Carriage City Properties (CCP) still has not finalized or executed the settlement agreement with the Redevelopment Agency, attorney Frank Regan told commissioners during their meeting earlier this month. The Redevelopment Agency approved a settlement at its meeting in May. (For details on the agreement, see this earlier post.) A representative of Carriage City Properties had no comment.
Continue reading Carriage City settlement still not executed
The city’s assessed value rose by $25.3 million this year, up about 1.67 percent to $1.546 billion. That translates into roughly $1.2 million in property tax revenue. The bulk of the increase came from Carriage City Plaza Properties (CCP), assessed at around $19 million, and paying $978,000 in property taxes.
[12/12 update: Got an email from a rep at Silcon saying the Carriage City Plaza project is responsible for the entire additional $1.2 million in property tax revenue; $978,000 from Carriage City Properties + property taxes paid by individual unit owners. Trying to get some clarification from the city tax office, probably come Monday].
[12/15 CLARIFICATION: According to the city tax office, Carriage City Properties and the individual condo units — both sold and unsold — were assessed at a combined $24,146,600 ($5,414,500 for sold units + $18,732,100 for CCP portions and unsold units) and paid property taxes of approximately $1,182,941.94 ($265,256.36 sold units + $917,685.58 CCP and unsold units.]
During a discussion on the municipal budget at last month’s City Council meeting, and a question about potential future revenues, City Administrator and Redevelopment Director Peter Pelissier told the council two significant projects should provide future revenue. The city tax assessor is in the process of adding the assessment for Park Square, which begins its Payment In Lieu Of Taxes (PILOT) this year, he said, and Renaissance at Rahway, which is scheduled to be completed in about 12 months.
City taxes are expected to remain about the same thanks in part to $1.6 million in sewer utility surplus plugged in as revenue. The $41.3-million municipal budget is up about 4.5 percent, with the amount raised from taxes up 3.5 percent, to $29.7 million. The average assessed home ($133,000) paid about $2,276 in municipal property taxes last year, and Chief Financial Officer Frank Ruggiero expects roughly the same amount next year. He described a recent nj.com story about the budget wildly inaccurate and residents can expect tax bills for the first two quarters to be similar to the last two quarters.
A public hearing and final approval on the budget is scheduled for Monday during the City Council’s regular meeting.
More than 100 units are either rented (43) or sold (58) in Sky View at Carriage City Plaza, as of the end of last month. That would account for 101 of the 222 units in the 16-story complex. (Remember when half were under contract?)
City Administrator and Redevelopment Director Peter Pelissier told Redevelopment Agency commissioners during their meeting Wednesday night that another unit has closed and two more are under contract and may close soon. Pelissier said he was told by Carlos Silva of Carriage City Properties to expect a letter shortly regarding payment to the agency for the latest unit closing. It would be the first unit to close since early this year, with the most recent appearing in property transactions in April.
The agency’s settlement agreement with Carriage City Properties, however, remains unsigned. Pelissier told commissioners he would have more information at next month’s meeting and likely would require an executive session meeting to discuss “sensitive issues” and determine a course of action.
Carriage City began marketing rentals almost a year ago ($1,250 for a one-bedroom at the time, which has since increased to $1,350), in violation of their redevelopment agreement, which prompted discussions with the agency and ultimately a settlement.
The developer has until this month to execute the agreement or the city will reach out to the financing bank for information, said Pelissier, adding that they’ve heard little from Carriage City about how many units have been rented or sold. No units at Carriage City have appeared in property transactions since early in the spring.
There have not been any new temporary certificates of occupancy (TCO) issued for the building, according to Pelissier. Under the agreement, the Redevelopment Agency is supposed to receive 10 percent of the rent from each rented unit — only the city doesn’t know how many are rented and has yet to receive a dime from rents. Last we heard, there were about 57 units sold and about five rented while 76 TCOs had been issued at the 222-unit development.
So the “Coming Soon” sign at Mr. G’s a couple months ago wasn’t an exaggeration. It’s been open for more than a week, with an “official” grand opening planned on Monday. Last year we could barely find a cafe or coffee shop and now we can expect three by summer’s end (Kataluma Chai and Inthemix).
The Redevelopment Agency last night approved a settlement with Carriage City Properties (CCP) that will allow the developer to continue to rent unsold units at the 16-story condo/hotel.
CCP has sold about 57 units and began marketing vacant units for rent as early as last fall. Five are occupied by tenants and the city has issued 76 temporary Certificates of Occupancy in all at the 222-unit complex.
The two sides have been in discussions since the Agency declared CCP in default of its redevelopment agreement two months ago.
Here’s a summary of the settlement:
* CCP will execute a note and mortgage to secure the outstanding $2,285,250 in development fees and purchase price payments. The agency will get 10 percent of rent from each rented unit, which will be deducted from the $13,850 development fee until the unit is sold, at which time CCP will pay the balance. There are 165 remaining units.
* Infrastructure improvements, namely the East Milton Avenue and Irving Street realignment, cost approximately $1 million, of which CCP was liable for $368,562. The agency accepted CCP’s offer of $150,000, to be released immediately.
* Professional fees of $19,913 and water connection fees of $71,981 owed by CCP will be paid no later than April 1, 2010.
* Construction permit violations totaling $168,000 will be waived upon abatement of all issues identified by the city’s construction official.
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5/17 UPDATED: Between the intersection improvements and construction penalties waived upon correction, CCP got about 15 percent knocked off what it owed in total. City Administrator and Redevelopment Director Peter Pelissier described that as “small to the potential of a bankrupt redeveloper,” adding that the site pays almost $1 million in property taxes. Meanwhile, construction penalties usually are waived if violations are corrected as a matter of business, with the point to get conformance and have the building safe for occupancy.
Many builders, renters and retailers are trying to renegotiate contracts to stay solvent, he said. “This is no different. The RRA and the city need to work together with redevelopers and sometimes although not popular with the critics public improvements not private improvements have to be paid for by the taxpayer to receive acceptable returns.” While CCP has taken a lot of heat for not adhering to the redeveloper’s agreement, Pelissier said, they did complete construction.
It looks safe to say that Cuppy’s Coffee is D.O.A. in Rahway.
It looks like Carriage City Plaza has a new leasing agent. Paramus-based The Goldstein Group moved into the ground-floor of the East Milton Avenue corner of the building several weeks ago.
No word from Silcon/Carriage City about what
happened to the steakhouse — an unnamed “New Jersey institution” — that was in the works a year ago for that area. I’m sure you all have your guesses.
The dry cleaners at Carriage City has opened but it appears unlikely that Cuppy’s Coffee will move in next door (though Goldstein does label the space that way in their site plan). There remains a building permit on the front door of Cuppy’s — dated earlier this month — indicating alterations to the space for a “Mr. G’s.”