In a move that would make Jersey City its own master developer of the Bayfront property, the City Council has adopted an ordinance to bond for $170 million to cover the cost of purchase and infrastructure improvements.
The city and Honeywell International currently jointly own a 90-acre site along Route 440 on the west side of Jersey City. Honeywell recently concluded a cleanup of chromium contamination on the site and told the city earlier this year that it wished to sell the land, rather than become part of its redevelopment.
Seen as the largest development in Jersey City since the Newport development in the early 1980s, the purchase would allow the city to control the amount of affordable housing that is constructed there.
Although the city owns a portion of the property, the purchase will require the city to pay back about $30 million the city got from Honeywell as advance payment on potential development.
Honeywell, the conglomerate that had been accused of dumping chromium in the area, was one of several entities that were part of a cleanup and planning effort for the multi-site project up and down the river.
The Bayfront I Redevelopment Area is part of a larger vision from May 2003 called the Jersey City Bayside Development Plan, which set the stage for redevelopment of the Hackensack Waterfront.
Mayor Steven Fulop proposed the purchase earlier this year as one of a number of possible options, and the council adopted the ordinance at its Oct. 10 meeting.
In favoring the option to purchase, Fulop said that if the city allowed the sale of the whole parcel to be sold off by Honeywell to another developer, the city would have little control over the pace of development and would have limited options for requiring the construction of affordable housing on the site.
By becoming the master developer, the city could possibly recoup the entire $170 million or more from future development there.
The $170 million bond also covers the cost for the construction of sewer and water lines, roads and other infrastructure. The bond will leave $90 million toward the purchase of the land, with the remaining funds to be available for other development costs, such as the demolition of existing structures, the construction of further infrastructure, and more.
“Mayor Fulop and his team have worked tirelessly to ensure this project becomes the centerpiece of the revitalization of the City’s West Side.” – Dan Kirschner
The biggest risk, Fulop noted, is a potential down cycle in the demand for housing or a spike in mortgage interest rates. But the mayor said the city could afford to wait out the cycle until the market improves.
“As we continue to transform the city’s west side, this is an important step forward in the development of the largest mixed-income community in our region,” said Fulop. “Our priority is to create more affordable housing options throughout the city for our residents, and through this purchase, we will be able to do just that.”
Diana H. Jeffrey, acting executive director of the Jersey City Redevelopment Authority, said the plan could generate as many as 4,100 total units, and 33 percent of those could be affordable housing.
“Mayor Fulop and his team have worked tirelessly to ensure this project becomes the centerpiece of the revitalization of the city’s west side,” said Dan Kirschner, Honeywell global director of real estate. “We have received the environmental approvals required for transfer of the property and are committed to working collaboratively to finalize the sale.”
In August, the City Council approved the creation of an advisory board to help guide the Bayfront Redevelopment project, consisting of city officials and four community members.
The council’s action did not come without opposition.
In June, some residents, religious leaders, and civic activists raised concerns over the impact of the project on the area.
Some pointed to the massive traffic backups on Route 440 that already exist, predicting they would be made significantly worse, since all of the traffic to and from this development would have to use Route 440.
City officials said they hope to see the expansion of the Hudson Bergen Light Rail line to Route 440 from its current terminus at Westside Avenue. This would provide an alternative public transportation option, not just for this property, but also for the west campus of New Jersey City University. The university is currently constructing residential and commercial buildings in that area.
But some critics claim this is an unrealistic expectation, and also point out that plans for the Honeywell property call for a doubling of residential units from 4,100 to more than 8,000 units if the light rail is brought to Route 440. These critics say that even if people use public transportation, they will also likely have cars.
The other significant issue for some critics is the possible impact of having a massive amount of affordable housing concentrated in one development rather than spread out across the city, both on property values nearby and the perception of an affordable housing neighborhood.