Page 17 - RE-NJ

POLICY
PAGE
‘A BIG WIN’
CRE LEADERS HOPEFUL AFTER MURPHY SIGNS LAW TO
BOOST VIABILITY, ELIGIBILITY OF ASPIRE PROJECTS
By Joshua Burd
Gov. Phil Murphy has signed a law
to expand the Aspire tax credit
program for developers, in part by
allowing projects in New Brunswick,
Camden and East Orange to secure
larger awards, while taking steps
meant to help applicants secure
construction fi nancing.
Notably, the law allows developers
that cannot use or sell their tax
credits within one year of their
issuance to sell them to the state
Department of the Treasury for
85 cents on the dollar. Yet experts
note that the state is not explicitly
required to buy the tax credits,
leaving a loophole that industry
Among other changes, the bill adds
leaders hope to address through a
the three cities to the list of so-called
companion bill that’s pending in the
government-restricted municipalities
Legislature.
that are eligible for enhanced
subsidies from the Economic
Development Authority. That means
projects in those locations may now
seek tax credits equal to no more
than 80 percent of eligible costs,
up to $120 million, as a means of
addressing fi nancing gaps.
“This would create the much-
needed confi dence for the
lending community to arrange for
construction bridge fi nancing,”
NAIOP wrote in its member alert.
“The recently introduced A5170/
S4027 addresses this key missing
provision, which, when added, will
There are now six government-
encourage more real estate projects
restricted municipalities or GRMs,
statewide to move forward to
with New Brunswick, Camden and
construction.”
East Orange joining the existing
cities of Atlantic City, Paterson and
Trenton. The new law, A2076, also
expands potential subsidies for
projects in the original three GRMs,
Other changes include shortening
the payout period, from 10 to fi ve
years, for tax credits that are pledged
to projects in the six government-
allowing the state to award tax
credits of up to 85 percent of eligible
costs and no more than $120 million.
“The legislation’s impact includes
a broadening of the types and
geographical location of projects
which qualify for Aspire incentives,
as well as the size of available
tax credits and other fi nancial
considerations for program
applicants,” NAIOP New Jersey
wrote in an alert to members on Jan.
23, a day after Murphy signed the
bill. “Make no mistake, this is a big
win for the (commercial real estate)
industry.”
The law marks the latest update to
Aspire, which launched in 2021 as
part of Murphy’s suite of economic
development incentives. The EDA
has approved some two dozen
applications under the program
since early 2023 — including many
with affordable housing — but only
a handful of high-profi le commercial
projects have reached the approval
phase.
Gov. Phil Murphy in late 2024
restricted municipalities. The same
would go for “special mission”
developments — a newly created tier
under the law — referring to those
in a GRM or so-called enhanced
area that serve a special mission,
as determined by the EDA, to
accomplish the public purpose of a
nonprofi t developer or entity that’s
affi liated with the proposal.
Such projects must include no
BAYFRONT PROJECT LANDS
$64 MILLION ASPIRE AWARD
The fi rst piece of the highly touted
Bayfront housing project in Jersey
City is moving ahead with the help
of a newly approved, $64 million tax
credit award under the state’s Aspire
program.
According to the Economic Devel-
opment Authority, which approved
the subsidy during its monthly board
meeting in January, the Bayfront
Promenade will bring 210 rental
units to the city’s growing West Side
neighborhood. That will include 74
homes reserved as affordable hous-
ing, along with some 10,600 square
feet of commercial and retail space
that will help activate a vacant for-
mer industrial site on Route 440.
The gap fi nancing award to Bayfront
Partners 32 Urban Renewal, the de-
veloper, represents up to 60 percent
of the total project cost.
“Under Governor (Phil) Murphy’s
leadership, the Aspire program has
supported meaningful develop-
ment projects throughout the state,
helping to expand housing options
for New Jersey families,” said Tim
Sullivan, the EDA’s CEO. “Bayfront
Promenade will help revitalize the
West Side of Jersey City and provide
residents with affordable housing op-
tions and access to critical services.”
The approval marks another key step
for the long-awaited project, part of
a multiphase plan for a 100-acre tract
once owned by Honeywell Corp. The
city acquired the waterfront parcel
in 2018, with visions of creating the
largest collection of affordable hous-
ing of any private, mixed-income
community of its size in the country.
™ 15
Courtesy: Governor’s Offi ce
more than 100 units of 100 percent
supportive housing and no more than
25,000 square feet of commercial
space for the provision of on-site
social service programs that require
a license from the state. The bill
exempts special mission nonprofi t
projects from the EDA’s net benefi ts
test, affordable housing requirements
and the need to provide a market
study as part of an application to the
authority.
The project will also include ameni-
ties such as an outdoor terrace with
grilling stations, a community lounge
with a kitchen area, a coworking
lounge, a fi tness and yoga room, a
dog washing station and a children’s
play area, the EDA said. Additional
plans call for a 21,000-square-foot
covered parking garage with 52
parking spaces and electric vehicle
charging stations.
“The Bayfront Redevelopment Proj-
ect represents a transformative step
forward for Jersey City’s West Side,
bringing much-needed affordable
housing, vibrant mixed-use spaces
and new opportunities for our resi-
dents,” Jersey City Mayor Steven M.
Fulop said. “With the support of the
NJEDA’s Aspire tax credit awards,
we are turning vision into reality,
building a stronger, more inclusive
community that refl ects our commit-
ment to progress and equity.”