Developer Seth Martin has been approved to begin construction on a new mixed-use complex in Jersey City known as Bergen Arch Plaza. Plans include two 28-story towers that will each top out at about 303 feet tall. The development will rise from an assemblage of zoning lots including 414-432 Hoboken Avenue. Designed by LWDMR Architects, the complex includes a mix of residential, retail, and office area, in addition to new public walkways both above and below grade.
Beginning at the ground floor, the site incorporates a large central plaza designed with landscape architect Arterial Design Studio. The plaza will span 5,900 square feet and include ample public seating, Citi Bike docking stations, and a descending stairway into the historic Bergen Arches, an abandoned railroad tunnel also referred to as the Erie Cut. The design team will clean and repurpose the tunnel as an extension of the public plaza.
Bergen Arch Plaza will include multiple retail suites within both the East and West Towers. All together, this component measures 6,700 square feet. The lower levels will also contain ample parking for future occupants, visitors, and commercial tenants.
Office space at the second and third floors of each building will occupy approximately 29,000 square feet. These areas include access to multiple outdoor spaces including a manicured garden and a large private terrace.
Residential area rises from the fourth floor to the pinnacle of the buildings and accounts for the bulk of both towers. The East Tower will comprise 367 apartments, while the West Tower will contain 157 apartments for a grand total of 524 individual units. Layouts will include studios to three-bedroom spreads. Plans also reveal a robust amenity suite including a roof level pool, multiple outdoor spaces, a fitness center, storage rooms, and lounge areas.
The 1860s mansard roof house was demolished in November and demolition permits were issued for the remaining structures on the site two weeks ago, but there hasn’t been any exterior demolition yet. Underground utilities were being cut when I passed by on December 17.
They’re asking for a two-year extension, and explain why they haven’t been able to obtain funding to build the towers in their filing in the past 6 years:
Extensive Historic Fill has been identified on the Property and while demolition has been completed, before construction can commence, the Licensed Sire Remediation Professional (“LSRP”) has required the removal of the Historic Fill. The Geo-tech report issued June 12, 2019 by JZN Engineering that the building’s loads should be supported on rock and not the soil/gravel. Before construction can commence, the Historic Fill, silt and gravel must be removed. The Applicant is in the process of obtaining cost and time estimates for such removal.
Given the complexity of the proposed project – twin 28 story towers above a base with extensive public access – construction drawings will take significantly more time to prepare with an unusually high cost. The Applicant is in the process of obtaining cost/time estimates and anticipates commencing the construction drawing process sometime during the second (2nd) quarter of this year.
Financial market conditions have also had an unsettling effect on the Project. The on again/off again/on again tariffs, as well as potential material shortages, render construction cost estimates to be guesses at best. In turn, the unsettled cost of construction, has a material adverse effect on construction lending. Further, although there has been speculation regarding the lowering of interest rates, interest rates for construction loans have not come down. On the other hand, the unsettled cost of construction has led institutional lenders to lower their loan to value ratios, which in turn, have increased the equity required. In addition, as maximum construction loans are based upon a percentage of the stabilized value of a project on completion, the higher interest rates reduce the stabilize value. The need for the additional equity means that the Applicant needs to attract investors seeking a reasonable return.
That’s a lot of words in there for “we don’t have the money to build”. They likely can’t find a buyer (for a price they like). Never understand why some developers just sit on property for years doing nothing. I’ll say lightly that the predicted upcoming economic situation means this project is likely dead. But we’ll see!
Not sure if you really read what they wrote. They wrote about the need for environmental remediation and demolition, and about tariffs causing high required loan-to-value ratios, meaning they have to raise more risky equity to build the project. Hard to convince people to contribute equity since it can be wiped out easily. Also says they’re working on construction drawings in the next two months.
