By Joshua Burd
A joint venture has sold a 228-acre former brownfield site in Piscataway for $57 million, following a three-year effort to secure approvals that would allow the parcel to be redeveloped as a 2.4 million-square-foot industrial park.
The partnership of Lincoln Equities Group LLC and Real Capital Solutions announced Wednesday that they had sold the property at 171 River Road to the Rockefeller Group. Located off Interstate 287 and a little more than 10 miles from the New Jersey Turnpike, the site represents an opportunity to build big-box industrial space in a state that is increasingly supply-constrained because of the demand from e-commerce and other tenants.
Rockefeller is now planning to break ground on two new buildings later this summer, with an overall project cost between $225 and $250 million.
The sale comes three years after Lincoln Equities Group and Real Capital acquired the site, which housed a former plastics manufacturing plant and was later remediated by Union Carbide Corp. The firms went on to work with local officials to secure entitlements and development rights to build up to eight buildings from 250,000 square feet to 700,000 square feet, along with new roads, infrastructure and landscaping.
The firms reportedly had intended to develop the property themselves, but instead saw an opportunity to sell in light of the booming industrial market.
“This property closes at an important time for the state’s I-287 corridor, which is now seeing significant interest from industrial developers due to its proximity to Newark’s airport, port and rail stations,” said Joel Bergstein, president of Lincoln Equities Group. “We purchased the site at 171 River Road three years ago when most developers were focusing on the I-95 corridor, and we’re fortunate to anticipate where the state’s next wave of development would take place.”
The property, which had been vacant for decades, is a mile from I-287 and has direct access to both exits 8 and 9. In a separate announcement, Rockefeller said its plans call for a six-building campus representing a combination of speculative and build-to-suit opportunities.
The complex will be known as the Rockefeller Group Logistics Center and will feature buildings ranging in size from 200,000 to more than 800,000 square feet, Rockefeller said. The firm also said transaction options will allow for future users to lease or own their space.
“We’re thrilled to move forward with the Rockefeller Group Logistics Center on one of the largest remaining developable sites in New Jersey at a time when demand for well-located and well-designed industrial product in the state is so strong,” said Clark Machemer, senior vice president and regional development officer for Rockefeller Group’s New Jersey/Pennsylvania operations. “When complete, the complex will offer prospective users a level of flexibility that’s unparalleled in New Jersey.”
Other developers are looking to tap into what has been an increasing level of demand for space along I-287, as opportunities become scarcer along the New Jersey Turnpike. Research by the real estate services firm Transwestern found that the Piscataway and South Plainfield section of the highway recorded more than 1.1 million square feet of net absorption from 2012 through 2016, with rent growth of 44 percent during that time.
As part of their efforts to reposition the property, Lincoln Equities secured a payment in lieu of taxes agreement from the township. Local officials also committed to reconstructing Baekeland Avenue, which provides access to the site from Exit 8.
“The development of 171 River Road is a great example of what happens when government and private business come together with a common goal,” Piscataway Mayor Brian C. Wahler said. “Thanks to our collaboration with Lincoln Equities Group, this former brownfield site — which sat empty for decades — is now positioned to attract businesses and jobs into our community, adding to our tax base.”
The planned Rockefeller Group Logistics Center will also include excess trailer parking for each individual building, on-site rail service, and two means of ingress and egress to the site, Rockefeller said.
Marcel Arsenault, CEO of Real Capital Solutions, said the firm was “glad to be able to partner with Lincoln Equities.
“The team there is a great partner that has the local operating expertise we value,” Arsenault said. “We are creative entrepreneurial money with a fortress balance sheet, which allows us to work with partners like Lincoln Equities to maximize results and be a one-stop-shop for debt and equity.”