The requirement that only a jazz club/restaurant can be developed at the former Kelly’s Pub property looks like it will be lifted by the Redevelopment Agency, allowing other options to be pursued for the site.
Continue reading Restriction likely to be lifted for jazz site
Years ago, the Redevelopment Agency agreed to sell the former Kelly’s Pub on the condition that the property at the corner of Irving Street and Seminary Avenue be turned into a jazz club and restaurant.
Serious financial issues have plagued the proposed KC Jazz Club to the extent that developers would like to explore selling the property as a simple tavern — only they would need the agency’s approval first. In a Sept. 19 letter to the Redevelopment Agency, Union-based attorney Ronald Esposito, representing E.T. Building, LLC, asks for a meeting to discuss issues in hopes of resolving “what appears to be a very serious financial problem.”
“The only possible way my client can recoup some of their money and reduce their loss, would be to explore the sale of the property and liquor license without the restriction that the facility must be a restaurant/jazz club,” Esposito wrote, adding that Realtors have indicated it would be easier to sell the property without the restriction that a jazz club and restaurant be built.
The property, at 1646-1654 Irving St. (Block 162, Lots 5-7), was acquired for $398,000 in April 2004, according to PropertyShark.com, and pays about $5,500 in property taxes. Only a few weeks ago, the KC Jazz Club website was still active, featuring the rendering below, and proclaiming a 2012 opening. The website was suspended sometime in the past couple of weeks.
City Administrator and Redevelopment Director Peter Pelissier said the attorney should be advised to come before the agency with an update. He told commissioners that the agency “shouldn’t just arbitrarily approve it” but wait for the applicant to present a plan for what to do. The intent of the redevelopment agreement, and the agency selling the property, was for a jazz bar/restaurant, Agency Attorney Frank Regan said, so they would have to come back to the agency for approval to make it simply a tavern.
Esposito details issues the developer has had with financing, including an original $1.5-million mortgage from RSI bank that fell through and a partner defaulted on sale of another property, the proceeds of which would have helped to fund the jazz club effort. Over the past three years, Esposito writes, his client has reduced the cost of the building from $2.3 million to $1.7 million in a failed effort to secure financing from a bank and then private investor. He claims that the anticipated value of the building was agreed upon at $1.75 million when completed ($2.3 million with the restaurant operational).
The bank was to extend a mortgage of $1.5 million, which was reduced to $1 million, Esposito said, which may or may not still be available since about six months ago RSI insisted on payment of the initial $400,000 mortgage money advance used for the property and monthly payments of $2,685 since April. [You can read the full text of the letter here.]
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| What site looked like two years ago |
In addition, Esposito explains that since December 2005 contract entered into with the agency, his client had to purchase a liquor license for $40,000, and pay annual licensing fees of $2,100 to the city and $200 to the state. He also details $32,000 in costs to obtain Department of Environmental Protection (DEP) permits, $15,000 in costs to obtain variances from the city, and $120,000 for engineering and architectural planning.
In a postscript (P.S.) to his letter, the attorney suggested that due to the length of time involved the agency consider, as an alternative, the temporary abatement of taxes and ABC fees until the matter is resolved.
Readers who’ve long been asking “When’s Bachmann’s reopening?” finally have their answer. The Zoning Board of Adjustment on Monday night gave unanimous approval of minor changes to an application that was adopted several years ago.
Not that it’s any surprise but don’t expect KC Jazz Restaurant to open during 2010.
Redevelopment Agency Commissioner Courtney Clarke inquired about the status of the project during the March 24 Redevelopment Agency meeting.
City Administrator and Redevelopment Director Peter Pelissier said the project at the corner of Irving Street and Seminary Avenue is not likely to be realized this year. Developer Casey Granieri is expected to go out to bid again and resubmit quotes to the bank, which had advised him to reduce the costs of the project by $500,000, Pelissier said.
KC Jazz restaurant has its sights set on 2010 for an opening.
Developer Casey Granieri said in an email last month that the project is going out to bid after a redesign to lower the cost. Any changes will be in materials and roof modification, he said, and if everything gets done in a timely manner it will open next year.
During last month’s Redevelopment Agency meeting, Redevelopment Director and City Administrator Peter Pelissier mentioned that a developer with experience in Newark’s Ironbound section was brought in to help with the changes while there also were some financing details to iron out. The former Kelly’s Pub building, at the corner of Seminary Avenue and Irving Street, gained Planning Board approval in July 2007.
It looks like there’s a comfortable lead for Friday to be the day for a Rahway Rising happy hour. If no one has any objections, why don’t we call it 6 p.m. at The Waiting Room this Friday (Nov. 13). See you there!
Construction at KC Jazz restaurant could take anywhere from six to nine months and should start soon, according to developer Casey Granieri, who’s waiting for construction bids.
The former Kelly’s Pub building at Seminary Avenue and Irving Street received Planning Board approval (.pdf) last July. The renovated structure will have a capacity of about 100 people and feature a 1,400-square-foot patio and distinctive 37-foot tower. The second floor will include two two-bedroom apartments.