A rendering of the rehabilitated façade at Garden Spires, a public housing complex at located at 175 First St. in Newark. — Courtesy: New Jersey Housing Mortgage and Finance Agency
By Joshua Burd
An investment group has set out to revitalize two public housing complexes in Newark that city officials say are nearly uninhabitable, with plans to spend more than $170 million on the project and the full financial backing of the state.
Executives with the firm, Omni America LLC, joined public officials on Wednesday to kick off the work at Garden Spires and Spruce Spires, which are located at 175 First St. and 719 Dr. Martin Luther King Jr. Blvd., respectively. The group is now set to rehabilitate more than 650 apartments across the two properties, along with building systems, exteriors and common areas in complexes that are notoriously rife with safety concerns and code violations.
Omni America has purchased the complexes from First King Properties LLC and will tap into more than $172 million in state funding and financing. Work on both sites is expected to be complete by December 2019.
“This is a new day for Garden Spires,” Newark Mayor Ras Baraka said. “We are putting an end to 52 years of mismanagement and neglect that has created appalling conditions and needless tragedy for generations of residents. The tenants of these two buildings will now live in safe, clean, well-maintained homes, our city will gain additional affordable housing, and a threat to public safety and public health will be eradicated.
“We thank our state partners, and Omni America for their work and leadership.”
City officials say Garden Spires and Spruce Spires — built in 1963 and 1920, respectively — have amassed more than 2,700 violations from the state Department of Community Affairs and hundreds more from the city. That includes everything from missing smoke alarms and security issues to infestations and broken electrical and plumbing fixtures.
Most egregiously, a young child fell 15 stories to his death in 2005 after slipping past improperly installed window guards at Garden Spires. Baraka’s administration last year filed a lawsuit against First King Properties.
Omni America, whose co-founders include former Major League Baseball and Seton Hall University slugger Mo Vaughn, is now tasked with remediating all past safety violations and improving living conditions. The New York-based firm will do so with assistance from the state Economic Development Authority and the New Jersey Housing Mortgage and Finance Agency, which have each tapped into some of their most lucrative programs for developers.
The larger of the two projects will be at Garden Spires, a two-building, 544-unit complex on First Street adjacent to Interstate 280. HMFA is contributing $59.3 million in financing from its Conduit Bond program to the rehabilitation project, which includes new roofs, extensive common area renovations and in-unit improvements such as kitchens and bathrooms.
Plans also call for new building mechanical systems including hot water heaters, boilers and electrical panels, as well as a cogeneration system at Garden Spires, city officials said. Omni America will also repave the parking lot and repair exterior walkways, while upgrading the security alarm system and installing some 400 DVR surveillance cameras.
“Today marks a major turning point for residents of Garden and Spruce Spires after years of deterioration and deplorable living conditions that residents have had to endure,” said Lt. Gov. Sheila Oliver, who is also the DCA’s commissioner. “It is a new day as this administration, in partnership with the city of Newark and new owner, pledge to provide residents a safe and decent place to live.”
The HMFA’s Conduit Bond program is also contributing $16.3 million in financing to revitalize Spruce Spires, which has 112 apartments across five buildings on Spruce Street and Dr. Martin Luther King Jr. Boulevard, according to a press release. The $37.2 million will result in repaired sidewalks and walkways, upgrades to the security alarm system and the installation of about 100 DVR surveillance cameras.
The agency will also provide 4 percent Low Income Housing Tax Credits to the developers, which are slated to generate $49.1 million in additional private equity.
“The present condition of these buildings reflects the worst we have encountered in our state inspections,” said Charles A. Richman, the HMFA’s executive director. “Regrettably, tenants have suffered for years with little hope for change. Today, they can look forward to not only substantially rehabilitated buildings, but a place they can proudly call home.”
Meantime, Omni America will tap into a $43 million tax credit under the state’s Economic Redevelopment and Growth program, which was approved earlier this year by the EDA. The authority said at the time that Omni America has rehabilitated more than 8,400 units with tenants in place since its founding in 2004.
No tenants will be displaced during the rehabilitation process in either complex, according to the news release. In-place rehabilitation will take about 12 to 18 months in several phases, while most residents will be able to return to their apartments at the end of each day.
“Facilitating investment in areas where it is needed most is a key component of Gov. (Phil) Murphy’s vision for a stronger and fairer economy,” said Tim Sullivan, the EDA’s chief executive. “In this case, that investment means a new, more secure future for several hundred families in the city of Newark.”
The U.S. Department of Housing and Urban Development provides project-based Section 8 rental assistance for two-thirds of the units at Garden Spires and all of the units at Spruce Spires. Omni America, which specializes in affordable housing, owns or manages more than 13,000 units in New York, Wyoming, Massachusetts, New Jersey, Rhode Island and throughout the Southeast.
“We are excited to work with city, state and federal officials to bring about the much-needed renovations to vastly improve the quality of life for residents and improve the health of the buildings,” said Eugene Schneur, Omni’s co-founder and managing director. “We want to thank all of the government and financial organizations that made this deal possible.”