A rendering of South Beach at Long Branch, an oceanfront, 41-unit luxury condominium complex by FEM Real Estate along. Plans call for two eight-story glass-exterior towers connected by a plaza level. — Courtesy: FEM Real Estate
By Joshua Burd
For all of the talk of revitalizing Long Branch — a concept that goes back decades — Mayor Adam Schneider points to a meeting that has stuck with him more than 20 years later.
It was the mid-1990s and city officials were sitting with Jane Thompson, the famed urban planning consultant, in hopes of breathing new life into what had been an iconic Jersey Shore resort town. To Schneider and his colleagues, that meant crafting a solution for the once-thriving, downtown business corridor known as Lower Broadway.
Thompson had a much different take.
“She looked at us and said, ‘Not going to happen until the oceanfront gets going. You’ve got to convince people that they can come to Long Branch for the ocean before anybody is going to look at Broadway,’ ” Schneider recalled. “And it was a very sobering moment because we had a lot to learn.”
The learning process was indeed difficult, both politically and economically, but the city is finally starting to see the benefits of that formula. More than a decade after the debut of the landmark, mixed-use Pier Village complex, Long Branch has other developments under construction or in the pipeline along its oceanfront, including new luxury condominiums.
And along Lower Broadway, a developer is in the midst of demolishing dozens of blighted properties, following the resolution of what had been a fierce legal battle over back taxes and entitlements. The demolition is now clearing the way for a mixed-use project that could begin to transform the downtown as soon as next year.
“We’re all optimistic that we’re on the right path, and that’s a major turnaround,” said Schneider, the city’s mayor for the past 27 years. “If Pier Village was the biggest project up until now in Long Branch, that’s next.”
Parts of the city have suffered from decades of decline. And more than 10 years ago, the community gained national attention for litigation tied to the city’s use of eminent domain to seize dozens of waterfront homes, which helped make way for Ironstate Development’s $400 million Pier Village project.
Efforts to spur additional development have been stalled by the recession and other setbacks, but the tide may be turning in Long Branch. Last year, FEM Real Estate broke ground on 47 high-end waterfront condominiums as part of a two-building complex known as South Beach at Long Branch, located at North Bath Avenue between Ocean Boulevard and Ocean Avenue.
The project was slated to be pouring concrete and moving into footings and foundations by Memorial Day, with completion slated for late 2018 or spring 2019. And Mimi Feliciano, cofounder and CEO of FEM, said the project has already attracted strong interest from would-be buyers. Through mid-April, the project had already sold an oceanfront first-floor unit and had several purchase offers “well on their way to contract,” she said.
If successful, it could serve as the southernmost anchor for more than 15 acres of beachfront in the city that runs up to Pier Village.
“We’re taking the chance of first risk … and there seems to be a lot of interest in our project, so it’s creating confidence for that area, both for the political people and other developers,” Feliciano said in an interview late last year. “It will be quite a boon to the town because of the jobs it’s going to create, and as these redevelopment zones go, that was the idea — to get some stimulation.”
RELATED: FEM project design brings a taste of South Beach to Long Branch
Other projects along the coastline are also filling the pipeline. Chief among them is the third phase of Pier Village, now owned by Kushner Cos. and Extell Development, which have been approved for nearly 270 for-sale residential units, a new hotel and another 57,000 square feet of retail. The project would add to what is already more than 800 for-sale and rental units, two hotels and more than 120,000 square feet of retail space, while also helping to rebuild a piece of the boardwalk owned by the developers.
Schneider also pointed to three other redevelopment projects that have received approvals from local officials and state environmental regulators, including condominium projects of 33 units and 57 units. But it’s what Schneider sees happening west of Ocean Boulevard, the city’s main thoroughfare, that has him most excited.
At Cooper Place, an affiliate of REDEV Group LLC has won city council and planning board approval to build 169 apartments. The project will transform a nearly 12-acre lot into what Schneider feels will be “a really handsome project with nice amenities and very significant public improvements.”
And along Lower Broadway, there are signs of progress for a vision that has been more than 20 years in the making and seemed poised to move forward about a decade ago. At the time, a group known as Broadway Arts Center LLC received approvals to redevelop more than 50 properties across 10 acres, only to default on its loans.
Long Branch Partners, an affiliate of Montville-based Diversified Realty Advisors LLC, would go on to acquire the assemblage about three years ago after first acquiring the debt, but a year-long, contentious legal battle over taxes and zoning threatened the project once again.
Over the past year, however, the two sides have managed to reconcile after the firm paid millions in back taxes.
While a formal redevelopment agreement is still in the works, the project would effectively rebuild the Lower Broadway area. Nicholas Minoia, managing partner with Diversified, said its plans call for 590 multifamily rental units, two parking decks and 97,000 square feet of retail space, including 18,000 square feet for a grocery store or food hall.
The firm, which has been conditionally designated as the redeveloper, also plans to widen Broadway and create a boulevard that supports foot traffic and pop-up shops, Minoia said. It will likely seek planning board approval this fall and, if all goes as planned, construction could begin by spring 2018.
“It seemed like the natural, next logical progression to develop the Lower Broadway area,” Minoia said of the firm’s decision to pursue the project, which meant negotiating with about a dozen banks to first acquire the notes.
“Everybody is really excited about the timing of everything we’re doing there,” Minoia added.
In order to get there, Diversified is razing about 40 blighted structures across 55 parcels, most of which had sat empty for decades. They include everything from one- to four-story buildings, many of them with ground-floor retail and office or residential space above, plus a former theater that had become dilapidated and never found the public support needed to refurbish it.
Many of those buildings have already come down, while the remaining properties are slated to be razed by June 26. Minoia estimates the work will total between $1.5 million and $2 million in demolition costs.
“It’s a pivotal time for Long Branch as it relates to our site,” he said.
And despite what had been a complex financial transaction and legal battle, Minoia said the success of Pier Village and other oceanfront projects made Long Branch a compelling investment. The city has much to offer, he said, such as the nearby Monmouth University population, mass transit, highway access and proximity to the dense population of northern New Jersey and Manhattan.
Feliciano shares that sentiment: There is something to be said for a community that has the feel of the Jersey Shore but is still less than 60 miles from Manhattan.
“That’s why people tell me they love the location, because they don’t want to be too far,” Feliciano said. “They feel isolated when they’re more than an hour from their job.”
Schneider said there are other projects coming to the area, but development activity isn’t the only sign of growth in Long Branch. For instance, the city last year recorded more than $2 million in beach badge revenue, its best year ever, while also pulling in more than $1.5 million from parking fees.
It’s all part of an improving economic picture for a city that has been waiting for its revitalization for decades and one whose boardwalk was devastated by Hurricane Sandy in 2012. Beachgoers have responded even though the boardwalk did not open until April 2016, but Long Branch now has reasons to be hopeful on multiple fronts.
“The exciting thing is that there’s so much going on at once. It took a lot to sort of break the dam down between the economy and timing and everything else coming together at once,” Schneider said, later adding: “We always have to tell people this: We’ve really been working hard. You might not have seen all of the progress, but now you’re seeing it.”
Success story
With good reason, Diversified Realty Advisors was one of several groups seeking to take over 10 acres of prime redevelopment area in downtown Long Branch.
But the deal wasn’t for the faint of heart. No fewer than 12 banks held the debt on the property, Minoia said, requiring the firm to negotiate with each one in order “to get everybody on the same page” and allow it to buy the notes at a deep discount.
Once Diversified had completed that step, it went on to strike a deal with the guarantors in March 2014 to ultimately take deeds in lieu of foreclosures on the properties. For a deal in which “a lot of people tried but couldn’t get to the finish line,” Minoia said the firm was fortunate to be able to see it through.
“It’s a great story of a complex deal that went bad during the recession, and then the flip side of that is we were able to structure a transaction with these banks,” Minoia said, noting that one bank actually had the confidence to stay in the deal as a lender.
“They’ve been in it since we bought the debt and they’re still in it today with us. … They believed in the project long-term once we got involved because they thought we were the right sponsor compared to the prior owner.”
