A rendering of Ironside Newark, the new office and retail complex that will result from an $80 million redevelopment of a historic warehouse by Edison Properties. — Courtesy: Edison Properties
By Joshua Burd
State officials have approved a 10-year, $31.5 million tax credit to encourage Mars Wrigley to move more than 480 employees to Newark, where it would lease 110,000 square feet at a historic warehouse that is being redeveloped by Edison Properties.
The incentive, approved Tuesday by the Economic Development Authority, is tied to a proposal that includes 370 workers currently based in Hackettstown and another 113 jobs that would be relocated from Chicago. If it follows through with the proposal, Mars Wrigley would make a $42 million capital investment and sign a 15-year lease at what will be known as Ironside Newark.
The Edison Properties site, located at 110 Edison Place, is expected to house more than 450,000 square feet of loft-style office space upon completion of the rehabilitation project next fall.
The EDA also approved a separate $1.15 million tax credit that is tied to a proposed renovation and expansion at the iconic Mars Chocolate factory in Hackettstown. The expansion would result from a $52 million investment at the 500,000-square-foot plant, the company’s home for decades, while calling for an additional 92 jobs to be brought in from Chicago.
The company told the EDA it was also considering an expansion in Chicago as an alternative to the proposals in Newark and Hackettstown, according to a board memo. The competing location is a 92,300-square-foot facility in the Windy City.
EDA officials estimate the projects would have a combined net benefit to New Jersey of $219.2 million over 20 years. Mars Wrigley is meeting several criteria that increase the award in Newark, including sustainable design at the project site and being part of a transit-oriented development.
The company, formally known as Mars Wrigley Confectionery US LLC, was created earlier this year after the merger of Mars Chocolate and Wrigley Sales Co. The iconic brands are split between regional headquarters sites on the East Coast and the Midwest.
Mars Inc. has called New Jersey home since 1940, when the company opened its U.S. headquarters and the first M&M’s factory in Newark.
RELATED: At Ironside Newark, Edison Properties seeks to attract modern tenants by tapping into history
If it chooses the Edison Place site, it would represent a high-profile addition to a critical project in the city. Ironside Newark is the first piece of Mulberry Commons, a planned mixed-use neighborhood and public plaza that will connect Newark Penn Station, the downtown, the Prudential Center and the Ironbound section.
City officials and developers gathered last month to break ground on the 22-acre park component, which will redevelop the parking lots that surround the 10-year-old Prudential Center.
A potential move by Mars Wrigley would also be a sign of continued strength for Newark’s office market. On Monday, Broadridge Financial Solutions opened a new 160,000-square-foot space at 2 Gateway Center, representing one of the largest new companies to come to the city’s downtown.
According to research from Newmark Knight Frank, office availability has been steadily declining since 2014 and equates to 20.4 percent as of the third quarter. Asking rents currently average $28.38 per square foot, up from $28.10 a year ago, while net absorption totaled 179,895 square feet over the past 12 months.
NKF also noted that the city offers a discount to the Hudson waterfront, where asking rents average $41.99 per square foot, along with connectivity to mass transit and area highways. The Newark central business district submarket contains 13.1 million square feet of office space, most within walking distance of Newark Penn Station.
Other recent deals in the city include Gibbons PC’s 112,000-square-foot renewal at 1 Gateway Center, NKF found, while Audible is converting a historic church at 27 Washington St. into an engineering and development hub a block from its existing headquarters.