Tag Archives: Main Street

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Dornoch ‘dead in the water’ on The Savoy

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“We’re dead in the water right now.” That’s how Glen Fishman, managing partner of Dornoch Holdings, described to Redevelopment Agency commissioners his firm’s situation with The Savoy.

In a rare appearance at the agency’s meeting Wednesday night, Fishman was invited to provide an update on the firm’s stalled projects and activity at its properties. He started with the good news (filling rental properties), but we’ll get to that in our next post. For now, the bad news.

“We’re a little stuck here, I wish I had better news,” Fishman told commissioners, adding that they’re still negotiating with Wachovia. Rahway’s real estate fundamentals still exist, with its location and proximity but housing prices have made it hard to get people to invest. “People are still confident in Rahway, it’s just the economics,” he said. Condos can’t be built when they’re selling for $150,000 a unit, he said, but expressed confidence in “getting something there” in 12 months.

Dornoch spent a lot of money acquiring properties along Main Street for the four-story, 36-unit development, many of which were razed. Archaeological and historical issues relating to cisterns at the Savoy site cost Dornoch $1 million and a year’s time, he claimed, which “blew the budget on the Wachovia loan.” At one point there was a possibility of financing from Valley National for rental apartments but the deal could not get done, he said.

Fishman told commissioners he hopes “at some point the economics make sense, whether selling to another developer who can make it work” or otherwise. Dornoch has fielded offers from some local developers, he said, but so far three offers that have been made “have not been acceptable to the lender.”

(By my estimate, via PropertyShark and other sites, Dornoch acquired almost 20 downtown parcels at a total cost of almost $9 million or more — mine may be an incomplete list — pretty much the height of the real estate market in 2006.)

Redevelopment Agency Chairman William Rack asked if the steel beams, which went up at The Savoy site in summer 2008, might be taken down at some point, assuming they probably won’t be used in whatever ends up at the site. Fishman said it’s not necessarily a certainty that the steel would go unused. Steel doesn’t really go bad so it still has value, he said, adding that Dornoch doesn’t have the money to remove it anyway, and doing so might actually reduce the value of the property.

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Commercial, Downtown, restaurants, Retail

Little Portugal ‘coming soon’ to former Nile space

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A restaurant called Little Portugal is “coming soon” to the former home of The Back Porch and The Original Nile.
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Commercial, Downtown, Rahway

Salon, bakery sought for East Cherry Street

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Hoping to fill two vacant storefronts, a local property owner came before the Redevelopment Agency last month for assistance but it looks like the locations will remain vacant for now.

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Guest blog post: ‘Change’ that works?

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Note: This is a guest blog post submitted by a reader under the pseudonym, Silence DoGood. While I may frown on anonymous comments on blog posts, this is not anonymous; I know who the writer is, however, they hope the merits of their arguments (not their identity) will carry the day when it comes to passing judgment on what they present. And in case you’re wondering: no, the writer is not me, nor is it anyone running for office. Both major party candidates for mayor have been invited to submit a guest column in the coming weeks.

***

Dear Neighbor,

Perhaps you had the benefit of receiving a letter from our fine City Council At-large members and our county freeholder, Rick Proctor, seeking support in the Democratic primaries in June. I don’t normally take to commenting on things but it seems like with all things in life, there is a time and a place. This time it came to my mailbox and while I realize that the challengers lost, I think this will be a similar argument against the Republicans or any other challengers to the established Democratic Party candidates.
A great many things have occurred to me recently but I will get to those in due time. For now, two items catch my notice. First, the letter described what can only be conflicting if not altogether hypocritical stances. “We are proud of the accomplishments and represent ‘Change that Works for Rahway,'” and yet just a few lines down, they note “now is not the time for on the job training.” So what type of change do we need here? Or is this similar to — and I hate to use this as a reference — Fox News (9:10 of video), which slams polls when they support Obama and then touts those same polls when they serve their interests, like stopping universal health care.
Secondly, “Change that works”… yes, we do have a hulking new hotel downtown, and certainly there are other projects that were built over the past eight to 10 years or so, like the parking deck across from the refurbished train station. But are they all working for Rahway? The mailing mentioned three items/issues that Democrats appear to have a handle on: stable property taxes, economic growth, and preservation of quality of life.
Stable property taxes
Does anyone remember the sewer fees that were separated from our property tax bills that were supposed to save us tax hikes — but left us with quarterly bills for water and sewer charges that, according to my math, are actually a hike? Check your old property tax bills against your last year’s worth of sewer bills if you don’t believe me.
Economic growth
What about the heap of dirt that sat across from the unfinished construction on Main Street, which at one time eventually became covered with grass and weeds because it sat so long. I hear we have a great new piano for loan but hardly a pedestrian on the street to listen to it, even if it was played. And do you recall the lawsuit with overzealous developers just across from the library that leaves the city and us taxpayers holding the tab for street improvements?
Quality of life
I know it is subjective but could an uglier building (the new hotel) have been built, any more out of scale with the downtown? One that I hope won’t become public housing considering lawsuits, lack of residents and possible foreclosure. I believe it took three years for sidewalks to go back on Main Street in front of the rusted steel fingers pointing to the sky, as if asking when they will be covered with walls and a roof.
Perhaps less subjective is the lack of attention to the repair of the steps at the NJ Transit train station. Why aren’t our city representatives being more proactive on our behalf to have this fixed?
A pocket park on the corner of Monroe and Essex? Maybe I’m not as progressive as some, or don’t quite think we have the same feel as say Brooklyn, or am I just not impressed with the other pocket park across the street from the arts center — which cost taxpayers a pretty penny. Smells more like a favor to a political supporter…
Or is this the change that all incumbents say you shouldn’t offer their opponents? To be honest, I can’t remember a time in the recent past when times weren’t a little difficult for the average citizen in this country. I’m not sure their opponents can do a better job and, to be fair, there have been accomplishments to the town that I have overlooked. But is it really fair to claim that change that works for Rahway means not giving someone else a chance to serve our community? Have they cornered the market on good change?
I have other thoughts, but I will save them for another day and another letter.

Sincerely,
Silence DoGood

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Commercial, Downtown, Retail

Kataluma Chai closes up shop

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Kataluma Chai Company closed as of Sunday, lasting less than a year at its Main Street location. The coffeehouse opened in October 2009 at 1470 Main St., subleasing about 650 square feet from the neighboring Niece’s Pieces, at the corner of Main and Lewis streets.

An announcement was posted in the windows of Kataluma Chai on Sunday (click image below to enlarge):

Dear Customers,
We regret to inform you that Kataluma Chai officially closed its doors on Sunday, September 26th. We appreciate all of the support you have given us over the past year. It has been our pleasure to serve you, and as an new business in downtown Rahway, we thank you for your warm welcome. We hope that you will continue to support local businesses during these tough economic times. Thank you again for your support.

Sincerely,
Kataluma Chai Owners
sales@katalumachainj.com

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Lot B parking project coming soon

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A story in The Star-Ledger/nj.com earlier this month included a couple of tidbits about two downtown projects:

* The plan to add about 100 parking spaces to the existing 65 at Lot B could break ground this month and be ready by October. Dornoch at one point had planned to build The Westbury, a mixed-use, 152-unit residential structure with accompanying parking deck.

While that project is on hold, the Rahway Parking Authority will lease the lot from Dornoch for $1 a year in exchange for property taxes being waived, according to interim RPA director Leonard Bier. The lease is for two years, with an option for a third, but could remain for as long as five years, according to City Administrator and Redevelopment Director Peter Pelissier.

Dornoch bought up several Main Street parcels about four years ago that now make up the site. Collectively, the property taxes on the sites were about $25,000 — when occupied by buildings — according to records at PropertyShark.com. Taxes are likely to be considerably lower because the structures have since been demolished.

Pelissier said there is demand for parking and if the Parking Authority can lease each of the 100 spaces at $65 per month, it would more than make up for the property taxes that the city would split with the county and school district. (At $65 per month, 100 spaces would generate $78,000 annually). The Parking Authority sometimes sends money back to the city at the end of the year, he added, in some cases as much as $75,000.

* Glen Fishman of Dornoch said financing is still tough to come by but even if construction financing could be secured for The Savoy, “it would take three to six months before we remobilize.” A July 2009 Ledger story quoted Fishman saying work should begin on The Savoy within a month.

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City Council

Council moves forward on Green Acres plan

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The City Council unanimously approved a $1-million application to the state Green Acres program aimed at bringing a pocket park to the corner of Monroe and Essex streets.

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