medical school. One-third of Touro medical students would come from Stevens through a joint degree program, said Sean Jackson, a consultant for Touro from Rosemont Associates in Lambertville.
Touro has had "discussions" with Cathedral Healthcare System, which operates St. Michael's Medical Center in Newark, about sponsoring clinical training of Touro students.
The board required that Touro, while it seeks full accreditation, not interfere with hospital training affiliations currently in place for UMDNJ medical students.
Yesterday's decision allows the school to more aggressively begin fundraising -- and moves Touro farther away from its early brush with New Jersey scandal. Its first financial backer, Charles Kushner, was arrested on charges he made illegal political donations, and claimed charitable donations as business expenses.
Kushner was transferred in late March to a Newark halfway house after spending less than half his two-year term at a prison camp in Alabama. He could be freed completely in August.
The board committee report described the school as financially viable, saying Kushner has agreed to donate up to $10 million. Tuition would be from $25,000 to $30,000 annually. Touro College, meanwhile, has an endowment of $35 million and is selling assets valued at $150 million to $180 million, the report noted.
Jackson said Touro hopes to have students by 2008, and would have about 100 students in each class. In contrast, the New Jersey Medical School has a total of 700 students and the UMDNJ-Robert Wood Johnson Medical School has 643 students. The UMDNJ-School of Osteopathic Medicine has 380 students.
posted by Jones Lang LaSalle NJ News Blog at 4:54 PM
CBRE Acquires Majority Interest in Russian Affiliate April 19, 2006 By Amanda Marsh, Staff Writer
CB Richard Ellis Inc. announced today that it has acquired a 51 percent ownership interest in Russian affiliate Noble Gibbons from Alfa Capital Partners investors and shareholders. The firm will now operate as CB Richard Ellis Noble Gibbons.
"Russia is a very major, fast-growing economy," CB Richard Ellis Europe, Middle East and Asia executive chairman Michael Strong (pictured) told CPN this afternoon. That is exactly the type of market his company is tapping into. "We're constantly open to discussions that match our strategies ... and enable us to expand (into emerging markets)." Strong would not divulge what other companies CB is talking to, but hinted at additional European expansion this year.
CB has committed to purchasing the remaining outstanding shares of Noble Gibbons, and while that is subject to certain conditions, Strong estimated it will take place toward the end of the year. The firm, based in Central Moscow, has been a CB affiliate since 1995 and includes a full array of real estate advisory and management services. Its sales and leasing transaction volume was valued at approximately $233 million last year, and it manages more than 2.6 million square feet of commercial real estate. Strong said Noble Gibbons' operations and management will remain the same; they will just be under the CB brand.
The transaction continues CB's strategy of buying into leading affiliate firms in regional markets. Its most recent such deal was with Tokyo's IKOMA CB Richard Ellis K.K. in January, in which it also increased its ownership stake to 51 percent. It has made three other, smaller deals in Europe this year, including acquiring Belgian retail specialist Immobilière Développement & Gestion, forming a property management joint venture with Belgium's Sogesmaint and, most recently, acquiring British property consultant Austin Adams two weeks ago.
posted by Jones Lang LaSalle NJ News Blog at 4:54 PM
Cushman Increases San Diego Presence with Alliance Acquisition April 19, 2006 By Amanda Marsh, Staff Writer
Cushman & Wakefield Inc. has acquired brokerage firm San Diego Corporate Real Estate Advisors. Previously a member of the Cushman & Wakefield Alliance, the firm will now serve as the global real estate service provider's San Diego branch office.
The move represents a return to the market for Cushman & Wakefield, which operated a branch office there until 2001, when it restructured and shut down the branch. The office's managing director, Stephen Rosetta (pictured), started up San Diego Corporate Real Estate Advisors. He has been appointed executive director and managing broker of the merger.
"It made sense for Cushman & Wakefield to re-enter the market," Rosetta told CPN this afternoon, describing San Diego as a competitive market. "Cushman & Wakefield will now have a bigger foothold in San Diego ownership." The merger will also bring Cushman & Wakefield brokers to 16, up from only two in the previous iteration.
The full integration into Cushman & Wakefield is also positive for San Diego Corporate Real Estate Advisors brokers and employees, as it "gives us access to deeper resources," Rosetta said. The firm already has a roster of major clients, including Fish & Richardson, Nokia, Siemens and Hewlett-Packard. Last year, its total transaction volume was over $292 million in 183 deals, representing almost 2.5 million square feet of activity.
The merger is only one step that Cushman & Wakefield has taken to bolster its San Diego operations. It recently added three top industry professionals to its valuation services group--Lance Dore, Brian Curry and D. Matt Marschall--who are developing national appraisal practices for agribusiness, energy and master-planned communities.
posted by Jones Lang LaSalle NJ News Blog at 4:54 PM
Two Newark companies are among the winners of the ICIC-Inc. Magazine Inner City 100 list of the fastest growing urban companies, which will be released today.
Bare Necessities and El Taller Colaborativo of Newark were selected to the Inner City 100 out of 4,500 companies that were nominated.Bare Necessities, No. 10 on the list, had $12 million in sales and 28 employees under Chief Executive Noah Wrubel, whose family has owned a chain of four lingerie boutiques in the New York area for the past 35 years.El Taller Colaborativo, No. 93 on the list, had $10 million in sales and 85 employees under Chief Executive Alex Garcia.
The architectural and engineering company has planned and designed more than 300 projects, including a contract to maintain handicap ramps for the U.S. Postal Service in northern New Jersey.
posted by Jones Lang LaSalle NJ News Blog at 4:53 PM
$10M Takes 60,000-SF Office By Eric Peterson Last updated: April 18, 2006 02:50pm
BEDMINSTER, NJ-Direct Invest has acquired the 60,000-sf office building at 150 Morristown Rd., also known as Route 202/206, in this Somerset County community. The building traded for $10 million, which factors out to nearly $167 per sf. The seller was ABC Properties/Belvidere Capital. Buyer Direct Invest is a two-year-old firm formed by a group of one-time WP Commercial and Archon Atlantic execs, headed by Richard Previdi.
"The sale illustrates the power of private investors in the New Jersey office market today," says Jose Cruz, a senior director with Cushman & Wakefield’s Metropolitan Area Capital Markets Group, East Rutherford, NJ. Cruz orchestrated the sale along with C&W executive director James L. Frank.
According to Cruz, the sale went through a three-round bidding process involving 15 initial bidders before ABC Properties/Belvidere Capital opted to sell to Direct Invest. "The offering of 150 Morristown Rd. was met with heated competition from potential buyers."
"Most of the top bidders were private players," Frank says. "This can be attributed in part to the building’s size, which is smaller than many institutions will consider. At the same time, the aggressive nature of the bid process dictates that private players are among today’s most notable investment groups. We’ve seen increased competition from this group in light of the debt market’s current abundance of available capital."
The building is currently 90% least to a mix of tenants, including Gravity Systems, a regional office of Pulte Homes, Sterling Care Group and several professional offices. "This is a great in-town location and an outstanding repositioning opportunity for Direct Invest," Cruz says. "Zoning in Bedminster will not allow additional office inventory, which ensures this property’s future competitive position. Right now, rents are in the mid- to upper $20s range, but the buyer is planning a repositioning that will bring it to class A status. I feel that this will justify increasing rents to the $30 per sf range in the very near future."
posted by Jones Lang LaSalle NJ News Blog at 4:52 PM
Reckson Creates New Position for Westchester/Connecticut Focus By Barbara Jarvie Last updated: April 18, 2006 12:24pm
MELVILLE, NY-Reckson Associates Realty Corp has hired David Sims in the role of senior vice president and managing director of its Westchester/Connecticut division. In this newly created position, Sims will be responsible for the formulation and execution of the division’s business plan for the recently expanded portfolio aggregating approximately 6.7 million rentable sf.
A major focus of the REIT’s business strategy will be the execution of the multimillion-dollar repositioning of the recently acquired 1.6-million-sf East Ridge portfolio. Sims has more than 36 years of real estate experience working for companies such as Olympia and York, Mendik Realty, Vornado and CB Richard Ellis.
Sims will report to Salvatore Campofranco, Reckson’s chief operating officer. He will also become a member of Reckson’s operating committee. "In Westchester and Connecticut we have the most experienced and knowledgeable team in these markets and adding David will only enhance our competitive advantage," Campofranco says. Reckson wholly owns, has substantial interests in, or has under contract, a total of 102 properties comprised of approximately 20.2 million sf.
posted by Jones Lang LaSalle NJ News Blog at 4:52 PM
April 19, 2006 -- PLANS for one of the key buildings at Ground Zero are starting to jell. The 65-story tower, referred to as "building two," will have a 200 Greenwich Street address and is being designed by Lord Norman Foster.
Foster designed Hearst's "Crystal Cathedral" and is planning two towers for RFR Holdings - one at 610 Lexington and 53rd St. by the Seagram Building, and the other on the old Sotheby's building at 77th and Madison. You can be sure all the curtain walls will be creative and unique.
We already know the base of "two" will include 130,000 feet of street and underground retail connecting directly to Santiago Calatrava's PATH station just across the new Fulton St. Responding to downtown market needs from the financial services sector, however, we've now learned that developer Larry Silverstein has Foster including "up to" five floors specifically designed for trading. These floors will be sandwiched between the retail and regular office space above, and will obviously rent for a premium.
"There's a trading floor shortage," advised one prominent broker who has seen the plans. There is, however, a design impact dating back to the original and otherwise now totally altered Daniel Libeskind Master Plan. The "Wedge of Light" has torn a triangle from the side of the building.
Sure, Silverstein has gained back any lost rentable footage going upwards to capture all of the allowed 2.4 million square feet, but it does mean smaller floors for the retail and perhaps trading levels.
The regular office floors will work fine and run from 38,000 feet at the base to 35,000 feet at the top of the tower.
The major "Wedge" impact is on the retail, which under normal circumstances would be parallel to the curb, but will be set much further back to accommodate the basically non-existent "Wedge of Light."
Sources say Silverstein and Foster have resigned themselves to dealing with the awkward geometry. A spokesperson for Silverstein declined comment. "You are distorting the shape and the functionality based on politics," said the downtown broker. "Generations to come will ask, 'Why is this wall like this?" Indeed. * Internet marketing giant Digitas signed a renewal and major expansion at 345 Park Ave. South totaling 240,000 square feet. At a mere 5.5 percent, Cushman & Wakefield's first-quarter statistics have the Midtown South vacancy rate as the lowest in the entire country. Digitas, which already has half the building, was represented by Don Preate and Frank Coco and Jamie Katcher of Cushman & Wakefield. Katcher recently won the Promising Young Broker of the Year Award from the Real Estate Board of NY. The RFR Holdings Building was repped in house by Richard Farley. The brokers declined comment but we hear the tenant negotiated early. This way it could extend its time and capture the remaining space in the building over the life of its new, 15-year deal. With over 55,000 feet expiring, American Lawyer Media would be one tenant seeking shelter in the next few years.
* A pension fund for the International Alliance of Theatrical Stage Employees (IATSE) signed a 12-year lease for 40,000 feet at 417 Fifth Ave. The paper intensive IATSE National Pension Fund will occupy the entire 3rd floor and a portion of the basement for its storage needs. Its new digs are quadruple the size of its nearby current home at 55 W. 39th St. Brian Weld of Colliers ABR, represented union's pension fund while Roxana Girandworked in-house for building owner, Murray Hill Properties.
* The Rockwell Group designer expanded an additional 5,000 feet at its longtime home at 5-9 Union Square West and renewed its lease to now occupy 40,000 feet. Matt Astrachan, Steven Bauer and Mitch Konsker of Cushman & Wakefield represented the firm lead by design maestro David Rockwell. The building, owned by Newmark Holdings had an asking rent of $42 a foot and was represented by Eric Gural in-house. The tower is now 100 percent occupied. lois.weiss@nypost.com
posted by Jones Lang LaSalle NJ News Blog at 4:50 PM
From Saltwater Taffy to Louis Vuitton By TERRY PRISTIN
ATLANTIC CITY — The shops along this city's storied Boardwalk tend to be modest establishments with names like Sully's Pizza and 99¢ Everything.
But soon, Gucci, Louis Vuitton, Burberry and Salvatore Ferragamo — brands that evoke Fifth Avenue and Rodeo Drive rather than rolling chairs and saltwater taffy — will be added to the mix. These luxury boutiques are among about 85 shops and restaurants that have signed leases at the Pier at Caesars, the gambling resort's first upscale mall, a glossy structure of three and a half stories that looks like a pale green ship jutting into the ocean. Linked to the casino by a skybridge, the pier will also house the city's first wedding chapel.
The lead developer of the pier, which is scheduled to open in June, is Gordon Group Holdings, a privately owned company in Greenwich, Conn., founded by Sheldon Gordon. Mr. Gordon created the Forum Shops at Caesars in Las Vegas, a project that seemed daring when it was built in the early 1990's. But the Forum Shops, with its gigantic talking "Roman" statues, went on to be among the top-performing malls in the nation and is credited as the catalyst for the transformation of Las Vegas into a destination for shoppers as well as gamblers.
Gordon Group and its partner, the Taubman Company, a real estate investment trust based in Bloomfield Hills, Mich., say that Atlantic City is poised for a similar metamorphosis. "This town is shifting already," said Scott Gordon, the company's president and Sheldon's son, in a recent interview in the construction trailer next to the pier. "There's enough meat on the bone for someone not interested in gambling to come here."
The pier — which received $43 million from the state Casino Reinvestment Development Authority and a $100 million construction loan from Eurohypo, a German bank that invests heavily in American real estate — will be the third heavily subsidized shopping center to open here since 2003.
That year, the Cordish Company of Baltimore opened the Walk, an outlet center in a previously drug-infested neighborhood. Another shopping center, the Quarter at Tropicana, has branches of the Palm and P. F. Chang chain restaurants, and a Las Vegas-style blue ceiling with clouds. Today, the city is awash with hotel, casino and retail expansion projects and condo developments, but Wall Street analysts say that the pier is a gamble. "I would call it fascinating, very interesting and very creative as retail goes," said Matthew L. Ostrower, a REIT analyst at Morgan Stanley, "but I would also call it high risk. They are in uncharted waters here."
Mr. Gordon concedes as much. Some of the most sought-after tenants — no more than a handful, he maintains — will not pay a set rent but will be charged initially according to the sales they generate. The developers will also absorb much of the expense of creating the stores, a cost known as tenant improvement, or T.I.
"We don't build cookie-cutter projects that make sense to a lot of people when they first see them," he said. "We like going into underdeveloped, underappreciated markets, and we know we need large T.I. before we go out and talk to tenants. We know that going to Gucci and asking them to go to a market like Atlantic City is a reach."
Though Atlantic City had almost as many visitors last year as Las Vegas did (35 million, as opposed to 38.6 million, according to each cities convention and visitors authorities), there are striking contrasts between them. About two-thirds of Atlantic City's visitors are day-trippers, while visitors to Las Vegas stay an average of 3.5 days. Tourism generates $36.7 billion for Las Vegas, but only $6.5 billion for Atlantic City.
Real estate prices in nearby suburbs have escalated, but Atlantic City (population 40,500) remains poor, with a median household income of $27,000, compared with $42,000 for the nation as a whole, according to the 2000 census. Only 10.4 percent of Atlantic City's residents are college graduates.
Mr. Ostrower said that Taubman, whose relationship with Gordon began more than two decades ago with their co-development of the Beverly Center in Los Angeles, has also hedged its risk. The partnership, announced last year, required Taubman to invest only $4 million at first. A second payment of about $20 million is not due until six months after the project opens. The final installment will equal 7 percent of the project's net operating income in 2007. "This is the way you structure a deal if you are worried about how well the property is going to do," Mr. Ostrower said.
But Robert S. Taubman, the chief executive of Taubman, said that the Gordon Group sought this arrangement to "capture most of the value creation."
There have been bumps in the road, however. As the cost of the project escalated — Mr. Gordon said the price tag is now about $200 million — the Gordon Group ran short of capital and Taubman declined to move up its payment schedule, said two participants in the negotiations.
The problem was resolved recently when Gordon got a loan of about $20 million from the Starwood Capital Group. Originally built a century ago as an amusement park known as the Million-Dollar Pier, the pier was converted in 1950 into an inward-looking shopping mall with T-shirt shops and other low-end retail. When Caesars bought the mall in 1996, the Gordon Group managed it for a few years. In 2003, Gordon signed a 75-year ground lease with Caesars, now owned by Harrah's Entertainment.
But it was not until the Borgata Hotel Casino and Spa opened in the city's marina district that summer and became an instant success that the company determined that it made sense to go after high-end retail tenants, Mr. Gordon said.
The city's first luxury hotel, Borgata has attracted a younger, more affluent crowd. "It's difficult to get in there on the weekend unless you're a rated player," said Warren J. Marr, the director of the hospitality and leisure consulting practice at PricewaterhouseCoopers, referring to serious gamblers.
Richard B. Hodos, a principal at Madison HGCD, a retail real estate consulting and brokerage company in New York, was originally skeptical about the project but wound up advising a designer to open a store at the pier. (The name of the designer has not been made public because the lease has not been signed.) "I know of no one who goes to Atlantic City," he said. "But when we looked at the average expenditure in the casinos, and the profile of the high rollers, in some cases it exceeded what we find in Las Vegas."
While the concept for the pier was inspired by the Forum at Caesars, the design was not. Rather, the goal was to take full advantage of the site, echoing the wood flooring of the Boardwalk and opening up the building to panoramic shoreline views.
"This is a different kind of mystical and romantic experience, a walk off the edge of the earth," said David P. Manfredi, a partner in Elkus-Manfredi, the architects who developed the original concept for the building and designed the exterior. (The Rockwell Group designed the common spaces.)
As a nod to the electric signs that created a sensation when they were installed on the Atlantic City piers in the 1920's, the new mall will be festooned with L.E.D. screens. A water show set to music is meant to draw visitors to the end of the long and narrow pier, Mr. Manfredi said. Talking statues, however, will be nowhere in sight. "We didn't want to create a kitschy project," Mr. Gordon said.
posted by Jones Lang LaSalle NJ News Blog at 4:49 PM
Downtown construction begins Stephanie Wynalek/Correspondent Posted: 4/19/06
Despite the delay of the College Avenue Greening Project, other redevelopment projects throughout New Brunswick are moving ahead on schedule.On the 1.3-acre French and Somerset streets location formerly occupied by Magyar Bank, which was demolished last week, AST Development Corporation will construct two mixed-use towers and an 870-space parking deck.Building plans consist of an 11-story tower along Somerset Street and a 10-story tower on French Street.
The parking deck, funded by the city, will be located in between.The bank will be relocated to a new facility down the street.The tower bordering French Street will include retail space on the first floor, 60,000 square feet of office space on the second through fifth floors, and 45 one- and two-bedroom condominiums on the other floors.The Somerset Street tower will also contain retail space on the first floor, in addition to 55 condominiums. The tower design includes a tiered structure, which will step back from the street after the third and sixth floors.According to AST Director of Development Alan Brandies, this structure is intended to permit more free space along the street."This is an effort to maintain an open feeling for the structures that are already on the other side of the street," he said.
"The idea is to create an efficient building, but to allow the sunshine to still come through to the street. We want to avoid the canal-like effect you find in New York City."Brandies said the office space in the towers is intended for medical offices, to benefit the city hospitals in close proximity to the site, but occupancy has not yet been determined."We've seen through market research that this development will help the burgeoning healthcare environment of the city," he said.
Brandies said although there has already been interest expressed in retail opportunities, AST hasn't looked into businesses yet."It's still pretty early, and we haven't really marketed the space just yet," he said. "But we're looking for businesses that will compliment the offices upstairs, possibly some coffee shops and small stores."The project is currently unnamed, and is estimated to be completed in 2008.Brandies said the parking deck will start to take shape in about six weeks, and is scheduled to be completed next spring.Parking on the new deck will be available not only to occupants of the the AST structure, but also to occupants of the nearby medical institutions.
According to city spokesman Bill Bray, the parking fees will pay for construction costs.
Brandies emphasized that the site, which is within 2,500 feet of the train station, will provide future residents with easy public transportation access."This project will provide opportunities for economic growth, increased revenue and job creation in the city, while creating more housing opportunities for New Brunswick," Mayor James Cahill said in a prepared statement."We're becoming a more pedestrian and mass transit friendly city with ample opportunities to live, work and shop."
The hydrology and environmental science firm formerly known as Geologic Services has merged with a California-based firm Kleinfelder, and the name has changed. This office expanded from 40 to 46 employees and from 8,000 to 12,000 square feet.
posted by Jones Lang LaSalle NJ News Blog at 4:46 PM
VF Corp. division VF Sportswear renewed its 96,000-square-foot lease at 40 W. 57th St. in New York City, and expanded its space by another 48,000 square feet for its Nautica and Kipling brands' headquarters, according to broker Cushman & Wakefield Inc.
posted by Jones Lang LaSalle NJ News Blog at 4:42 PM
Jersey exploring health insurance State eyes way to mandate universal coverage, like Mass. Tuesday, April 18, 2006 BY BETH FITZGERALD Star-Ledger Staff
New Jersey officials say they will explore ways to follow the lead of Massachusetts, which last week adopted the nation's first universal health insurance law.
Assemblyman Neil Cohen (D- Union) said yesterday he and Sen. Joseph Vitale (D-Middlesex) will spend the next six months meeting with employers, consumer groups, health insurance firms, hospitals, physicians, drug firms and other stakeholders to determine whether some version of the Massachusetts plan could work in New Jersey.
The law, signed last week by Gov. Mitt Romney, requires people who don't have health insurance to buy it by July 1, 2007. Employers with 11 or more employees would pay $295 a year, per employee, if the company doesn't provide insurance.
But Massachusetts has fewer than 600,000 uninsured -- well below Cohen's estimate of 1.3 million for New Jersey's -- and it's be lieved that Massachusetts has funds in place to cover the cost of the new mandate for at least the next two years.
"The toughest piece in the Mas sachusetts law is that it requires everyone to have health insurance, the same way we now require everyone with a car to have auto insurance," Cohen said. "This is going to take a lot of research and a lot of work.
"We know there are people who can't afford insurance right now, under any circumstances; there are undocumented immigrants whose names and addresses we don't even have. What is the cost, and how will the cost be borne?"
Cohen said New Jersey might consider exempting employers with 15, or 30 or even 50 workers, or perhaps use a gross revenue threshold instead.
Government subsidies would be needed to buy insurance for many of those who can't afford it now, but Cohen said taxpayers spend about $600 million a year to compensate hospitals for treating uninsured patients. "Some of those funds could be used to provide a coverage plan for the uninsured," he said.
The prospect of New Jersey tak ing a cue from Massachusetts drew a generally favorable response from several statewide business groups.
"It's a fantastic idea -- it makes sure that everyone has some responsibility in the health insurance game, and that is long overdue," said Jim Leonard, vice president for government relations at the state Chamber of Commerce. "Forcing people to take a responsible role in purchasing insurance will lead to reform, whether it's cost reform or system changes that make the system work better."
He cited a study a few years ago that found 356,000 of the uninsured had income of $50,000 or more; 200,000 were between jobs and temporarily uninsured, and 265,000 were eligible for government health plans and weren't taking advan tage of them. A key goal is getting everyone covered, "because then everyone has skin in the game, and everyone will be forced to pay attention to health insurance -- to the cost and to what is driving costs."
Phil Kirschner, president of the New Jersey Business & Industry Association, said the Massachu setts plan holds promise, though it doesn't attack the cost of health care.
"It's easy to say we're going to cover people, but what we have seen so far in the legislative response is an avoidance of the cost issue," he said.
Vitale, who chairs the state Senate health committee, said, "The goal is some form of universal health-insurance product where business, employee and government share in a partnership." He said the state-and federally funded FamilyCare program that provides health coverage to 139,000 working poor parents and 112,000 children could be a model for how universal insurance would work.
Beth Fitzgerald covers small business. She may be reached at efitzge rald@starledger.com or (973) 392-4111.
Minutes Show Policy Makers Thought Rate Moves' End Near By CAMPION WALSH and BENTON IVES-HALPERIN April 18, 2006 2:12 p.m.
WASHINGTON -- By late March, most of the Federal Reserve's monetary policy makers thought an end was likely "near" for the credit-tightening cycle begun in mid-2004, and some had concerns about tightening too much, according to Fed meeting minutes released Tuesday.
At their March 27-28 meeting, members of the Federal Open Market Committee discussed, among other things, what they saw as moderate core inflation, a cooling housing market and the possibility that their short-term interest rate hikes could have a lagged effect on the economy. "Most members thought that the end of the tightening process was likely to be near, and some expressed concerns about the dangers of tightening too much, given the lags in the effects of policy," according to the FOMC minutes, released after a normal three-week period. (See the text of the minutes.)
To head off inflation, the FOMC last month raised its overnight interest rate target for the 15th straight time since mid-2004, taking it to 4.75%. Financial markets widely expect the FOMC will raise the rate target to 5% at its next meeting, May 10. The outlook for future meetings is far less clear.
The March FOMC meeting was the first presided over by Fed Chairman Ben Bernanke. The decision for another gradual interest rate hike and the language of the accompanying statement suggested little change of direction following Alan Greenspan's tenure.
Yellen Emphasizes Data
Earlier in the day, a top U.S. central banker said that what the Fed does next will be driven by economic data, in an addresses that laid out expectations of solid growth and contained inflation. Federal Reserve Bank of San Francisco President Janet Yellen said "enough has been done by now that I view decisions about the path of policy going forward as quite data-dependent." She noted that the current stance of monetary policy -- the overnight fed funds target is currently at 4.75% -- is "close to a neutral stance" in terms of its economic impact.
The bank president, who is a voting member of the Federal Open Market Committee, spoke in comments prepared for delivery before a local business group in San Jose, Calif.
The economic outlook outlined in Ms. Yellen's speech was generally positive, predicting sustained economic growth and restrained inflation pressures. But she also noted that her forecast was bounded by a number of risk factors.
Ms. Yellen spoke in advance of the release of the meeting minutes for the March 27-28 FOMC meeting. At that meeting, central bankers indicated a continued preference for more rate tightening. Financial markets believe the Fed will stop hiking rates at 5% at its May 10 meeting, and are looking to the minutes to see how deep policy-makers' desire to raise rates actually was. In her speech, Ms. Yellen explained that with monetary policy now so closely tied to the economy, she will be on guard to see how incoming statistics jibe with her forecast of economy's expected path. She added it's also important to keep in mind the lagged impact of past rate increases.
Ultimately, "I would not want to prejudge future decisions to raise rates -- or to hold them steady -- but rather I will be highly sensitive to the implications of incoming data for the forecast for economic growth, employment and inflation," she said.
In terms of how events are likely to play out, the growth outlook "is essentially pretty positive," Ms. Yellen said. "The economy appears to be approaching a highly desirable trajectory" and will be "supported by strong productivity growth and continued strength in consumer spending and business investment, especially investment by the vital high-tech sector," she said.
Part of what will bring the economy back to this pace is the Fed's "gradual removal" of monetary policy stimulus, which will be "reinforced" by "a significant moderation in the rate of appreciation of house prices."
Inflation "appears to be well contained at present, and my best guess for the future is that it will remain well contained," Ms. Yellen said. But she added, "there are risks, and I think they are tilted slightly to the upside." Ms. Yellen noted inflation as measured by the core personal consumption expenditures price index, which strips out food and energy costs, now stands "in the upper portion of my comfort zone."
While labor market and energy related factors could exert pressure on the inflation situation, Ms. Yellen added that what are now "well anchored" inflation expectations held by markets reduce that threat.
She added the economy, at the current unemployment rate of 4.7%, "is now operating in the vicinity of "full employment'" and stands a very good chance of remaining at that level of utilization. Ms. Yellen noted that labor compensation, despite some anecdotal indications that suggest otherwise, does not appear to be rising fast enough to suggest the labor market is overheating and creating an inflation problem by itself.
Ms. Yellen said in her speech that one of the big risks to the outlook comes out of the housing market, which could easily surprise with stronger- or weaker-than-expected price gains. But as things now stand, "the early signs of cooling in U.S. housing markets are broadly consistent with the degree of moderation I've envisioned."
Another risk to the outlook results from the still unusually low level of long-term interest rates, which Ms. Yellen admitted remain hard to explain. She noted that while yields on long-dated Treasury bonds have risen of late, "it's too soon to tell" whether that means the market will help restrain economic growth.
The central banker also said energy prices are a risk to the outlook, despite the economy's resilience to gains thus far. "My assumption, based on the forecasts embodied in futures markets, is that energy prices will stabilize around their current levels" and if that proves true, their negative impact on spending should "dissipate" over the current year, which in turn would be a plus for economic growth, she said.
Still, Ms. Yellen cautioned that predicting the direction of energy prices is an effort "fraught with uncertainty." Her comments come at a time where energy markets have been surging, in part due to geopolitical uncertainties, pushing oil futures prices to record highs. --Michael S. Derby contributed to this article.
Write to Campion Walsh at campion.walsh@dowjones.com and Benton Ives-Halperin at benton.ives-halperin@dowjones.com
posted by Jones Lang LaSalle NJ News Blog at 4:25 PM
Biotech park to get under way Developers break ground today on $120 million East Baltimore life science center By Rona Marech Sun reporter Originally published April 17, 2006
The plans have been laid, the residents relocated, the land cleared, and at long last - after a ceremonial groundbreaking event today - construction is set to begin on the first building in a new biotech park that supporters hope will transform East Baltimore and the city. The new building, which developers expect to be completed by 2008, is a six-story, 282,000-square- foot, $120 million life science center bounded by Wolfe, Chapel and Madison streets and Ashland Avenue. It is part of the first phase of the renewal project, which is to extend over 31 acres and include five life science buildings as well as three parking garages, 900 units of housing, 40,000 square feet of retail space and several acres of new parks.
The Johns Hopkins University plans to lease one-third of the space in the new building and the developer, Forest City-New East Baltimore Partnership, hopes private companies will move into the remainder.
"This groundbreaking has been several years in the making and represents a significant milestone in terms of not only East Baltimore's continuing redevelopment, but for the city and the region's economic future as well," said Jack Shannon, president and chief executive of East Baltimore Development Inc., the nonprofit organization the city established to oversee the renewal project. Over the summer, developers will turn to construction of a low-income residential building for seniors and another apartment complex.
The coalition behind the effort envisions a post-industrial Baltimore, where disappearing manufacturing jobs are replaced with new biotechnology jobs. The project will be boosted, proponents say, by the proposed park's proximity to the region's top medical research institutions, an educated work force, and the city's location near Washington, Philadelphia and Boston.
The development of the entire 80-acre site will take 12 to 15 years to complete and cost $1.2 billion. Project partners are planning parks, transportation, offices and retail space, as well as school classrooms and about 2,000 units of mixed-income housing.
"Over time, obviously, we'll be creating a neighborhood where the housing will have a greater density to it compared to what existed before we began our work," Shannon said. The housing will include rowhouses, apartment buildings, condominiums and housing for students. It has been a long journey just to reach the groundbreaking stage. Already, 394 households and 20 businesses have been relocated with assistance from EBDI. The development organization connected residents with family advocates and provided homeowners an average of $150,000 in financial benefits and renters close to $40,000.
Last year, the Annie E. Casey Foundation funded a survey by an independent evaluator to determine whether relocated families were satisfied with the moving process. A majority of respondents indicated they were better off in their new homes and neighborhoods and rated their overall relocation experience as good or excellent.
But not everyone is content about the process.
"Where's the long-term stability in it?" said Donald Gresham, chairman of the Save Middle East Action Committee. He's worried that because of the rising cost of real estate, former residents won't be able to afford their new housing once the assistance runs out. He also expressed concern that residents won't have access to the new jobs being created, that those who want to move back won't be able to and that the community's history will be lost.
"If the people are not benefiting from the change, what good is it?" he asked.
These concerns are legitimate, said Douglas Nelson, president of Annie E. Casey Foundation and a member of the EBDI board. However, his foundation has already contributed $10 million to help residents and expects to spend substantial amounts in the future to avoid the kind of problems Gresham foresees.
While homeowners who have moved may be paying more in property taxes, many live in more valuable homes that they own debt-free, he said.
Moreover, the plan is to offer former residents - in addition to replacement housing - access to jobs, financial education and career development opportunities. EBDI has already invested in training programs, such as the BioTechnical Institute of Maryland's Biostart program, which trains high school graduates in the life sciences.
Nelson also said he expects to see displaced families move back.
"This will be a failure from my point of view, and Casey's, if we can't keep this neighborhood affordable to many of the people who used to live there or to other low-income families that want to move in the future," he said.
Around the country, most viable urban-renewal developments haven't included low-income residents in their long-term plans. Nelson hopes the biotech park will provide a better blueprint, he said. "An urban renewal project that is friendly to low-income people and remains so when it's successful."
rona.marech@baltsun.com
posted by Jones Lang LaSalle NJ News Blog at 4:24 PM
Indian Biotech industry to cross $ 5bn by 2010, study says Monday, April 17, 2006 17:00 IST Our Bureau, Mumbai
Inherent 'India Advantages', growing investments by established business houses, favorable government stance and significant interest of the international community are likely to ensure that the Indian Bio-Technology sector will cross revenues of USD 5 billion in the next four years, according to a research report by leading investment bank Avendus Advisors.
The report points out that India has inherent strengths like a large pool of qualified scientific talent, several research labs and R&D institutions and strong IT skills. The country also possesses rich human, plant and microbial bio-diversity offering a great base of genomic and pharmaco-genomic studies for drug discovery.
Growth in the sector is expected to come on the back of increased partnering activity, transition to a product model, growth in bio-generics market and government initiatives to encourage investments and expansion in the sector, the report says.
Besides revenues of USD 5 billion, by 2010, the biotech industry in India is expected to generate over one million skilled jobs and have a 10% share of the global industry, the Avendus report says adding, "India is now among the top five biotechnology hubs in the Asia Pacific region in terms of attractiveness for investment in this sector."
The report points out that global pharmaceutical and biotech industry faces several challenges including increasing regulatory restraints, stagnant product pipelines and high R&D costs. Against this backdrop, global pharma majors are increasingly looking for low-cost suitable alternatives for R&D and manufacturing. "India with ample opportunities available to be capitalized on without compromising on quality," seems like the ideal low-cost destination, the report says.
Bio-pharma with revenues of USD 811 million accounts for three fourths of the Indian biotech market and has registered a growth of 30% growth driven particularly by the vaccine business. In fact the Avendus report points out that India is emerging as the vaccine hub of the world, with one of the every two children in the world being immunized by vaccines made in India. Companies like Serum Institute, Panacea Biotec and Shanta Biotech are at the forefront of this revolution, the Avendus report says.
India is also being taken increasingly seriously as a biotech-outsourcing destination with revenue from work outsourced by Western companies accounted for more than 13% of India's biotechnology exports of USD 395 million during 2004.
Another trend the report identifies is that of custom research helping Indian biotech start-ups generate early cash flows. Typically such cash flows are used to fund infrastructure and scientist salaries till the companies gather critical mass to move on to product development. "There also exist opportunities to move up the value chain through discovery-led research programs on shared IPR and milestone payments," the report says.
posted by Jones Lang LaSalle NJ News Blog at 4:12 PM
State to fund 3-mile bypass in Sayreville $10M project expected to help ease traffic congestion Tuesday, April 18, 2006 BY NAWAL QAROONI Star-Ledger Staff
Traffic congestion in Sayreville might be alleviated one day with the creation of a 3-mile east-west bypass, fully funded by the state over the next five years, officials announced yesterday.
A total of $10 million -- $2 million annually -- has been earmarked for the borough's Main Street Bypass in the state's transportation capital plan. The project was estimated to cost about $12 million, said engineer Jay Cornell, partner at CME Associates, but several developers are building por tions of the bypass as part of their contracts with the borough.
Assemblyman John Wisniewski (D-Middlesex), who is also the borough's Democratic chairman and the chairman of the Assembly Transportation Committee, said he lobbied hard for the state funding.
"This bypass will serve a state purpose, too, not just a localized one," Wisniewski said at a press conference yesterday. "If you're traveling north from the Milltown area, you can cut through Sayre ville. It will serve as a supplement to state highways Routes 1 and 9."
Brendan Gill, spokesman for the State Department of Transportation, said the project will be locally managed even though the money is coming from the state.
"We have the ability to fund projects which we feel are critical to our mission to help relieve congestion and promote safety," Gill said. "This project fits that crite ria."
Council President Thomas Pol lando said a connector roadway that would take cars off the borough's most used streets, Main Street and Washington Road, has been in the master plan for 20 years.
"The inability of the borough to finance it kept us from making it a reality," Pollando said. "This is a way for us to keep moving forward, and it's really great for our town."
The project is still in preliminary stages. The next two to three years will be spent designing it, getting permits and securing rights-of-way. That means residents probably won't see actual construction until 2009, said borough engineer David Samuel, of CME Associates.
Samuel said the bypass most likely will begin near River Road and connect with Chevalier Avenue near the National Lead property. It could lead directly to Victory Circle, which is at the end of Chevalier, putting vehicles directly on Routes 9 or 35 or the Garden State Parkway. The developers that are building portions of the bypass include the Neptune developers; Wick Builders, as part of Sheffield Town on Wilkshire Boulevard, and the Coastal Group, as part of the Winding River project.
Other through streets in the borough, such as Ernston Road, Glynn Court and Sayreville Boulevard, a street built in conjunction with the Town Lake development, have recently been opened in efforts to clear traffic density in the north-south direction.
The decision to open Battista Court as another north-south connector was met with opposition months ago, as many residents lamented the traffic it would put on their quiet side street off Deerfield Road. But Battista Court is ex pected to open in the next couple of months, too, said Cornell.
