By Ron Leir
Hopes by Kearny to secure a developer for the old Koppers Coke Peninsula Redevelopment site have taken one step forward and two steps back. Kearny and Tierra Solutions, the owners of two of the three parcels in the South Kearny meadows area targeted for redevelopment, teamed with the Hudson County Improvement Authority, the third property owner, to jointly market the moribund site for new ratables in hopes of maximizing the future value of the property.
To that end, the HCIA – acting on behalf of all three – invited prospective developers to submit proposals which were eventually narrowed to a short list of two: The Morris Companies and Cleaner/Matrix.
On Aug. 13, the HCIA board of commissioners authorized its representatives to designate The Morris Companies as the prospective developer – but only for the HCIAowned Koppers site – and to proceed with negotiations for 180 days for a sale/purchase agreement.
Morris’s legal representative is Theodore A. Schwartz, a former deputy state attorney general and environmental law pioneer who is now a partner in the Lyndhurst law firm of Scarinci Hollenbeck.
HCIA Executive Director Norman Guerra said that when it came down to adding in costs to remediate the environmentally compromised 25-acre Kearny-owned former Standard Chlorine parcel and the 30-acre former Diamond Shamrock property owned by Tierra Solutions, the developer wasn’t persuaded to buy in to the concept of an all-inclusive project.
By contrast, Guerra said, the county has already invested in extensive cleaning of the HCIA property and “we’ll be raising our portion of the [redevelopment area] 13 feet above sea level in compliance with the latest FEMA flood control guidelines.”
Those improvements to be undertaken by the developer would be expected to serve as a “cap” for the property, he added.
Guerra said that Kearny representatives “did sit with [the developer] on their piece” in an effort – thus far, unsuccessful – to include the town’s property as part of the company’s overall development plan. The town may continue to press its case with the developer, he added.
As for the Tierra parcel, Guerra said that, “there was no offer for that property by any of the [prospective developers].”
If and when the HCIA and The Morris Companies can nail down a deal, Guerra said the 40-year-old company – which has offices in Rutherford and Florida – figures to build “close to 2 million square feet of big box warehousing” on 138 “buildable” acres of the Koppers site.
With additional work like “infrastructure and road access” to be undertaken by the company, Guerra figured that total build-out would “take a good six months,” once the project got off the ground.
Kearny Mayor Alberto Santos, reached on vacation, had this observation on the situation: “We’re exploring with Tierra developing our two sites together. … There is a developer interested but not from Morris. … The town doesn’t oppose the Morris designation; however, it’s in the town’s interest to explore other developer interest for the town-owned Standard Chlorine site. I think the town can achieve better financial terms that way.”
Incidentally, the mayor added, “Any matters relating to utilities or PILOTs (Payments in Lieu of Taxes) on any of the sites, including Koppers, can’t be done without the town’s agreement.”
Asked by The Observer why the HCIA elected to go with Morris over their competitor, Guerra said that while the overall “numbers from both were pretty comparable,” the rival firm’s submission proposed “phased” payments whereas with Morris, “we’d get paid up front.”
Among the completed industrial developments Morris lists on its website are: a 440,000 square foot Barnes & Noble facility, a 420,000 square foot Canon USA building and a 605,732 square foot Proctor & Gamble warehouse, all in South Brunswick; and a 733,688 square foot Wakefern building in Jamesburg.
Looming over the whole situation is a plan by NJ Transit to develop a micro-grid as a power source in the Peninsula redevelopment zone which is pending a federal funding review. And, if the agency gets its way, it’s unlikely that any new tax revenues will be generated from that use.
“If [NJ] Transit wants the property,” said Guerra, “they’re just going to have to take it through condemnation.”