Todd Murphy's Law

Nonresidential Building Index At 3 - Month Low

BOSTON (Reuters) - A leading indicator of U.S. nonresidential construction spending dropped to its lowest level in three months in August as developers continued to find it tough to finance new projects.

Corzine freezes approvals for development projects in corrupt towns.

In his boldest play yet to force the resignation of Ridgefield's mayor, Gov. Jon Corzine signed an executive order today freezing state approvals for development projects in any city or town where a mayor has been charged with public corruption but refuses to step down.

Read more here.

Friday deadline set for proposals on Fort Lee tract

FORT LEE — Friday is the deadline for developers to submit proposals to the borough for a chance at constructing a mixed-use project on the last large piece of vacant land in town.

Those interested in the project have until 4 p.m. for their applications to reach Borough Attorney Lee Cohen.

Copies of all proposals will be kept in the borough clerk’s office for residents to review, Mayor Mark Sokolich said.

The redevelopment project, locally known as Centuria, the name of a failed project at the site, will sit on 15.7 acres that have been empty for more than 30 years. Borough officials have said that redevelopment of the tract is the linchpin of downtown revitalization.

Sokolich met this morning with several borough officials, including borough planner Paul Phillips, “to establish a protocol to review the proposals,” he said.

After reading the submissions, the council will “provide a summary analysis” and then take action, Sokolich said.

He cautioned, however, that borough officials will not approve any application just to have the development built.

“We need to exercise all possible diligence to ensure that we do not select the wrong developer,” Sokolich said. Choosing correctly is his “most significant role as mayor, as it pertains to this project,” he said.

Some of the biggest names in national and international real estate attended a mandatory April meeting, but it is unknown who will submit a proposal.

Town & Country Developers at Fort Lee was removed as the official site redeveloper in May 2008, after the company failed to pay taxes. The tract, bounded by Lemoine Avenue, Central Road, Main Street and Bruce Reynolds Boulevard, has been vacant for more than 30 years.

Borough officials are scheduled to choose a developer Sept. 10 and complete the redevelopment agreement by Jan. 15.

NJ's Governor Signs Economic Stimulus Bill

Trenton, July 27, 2009. Governor Jon Corzine signed into law NJ's economic stimulus law.  The law is very complex but for developers, there are three key points which may benefit us.

1. An overhaul of the Urban Transit Hub Tax Credit program which will allow mixed-use projects, consisting predominantly of residential units, to receive tax credits.  Under the revamped program, companies will be eligible for a 100-percent corporate business tax credit for mixed-use projects investing at least $50 million and creating or relocating at least 250 jobs within a half-mile of mass transit stations in Trenton, Newark, New Brunswick, Paterson, Elizabeth, Hoboken, Jersey City and East Orange. In Camden, that radius is one mile.

2. The law establishes the Economic Redevelopment and Growth Grant program (ERGG) to provide developers with better resources to fill financing gaps in redevelopment projects.  ERGG will give municipalities the ability to finance redevelopment efforts through revenues derived from a site's redevelopment rather than through local borrowing.  Under ERGG, a developer is required to contribute his or her own capital for at least 20 percent of the project total cost.   

3. The law exempts projects that received site plan approval before July 1, 2010 from non-residential development fees – as long as a construction permit is issued prior to January 1, 2013.  Municipalities are required to refund any fees which have already been paid for projects which meet these requirements.

Download a copy of the bill as signed at: http://www.njleg.state.nj.us/2008/Bills/A4500/4048_U2.PDF)

NJ to return 2.5% affordable housing fee

Gov. Jon S. Corzine is expected today to sign legislation that will give developers back the millions of dollars they were taxed to pay for affordable housing.  The tax, enacted last year to aid Corzine in reaching his goal of building 100,000 affordable homes, was widely criticized by Republican legislators who complained that the fee was unfriendly to business and towns criticized it as byzantine and unworkable.

The legislation, which is part of the New Jersey Economic Stimulus Act of 2009, returns the collected money to developers. In addition, it earmarks $15 million toward affordable housing. Towns that previously enacted their own housing fees can keep the difference between theirs and the state rate. The new law allows developers to avoid paying any development fees as long as they get preliminary project approvals by July 2010 and build them by 2013.

TM

The odds are in favor of mixed-use projects with retail, but dated zoning and sluggish approval process must be navigated

Towns need development to generate much needed tax revenues and businesses need places to develop.  So, why is it so hard to get approvals?

Interesting Article in Real Estate New Jersey

New Jersey Shore Builders Ass'n v. Township of Jackson LAND USE AND PLANNING - Set-Asides

Held: The Municipal Land Use Law does not empower municipal governments to require developers to set aside land for common open space or recreational areas, except with regard to applications for planned developments as defined in the Municipal Land Use Law. The order of the trial court in the Jackson Township case is affirmed, and the order of the trial court in the Egg Harbor Township case is reversed.

Download the case here.

Lennar's Strategies Shave Home Inventory

Creative sales strategies helped Lennar Corp. blow through unsold inventory and beat the Street's revenue estimate, but they weren't enough to narrow the quarter's loss. The builder also now has fewer homes to sell going forward.

Still, the Miami-based builder's stock soared Wednesday, jumping $1.37, or over 17%, to $9.19 in 4 p.m. New York Stock Exchange composite trading.

Read the entire article here.

McMansions Out of Favor, for Now

A new study out Monday by the American Institute of Architects shows that Americans have fallen out of love with McMansions. The 500 residential architects surveyed said that only 4% of their clients wanted more square footage in their homes this year, compared to 16% last year.

This desire isn't surprising, given both the recession and the fact that the most recent U.S. Census shows that there are 77 million people in the "empty-nester" phase of life, from ages 45 to 64, and 61 million in the first-time buyer category, from 20 to 34.

So at least for the near future, empty-nesters and young adults will dominate the housing market. The question is, will smaller, more affordable housing be there for them?

Read the entire article here.

N.J. Assembly committee approves moratorium on fee for commercial developers

The moratorium was included in a bill released today by the Assembly Appropriations Committee. The 2.5 percent development fee, proceeds of which were to be used to help fund affordable housing, was signed into law last summer. But Gov. Jon Corzine and key lawmakers have since called for it to be suspended, citing the slumping economy.

The bill also would expand a transit hub tax credit and allow colleges and universities to partner with private developers to construct buildings such as dormitories and cafeterias that would be paid for through revenue the facilities generate.