Bayonne, June 30, 2006 – The Bayonne Local Redevelopment Authority (BLRA) held a special meeting on Monday, June 26 at 4 pm to authorize the signing of a redevelopment agreement for the right to develop within the Bayonne Bay District at The Peninsula at Bayonne Harbor (the former Military Ocean Terminal).

The resolution authorized BLRA Executive Director Nancy Kist to sign an agreement with Bayonne Residential Limited Partnership (Trammell Crow Residential), to build approximately 530 rental units on blocks B-3 and B-9 within Bayonne Bay. The B-3 and B-9 Blocks are the westernmost blocks in Bayonne Bay and sit adjacent to Harbor Station South. The combined acreage of the two blocks is approximately 7.42 acres.

Trammel Crow proposes approximately 4 buildings on these two blocks. The development will include indoor parking decks and swimming pools for tenant use. The BLRA has indicated that Trammel Crow will pay over $18 million for rights to develop the B-3 and B-9 blocks. A deposit of $11.3 million will be due upon signing the redeveloper agreement.

Originally, Trammel Crow Residential submitted a proposal to develop the entirety of Bayonne Bay with D.R. Horton but negotiations between the BLRA and D.R. Horton terminated on Friday, June 23rd. The BLRA received written notification from D.R.

Horton after business hours on Thursday, June 22nd that purported to terminate negotiations because the BLRA had taken too long to negotiate the deal. Nancy Kist said the letter came as “a complete surprise. We had no prior indication of a problem. We had been working well together in daily dialogue to complete the transaction. So we were shocked to receive this notification just two business days prior to seeking the Board’s approval for the final contract.”

Kist, who has negotiated similar complex real estate transactions, explained that “these negotiations were not taking an unusually long amount of time. It naturally takes time to address the wide range of issues that are associated with a contract for a 67-acre parcel of land,” she added.

The BLRA will resume negotiations with the remaining developers that submitted proposals for Bayonne Bay in July of 2005. The BLRA expects to have another developer on board within the next 30 to 90 days. The remaining developers are (in alphabetical order):

1. Bayonne Bay Developers, L.L.C., a newly established entity owned by Atlantic Realty and Alliance Associates Group. This entity indicated that it would acquire the land and convey a portion of it to Centex Homes for development.
2. The Beechwood Organization and Standard Pacific in a joint venture entity to acquire and develop the property.
3. Boraie Development, a New Jersey company.
4. Foxpointe, LLC, a single purpose entity owned primarily by Morton Salkind, Carole Salkind and Herbert Klein of New Jersey.
5. Pulte Homes.
6. Roseland Properties and Lennar Corporation in a joint venture to acquire and develop the property.
7. Somerset Development and Ryan Homes in an arrangement that would have Somerset acquire and improve the property and then have it turned over to Ryan Homes for construction of at least 50% of the units.
8. Taylor Development, a single purpose entity to be owned primarily by Robert Mazzuoccola.
9. Toll Brothers.
10. Trammel Crow Residential.

In April 2006 when Trammel Crow was selected by the BLRA, Nancy Kist noted that the BLRA was “extremely impressed by the quality and creativity of all of the proposals we reviewed.” She added that that “the high level of interest from the nation’s leading real estate developers, and ultimately, the sums offered in the bids are a testament to the value and marketability of The Peninsula at Bayonne Harbor.” At that April 2006 selection meeting the BLRA Commissioners directed Kist to hold the remaining proposals both open and confidential in the event that negotiations didn’t conclude successfully with either Trammel Crow or D.R. Horton.

“Trammel Crow Residential was chosen because its proposal brought to life our vision for a mixture of waterfront and urban living in a park-like setting,” said Howard Fitch, Chairman of the BLRA Board of Commissioners. He added that TCR, “has the experience and financial strength to ensure that the plan will be transformed into the reality we all envision.”

Founded in 1977, Trammell Crow Residential (TCR NJ/PA Properties, Inc.) of Morristown, NJ, has developed more than 180,000 apartment units and has $2.3 billion in assets. TCR also manages 65,000 apartment units.

Bayonne Mayor Joseph V. Doria, Jr. noted that the sale of these parcels in Bayonne Bay will significantly benefit the City of Bayonne. “It will create hundreds of construction jobs, plus the permanent jobs needed to manage rental properties. It will also add to the tax base which means it will provide tax relief to all of Bayonne’s homeowners.”

About the Peninsula at Bayonne Harbor

Since the U.S. Army transferred complete ownership of the former military base in 2002, the BLRA has raised more than $50 million in government grants and interim lease payments to make infrastructure improvements needed to attract development. These improvements include new bulkheads along the base’s south side and environmental remediation that was completed this year, ahead of schedule. Other projects include the installation of a new sewer system and planning for a new electrical grid and new roads.

Redevelopment of The Peninsula is organized around the creation of six different, yet integrated districts.

In 2004, Cape Liberty Cruise Port opened on the first district, Bayonne Point, marking the first tangible step in the transformation of the 430-acre site. It resulted in 51 cruise ship calls in its first season and created 300 jobs. Since then, the Cruise Port has grown to become the third-ranking passenger port on the East Coast (after New York and Miami).

Early this year, the BLRA approved plans for development of another district, Harbor Station North, which will consist of mid-rise housing, service retail space, and park space adjacent to the 45th Street light rail station. The approval of this contract to develop a portion of Bayonne Bay will begin the transformation of the third district.

Other districts to be developed include The Landing, which will have a water transit docking facility surrounded by a commercial and entertainment area with shops, stores, a hotel and restaurants as well as a residential section with mid-rise housing; The Loft District, which will be converted to hip loft-style housing units adjacent to the ferry landing with views of lower New York Harbor, the Verrazano Bridge and golf course; and The Maritime Industrial District.

For more information about The Bayonne Local Redevelopment Authority, visit www.bayonnenj.org/blra.




 

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