Sitex Group’s 271 KSF Facility in NJ Finds Tenant
The newly completed facility is close to major thoroughfares, most notably Route 17 and interstates 87 and 287. NAI James E. Hanson arranged the long-term lease with a tools manufacturer.
by Tudor Scolca | Apr 24, 2018
National Industrial News
More
Facebook
Twitter
Google+
LinkedIn
Email
Subscribe to CPE

Rendering of One Sharp Plaza
Snow Joe DC, a lawn and garden tools manufacturer, has signed a long-term lease at Sitex Group’s 271,176-square-foot spec warehouse property in Mahwah, N.J. NAI James E. Hanson marketed the recently completed One Sharp Plaza on behalf of the landlord.
The Bergen County industrial facility is located at 100 Performance Drive, within Stateline Business Park, sitting on approximately 21 acres. Petillo Inc. was the general contractor for the project. According to Yardi Matrix data, developer Sitex Group received a $22 million construction loan from Santander Bank for One Sharp Plaza.
The facility features a 36-foot clear ceiling height, 54- by 60-foot column spacing, 36 dock doors, ESFR sprinklers, two drive-ins and parking space for 25 trailers and 184 cars. The warehouse also comes with exclusive signage rights in the form of a 10- by 48-foot pylon with visibility from Interstate 287.
Major transportation hub
One Sharp Plaza is within minutes of major thoroughfares, such as Route 17 and interstates 87 and 287. The distribution hub is less than an hour’s drive from New York City. Other points of interest within reach include the George Washington and Tappan Zee bridges, the Newark and Stewart airports and Port of Newark, all under 40 miles away. Interstate 287 has an annual average daily traffic count of more than 115,000 vehicles.
“With record property prices throughout much of Bergen County and a highly limited supply of state-of-the-art buildings, submarkets like Mahwah present industrial users with an ideal mix of location, flexibility and access to a highly skilled workforce that make this area a perfect location for companies like Snow Joe,” said NAI Hanson Senior Vice President Kenneth Lundberg, in a prepared statement.
Lundberg and Associate Patrick Lennon represented Sitex in the lease negotiations, while Chaus Realty’s Brian Scheuer worked on behalf of the tenant.

NEWARK, NJ — Amazon representatives met with local community leaders in Newark on Tuesday to “fine-tune” the city’s pitch to land the retail giant’s new headquarters, dubbed HQ2.

Aisha Glover, president and CEO of the Newark Community Economic Development Corporation, told Patch that New Jersey and Newark officials met with the Amazon HQ2 selection team to “fine-tune elements included in our pitch” and give the company a first-hand look at the city.

“Suffice it to say, we hope the same compelling case that earned Newark recognition as one of 20 candidate cities from more than 200-plus proposals will help bring this home to New Jersey at the end of the day,” Glover said.

She declined to comment further on the views and reactions of the Amazon team in order to “respect the integrity of their selection process.”

Sources told NJ Advance Media that attendees at the meeting included Gov. Phil Murphy, Mayor Ras Baraka and local businessman/philanthropist Ray Chambers.

See related article: Newark A Finalist For Amazon HQ2, Company Announces
See related article: SNL Lampoons Newark’s Odds Of Landing Amazon HQ (Video)
Amazon has stated that the new facility will be a “full equal to its current campus in Seattle.” The company said that it expects to invest over $5 billion in construction into the new headquarters and that it may bring as many as 50,000 “high-paying jobs” to the area.

The project could generate an estimated $10 billion in direct and indirect economic activity, according to a company news release.

Amazon listed some criteria for the new location. It needs to be in a metropolitan area, in a stable and business-friendly environment, close to world-class universities and to transportation infrastructure, and with optimal connectivity to the internet.

The race to land the new facility has inspired proposals from more than 238 communities. According to Amazon, the other locations that are among the final 20 candidates are: Austin, TX, Chicago, IL, Columbus, OH, Dallas, TX, Denver, CO, Indianapolis, IN, Los Angeles, CA, Montgomery County, MD, Nashville, TN, New York City, NY, Northern Virginia, VA, Philadelphia, PA, Pittsburgh, PA, Raleigh, NC, Toronto, ON, and Washington D.C.

See related article: Amazon HQ2: Shortlist Of Candidates Announced
The proposal to bring Amazon’s new headquarters to Newark has lined up supporters on both sides of the political spectrum, including former governor and Republican Chris Christie and Democrat U.S. Senator Cory Booker.

“This deal would amount to one of the most successful endeavors in the history of New Jersey and Amazon,” Christie said last year. “For New Jerseyans, HQ2 means 50,000 new jobs and the creation of a larger consumer base and direct opportunities for local small businesses and vendors to grow and thrive. Adding tens of thousands of dedicated and community-oriented Amazon employees and their families will also further enrich our area neighborhoods and schools.”

See related article: ‘Bring Amazon HQ To Newark’: Christie, Democrats Agree
However, some critics have questioned the plan to offer the corporation a tax break through the state Economic Development Authority (NJEA) that could reach $5 billion over 10 years. Newark city officials are also offering the company a municipal property tax abatement that could be worth $1 billion, as well as a city wage tax waiver worth an estimated $1 billion over 20 years.

The headquarters project would be required to create at least 30,000 new full-time jobs and represent a capital investment of at least $3 billion to earn the tax credits. The project would also be required to yield a net benefit to the state of at least 115 percent of the tax credits the company receives, according to a release from the state Senate.

State Assemblyman John Wisniewksi, a Democrat from District 19, said that the Amazon “bidding war” will only put New Jersey on a downward spiral.

“While the proposal would provide good jobs in the region, it also robs the state of the very revenue needed to address the consequences of such growth and development,” Wisniewksi said.

“If we add 50,000 employees to downtown Newark, where’s the money to maintain and expand the system?” Wisniewksi questioned. “Who would pay for the additional wear and tear on roads or the additional police and firefighters needed to ensure public safety?”

Is waste management station an issue?
Garbage is shown at the Waste Management Inc. transfer
Garbage is shown at the Waste Management Inc. transfer station in Hillsdale, Thursday, March 1, 2018. (Photo: Kevin R. Wexler/NorthJersey.com)

One business that doesn’t fall into the vision some officials have for the industrial zone is Waste Management, Inc. — a 5-acre waste transfer station on Brookside Place.

“Who’s going to want to redevelop this area with a waste transfer station in the middle of it?” Mayor John Ruocco said.

The company recently resumed operations after halting for several years in 2014 due to a partially collapsed roof.

Borough officials have challenged the state Department of Environmental Protection’s decision to reissue Waste Management’s Solid Waste Facility Permit. The borough claims the Hillsdale location is inappropriately placed, bringing loud noises, foul smells and heavy truck traffic through the center of the borough’s downtown and near residential areas.

A man works on a truck, at the Waste Management Inc.
A man works on a truck, at the Waste Management Inc. transfer station, in Hillsdale, Thursday, March 1, 2018. (Photo: Kevin R. Wexler/NorthJersey.com)

But John Hambrose, communications manager for Waste Management, said the station is “tucked into a commercial/industrial district that is hardly in the center of Hillsdale.”

The Bergen County Utilities Authority is currently reviewing the county’s solid waste management plan and borough officials are hopeful it will deem the Hillsdale site redundant. After all, they say, the station was closed for several years and the company was able to get along without it.

But Hambrose said the location provides “essential and convenient” services to the county.

Residents near the industrial zone say they would rather see “anything except garbage” in Waste Management’s place.

The Waste Management Inc. transfer station, in Hillsdale,
The Waste Management Inc. transfer station, in Hillsdale, is located near the intersection of Patterson St. and Piermont Ave. Thursday, March 1, 2018 (Photo: Kevin R. Wexler/NorthJersey.com)

The bad smell
Bill and Sue Monahan have lived on Piermont Avenue, just across the railroad tracks from Waste Management, for more than 40 years. When they moved in, they say the site, which was operated by another company at the time, was used for truck parking, then cardboard collection.

But since it started handling garbage, quality of life has severely declined, the couple says.

“We’re impacted by the noise and the smell, especially the smell – in the summer it’s unbearable,” Bill Monahan said. “Plus you have 18-wheelers going through out town, which is not the safest thing.”

Bill Monahan, has lived on Piermont Ave. in Hillsdale
Bill Monahan, has lived on Piermont Ave. in Hillsdale for more than 40 years, and is not happy with Waste Management Inc. and the transfer station located on his street. Thursday, March 1, 2018 (Photo: Kevin R. Wexler/NorthJersey.com)

Michael Wowkun, also a Piermont Avenue resident, said the smell is so intrusive, he can’t have people over for a barbecue, or keep his windows open. A fan in the facility hums from daybreak until evening, he said, driving him “nuts.”

“It’s a horrible quality of life living there,” he said.

Councilman Zoltan Horvath, who also lives nearby Waste Management, agreed, calling the quality of life in the area “abominable.”

“We pay high taxes and we don’t enjoy the peace and quiet that everyone else in town does,” he said. “This station should not be here, it should be on a major highway.”

Redevelopment area qualifications
Under the Local Redevelopment and Housing Law, a property must meet certain qualifications to be deemed an “area in need of redevelopment.”

These include:

Buildings that are substandard, unsafe, unsanitary, dilapidated, becoming obsolete, lack light, air, or space and create unwholesome living or working conditions.
Discontinued use or abandoned buildings previously used for commercial, manufacturing, or industrial purposes.
Areas with buildings or improvements detrimental to the safety, health, morals, or welfare of the community because of: dilapidation, obsolescence, overcrowding, faulty arrangement or design, lack of ventilation, light and sanitary facilities, excessive land coverage, deleterious land use or obsolete layout.
A growing or total lack of proper use of areas caused by property ownership issues that impede land assemblage or discourage the undertaking of improvements that result in a stagnant and unproductive condition of land that’s potentially useful and valuable for contributing to and serving the public health, safety and welfare of the surrounding area or the community in general and is presumed to be having a negative social, economic or other detrimental impact to the same.
Areas greater than five acres whereon buildings or improvements have been destroyed by fire or natural disaster.
The designation of the delineated area is consistent with smart growth planning principles adopted pursuant to law or regulation.

HACKENSACK, NJ—Kushner Companies has acquired Prospect Place, a 360-unit, two-building multi-housing property in Hackensack, NJ. Industry observers familiar with the property say the purchase price was around $100 million.

Holliday Fenoglio Fowler marketed the property exclusively on behalf of the property owner, who was not identified. However, Real Capital Analytics, a proprietary transaction database, indicates that the property’s most recent owner was a joint venture of Goldman Sachs, Greystar, and Ivanhoe Cambridge, which acquired the asset in January 2013 for nearly $99.2 million as part of a 27-property Equity Residential Apartment Portfolio. HFF says Kushner purchased the property free and clear of existing debt.

The HFF investment advisory team representing the seller included senior managing director José Cruz, managing director Kevin O’Hearn, senior directors Michael Oliver and Stephen Simonelli and director Marc Duval.

“Prospect Place represents the right mix of infill Northern New Jersey multifamily product with renovation upside,” Cruz says. “Its Bergen County location with direct access to New York City attracts a wide array of tenants.”

Prospect Place, 300 and 310 Prospect Avenue, offers convenient access to the New York City metropolitan area via the nearby NJ Transit Anderson Street station and Interstates 80 and 95. The two-phase property consists of an 18-story high-rise comprising 157 units averaging 1,331 square feet and a four-story mid-rise building comprising 203 units averaging 1,077 square feet. Community amenities include an outdoor lap pool with sundeck, landscaped courtyard, grilling stations, fitness centers, billiards room, resident lounges, concierge service and 653 covered parking spaces. Prospect Place is 96-percent occupied.

PENNSAUKEN, N.J. — Colliers International has negotiated the sale of three industrial buildings in Southern New Jersey for a combined $7.5 million. The three properties located in Pennsauken include: 9240 Commerce Highway, a 67,600-square-foot warehouse acquired by a private investor for $3.2 million; 6995 Airport Highway Lane, a 60,800-square-foot manufacturing facility purchased by Heat Makers Sense for $2.7 million; and 9265 Commerce Highway, a 33,500-square-foot warehouse acquired by Draco Broadcast for $1.6 million. The seller was the Bloom Organization. Ian Richman and Marc Isdaner of Colliers arranged the sale of the three properties.

Weiss Realty Acquires 48,492 SF Office Building in Neptune, New Jersey, for $8.6M
POSTED ON DECEMBER 18, 2017 BY AMY WORKS IN NEW JERSEY, NORTHEAST, OFFICE
1800-1836-W-Lake-St-Ave-Neptune-NJ

Hackensack Meridian, the Department of Treasury for the State of New Jersey and West Lake Pharmacy are tenants at the 48,492-square-foot office building located at 1800-1836 W. Lake Ave. in Neptune, N.J.

NEPTUNE, N.J. — An affiliate of Weiss Realty has acquired an office building located at 1800-1836 W. Lake Ave. in Neptune for $8.6 million. James Gunning, Donna Falzarano and Kyle Saviano of CBRE Capital Markets Debt and Structured Finance arranged a $6 million permanent loan from Natixis of behalf of the buyers, West Lake Neptune LLC and West Lake Neptune 11 LLC, for the acquisition. Built in 2010, The three-story building offers 48,492 square feet of office space. Current tenants include Hackensack Meridian Health, the Department of Treasury for the State of New Jersey and West Lake Pharmacy. Fred Meyer of NAI Mertz and Jack Sudia of NAI Atlantic Coast Realty brokered the transaction. The Meyner and Landis Law Firm of Newark, N.J., represented the undisclosed seller, while Saverio Celeste of Fort Lee and William Schmidt of West Orange represented the buyer in the deal.

NJ Warehouse Market at Historic Levels

The growth of online shopping, which is stretching package delivery systems across the U.S., is sparking a frenzy in New Jersey’s commercial real-estate market.

Despite a feverish pace of construction in recent years, tight inventories and surging demand are driving rents for New Jersey warehouse space to new highs, according to a report from CBRE Group Inc.

By the third quarter of this year, developers added about 7.8 million square feet of space, 83% more than in all of last year, according to CBRE. By the end of 2017, new industrial space completed is expected to reach 11.2 million square feet, more than twice the amount built in 2016 statewide.

Rents have been on an upward march since 2012, surpassing a 2004 high of $6.23 a square foot last year and reaching $6.64 in the third quarter of 2017.

The demand for space isn’t expected to let up anytime soon, real-estate brokers and consultants said, and so rents could keep rising.

Demand for New Jersey Warehouse Space Skyrockets
Behind the growing demand, in addition to online shopping and the drive for faster deliveries, is the ability of larger ships to get to local ports, expansion of food and beverage delivery, and displaced warehouse tenants from New York, said Bill Waxman, an executive vice president at CBRE.

“It has been nonstop,” he said of businesses’ hunt for space. “From paper companies to packaging companies to internet sellers, brick-and-mortar sellers…everybody is looking at their supply chain. New Jersey is unique in its location and ability to service a huge consumer zone.”

New Jersey’s real-estate market is being swept up in a sea change that is reshaping the U.S. retail sector as online shopping gains ground. Department-store chains and clothing retailers have been among the most prominent casualties, shuttering thousands of store locations across the U.S. in recent years, leading mall landlords to scramble for new tenants.

NJ Transit wanted the land for its plan to build a tunnel connecting New York and New Jersey. After the project was canceled, the family of a reputed mobster that owned the land wanted the money.

Now the family of Carmine “Papa Smurf” Franco have gotten a nice payout from the transit agency to help settle the dispute: $6.13 million, according to a settlement agreement NJ Transit.

The settlement ended a seven-year dispute with Franco’s family since the land was condemned for the rail project, which was supposed to double the train capacity between New York and New Jersey. The project was canceled by Gov. Chris Christie in October 2010. Much of the money was expected to be distributed through wire transfers by Sept. 1.

NJ Transit said it approved the settlement with Franco’s family four months ago. NJ.com made the settlement public in an article this week. NJ Transit confirmed the settlement to Patch and emailed a copy of the agreement.

The 1.89-acre tract is located on the border of Hoboken, Weehawken and Union City. The two sides fought in court over the land that was valued at $8.15 million.

Subscribe
Franco, a 77-year-old Genovese Crime Family associate, has long been suspected of having mob ties and was once banned from the trash business in New Jersey, court papers said. In 1998, he was sentenced to prison and agreed to pay $11.5 million to the state and Bergen County for illegally carting trash out of state.

Franco was then busted in 2013 for being the ringleader of a scheme to control crooked waste management companies, law enforcement officials said.

Franco was one of 32 people in New York and New Jersey charged in the FBI-run takedown that included members of several crime families, authorities said. Franco was allegedly at the center of a scheme involving three well-known mob families, the Genovese, Gambino and Lucchese crime families.

According to U.S. Attorney’s Office release, Franco was one of 12 people who controlled crooked waste management companies that were officially owned by people who had no past ties to organized crime, who were known as “controlled members.” He was later convicted in 2014 and served a year in jail.

The U.S. Senate and House of Representatives on Monday began the grueling process of hashing out the disparities between their tax bills — a task that will require reconciling hundreds of billions of dollars in differences.
The two versions of the legislation are a bit of a mixed bag for the real estate industry — disproportionately favoring the commercial sector over residential. Limited liability companies (LLCs) and real estate investment trusts win big under both. Homeowners? Not so much.
Heidi Learner, chief economist of Savills Studley, warned that the benefits will likely come at a cost. After all, the $1 trillion that is expected to be added to the federal budget deficit — as estimated by the Joint Committee in Taxation — will need to be made up for elsewhere.
“From the commercial front, the treatment is quite favorable,” Learner said. “But any perks could be offset by higher interest rates.”
The Real Estate Board of New York has also spoken out against the elimination of the federal deduction of state income taxes, and has voiced concerns over the impact the House’s version will have on affordable housing construction.
“The tax reform legislation under consideration contains elements that will promote economic growth and job creation,” REBNY President John Banks said in a statement. “There are several issues, however, with which we remain deeply concerned.”
Here are the issues that will most dramatically impact the real estate industry:
1. Pass-through deductions
The biggest developers and investors in New York City, Los Angeles and Miami rely extensively on LLCs and partnerships. For this reason, the increase in tax cuts for pass-through entities — which don’t pay income taxes at the corporate level — is likely a significant boon to the industry. The House version caps the pass-through rate at 25 percent, down from the current 39.6 percent. The Senate version allows such businesses to exclude 22.4 percent of their income from taxes.
“This could certainly cause a lot of people to rethink how they structure their business,” Learner said. She noted that more owners may opt to form LLCs or other partnerships to benefit from the deduction.
Real estate investment trusts (REITs) will also benefit from the lower pass-through rates, as the New York Times noted.
2. Corporate tax cuts
Both the Senate and House versions of the bill slash the corporate tax rate from 35 percent to 20 percent. The House version kicks in next year, while the Senate version starts in 2019.
3. Depreciation
The Senate bill shortens the depreciable life of commercial assets from 39 years to 25 years, meaning that the rate at which property owners can take these deductions is sped up, according to the Times. Shimon Shkury, founder of Ariel Property Advisors, says the change is a win for commercial property owners.
“The property owner has a non-cash deduction, and essentially shelters more income,” he said.
4. Estate tax
This one’s for the real estate dynasties. The Senate version of the bill would double the federal estate tax exemption levels — currently a 40 percent tax on estates worth more than $5.49 million for individuals, and nearly $11 million for married couples. The House bill would do the same until 2024, when it proposes to repeal the estate tax altogether. According to the Times, President Trump would save $1.1 billion under the House’s bill.
5. Private activity bonds
City officials estimate that the elimination of private activity bonds would mean 10,000 less affordable housing units will be created or preserved each year — in New York, that could cut the de Blasio administration’s goals roughly in half. These bonds are used to claim 4 percent tax credits each year (which yield approximately 30 percent of the cost of constructing low-income housing over a 10-year period), and are a major source of funding for affordable housing across the country.
“You would be looking at a 65 percent reduction in the production of affordable housing [nationwide],” said Chris Eisenzimmer, director of affordable development at Greystone. “It’s creating a lot of uncertainty amongst investors and owners.”
The House bill revokes private activity bonds, while the Senate version leaves them intact.
6. Mortgage and property tax deductions
The House version caps mortgage interest deductions at $500,000, down from $1 million. The Senate’s bill doesn’t change the cap on these deductions but eliminates them for home equity loans, the Washington Post reported. The Senate version has also decided to follow the House in allowing deductions on property taxes of up to $10,000.
Bonus: Private jets!
The inclusion of a tax break for private jet owners in the Senate version of the bill inspired a flurry of angry tweets and stories this month. The measure, however, actually tweaks an existing tax law to assure that private jet owners don’t get hit with a “ticket tax,” which is intended for commercial airlines, according to the Wall Street Journal. Still, the private jet owners out there — Steve Witkoff, Jeff Greene, Michael Stern and Richard LeFrak, to name a few — are probably pleased with the change.
Tags: 1031 Tax Exchanges, estate tax, Real Estate and Politics
Share
Tweet
Share
Short URL
http://bit.ly/2AZX81b

A Chinese firm is investing in Newark.

Beijing Ideal Group, a investment and development company, purchased most of One Newark Center, a 22-story building on Raymond Boulevard near Military Park and Newark Penn Station, commercial realtor JLL announced this week.

The financial details of the company’s purchase from its previous owners, Mack-Cali Realty Corp. and The Praedium Group, were not disclosed. But, Cushman and Wakefield, a real estate services firm, announced earlier this month it had secured $66.58 million in financing for the Chinese company to buy the sixth through 22nd floors of the building. The first five floors will remain Seton Hall Law School, and were not part of the sale.

Morgan Stanley put up the 10-year, fixed rate financing for the sale, Cushman and Wakefield said.