Hovnanian Enterprises — the parent company of Matzel & Mumford, developers of the Wheatena site on Elizabeth and Grand avenues — reported more bad news from the last quarter.

The Rahway Redevelopment Agency last year accepted a revised concept for the former oatmeal factory site adjacent to the railroad tracks and Rahway River Park. Instead of the 264 condominium flats and 36 townhouses, M&M plans 130 townhouse units with clubhouse amenities. (The image above is from the city’s Web site).

Negotiations with the largest property owner have been going on for an extended period of time, according to Redevelopment Agency attorney Frank Regan, with the sticking point being environment issues. “The environmental issues are not nearly as bad as all had expected,” he said at last week’s RRA meeting, so some concessions are being sought from the property owners.

City Administrator/Redevelopment Director Peter Pelissier mentioned at a previous RRA meeting that the project could be done in phases, starting with the parking lots.