Tag Archives: mortgage crisis

Uncategorized

Catching up on some reading

Leave a comment

I’m a little late with this but in case you missed last Sunday’s Ledger, here’s their story about Union County home sales in the first half of 2009. It was a county-by-county breakdown of a larger project, “N.J. real estate bust hits urban home sales the hardest.”

Compared to the first half of 2008, “prices dipped 8 percent” in Union County, with only Elizabeth, Fanwood and Springfield seeing more home sales during the first half of this year compared to the same time in 2008. Berkeley Heights (0%) and Scotch Plains (7%) were the lone towns to see median home prices remain the same or rise over last year, and nine towns saw double-digit declines. Only Summit (2%) was up last year over 2005 median prices.

For Rahway, the analysis indicated a median price of $267,000 this year, compared to $307,500 last year (-13%) and $281,000 in 2005 (-5%). Those figures were still good enough to rank Rahway among the top third among the 21 Union County towns in both years, matching Clark and Mountainside in 2008.

The number of home sales was down 18 percent in Rahway for the first half of this year, which was about the ninth lowest rate within the county.

***

I also came across this New York Times piece yesterday. It talked about “municipal governments and arts groups pouring hundreds of millions of dollars into larger, flashier exhibit spaces and performance halls,” believing it was “the answer to what ailed cities everywhere — a way to lure tourists and economic development — and a potential boon to cultural institutions.”

The specific projects mentioned are of a much larger scale and in some cases very different, but it did bring to mind the $6-million expansion and acquisition of the local arts center by Union County, which also was pushed in part by the idea of spurring economic development earlier this decade.

The most provocative quote came from a senior fellow at the University of Chicago studying these projects: “These were situations in which ‘nobody actually asked: Is there a need here? If they build it, will they come?'”

_uacct = “UA-2976232-1”;
urchinTracker();

Uncategorized

A visit to Diversified’s ‘headquarters’

Leave a comment

The talk of foreclosure at Riverwalk and the story from North Carolina about another project abandoned by Diversified Communities got me curious.

I didn’t expect much when I paid a visit to the (former) “corporate headquarters” of Diversified this week and wasn’t disappointed. I’m not sure how long the Parsippany office of Diversified has been vacant, but Suite 110 most certainly is (photo above), despite being listed on the building directory. Actually, most of the building is empty except for what looks like one tenant (photo below).

Although Accent Title Agency hasn’t had its Web site shut down, unlike Diversified, phone numbers for both are disconnected. Accent is described as an independently operated affiliate of Diversified (.pdf, of a brochure), which was founded in 2002 by Ken Schwartz and Richard Weissman.

Almost all of the unsold 19 units at Riverwalk are those with balconies facing the Kings Inn motel and incinerator across Routes 1/9, City Administrator and Redevelopment Director Peter Pelissier said at Tuesday’s City Council meeting. Only seven of the 86 units have not paid their property taxes, he added.

***

Jim McKeon’s Broken Hearts Memorial, which was installed at Train Station Plaza this past summer, was picked by MSNBC in a Web-exclusive video story (2:29) this week. You can check it out here.

_uacct = “UA-2976232-1”;
urchinTracker();

Condos, Downtown, Foreclosure

Riverwalk not the only project Diversified ditched

Leave a comment

Riverwalk, with its last 19 unsold units going into foreclosure, isn’t the only construction project abandoned by Diversified Communities.

I came across this story in the Triangle Business Journal (Raleigh, N.C.) from last month about L’Hermitage, a project where Diversified had planned 125 condos, 75 townhomes and 35 single-family units. Only two were sold and barely two dozen completed in all. Work stopped in spring 2008 and the abandoned project is described as “the poster child for the housing industry’s downfall.“

Spring 2008 was about the time Diversified parted ways with DeBartolo Development on the Town Center project proposed for the City Hall property some three years ago.

Some key passages from the story:

— “Diversified Communities…walked away from the project in 2008, leaving two dozen homes in various stages of construction. Diversified…built the roads, sewer lines, water lines and power infrastructure…as well as a 5,000-square-foot clubhouse with a swimming pool and tennis court.

— “Diversified had sold two homes in the community for more than $480,000 each and had started construction on 12 condominiums and 11 other single-family homes when work stopped. Some homes are finished, others are about halfway complete. “It’s been more than two years since I’ve spoken with anyone at Diversified,” Apex Town Manager Bruce Radford said. “They walked away from millions in ground there already.”

— “In its unfinished state, the property has become the victim of vandals and neglect. A 3,200-square-foot unfinished home in L’Hermitage was destroyed by fire in mid-September. The clubhouse was severely damaged when a water pipe burst and flooded the building.”

_uacct = “UA-2976232-1”;
urchinTracker();

Uncategorized

Station stairs slated for replacement this month

Leave a comment

NJ Transit plans to replace the staircase on the east side of the eastbound platform this month. The stairs, at the corner of Irving and East Cherry streets, are expected to reopen Dec. 4, according to this advisory issued last month.

***

Here’s a nj.com story on the foreclosures at Riverwalk that we wrote about last month. It looks as though the developer, Parsippany-based Diversified Communities, defaulted on an $11.8-million loan from Bank of America.

_uacct = “UA-2976232-1”;
urchinTracker();

Foreclosure

Foreclosures begin on final 19 Riverwalk units

11 Comments

Bank of America has started to foreclose on the 19 remaining unsold units at Riverwalk, said Redevelopment Agency Attorney Frank Regan at the agency’s meeting last week. The city also has begun the process on seven of those units for failing to pay property taxes, according to City Administrator and Redevelopment Director Peter Pelissier.

Parsippany-based Diversified Communities built the 86 Riverwalk townhomes off East Milton Avenue several years ago and at one point had considered plans for another three dozen or so on the neighboring Kings Inn property. The last Riverwalk unit to sell (that I could find) went for $420,000 in the fourth quarter of 2008.

The city still is pursuing the developers for failure to complete improvements, including street paving and striping. Regan said he was contacted by an attorney for the homeowners’ association to determine whether the improvements could be completed and paid through a mortgage commitment or if the city could complete the improvements and assess the units.

The city and county did some paving work on Essex and Johnson streets in the spring and will pursue the developer in court for reimbursement, but other work remains, such as drainage.

***

Since we’re on the topic of foreclosure, here’s a Wall Street Journal story from yesterday about foreclosures hitting top-tier markets.

_uacct = “UA-2976232-1”;
urchinTracker();

Apartments, Arts District, Downtown, Rahway, Wheatena

On tap for 2008: Park Square, Sky View

19 Comments

Nothing Earth-shattering in the mayor’s State of the City address last night. The new year should bring with it the completion of Park Square and Sky View at Carriage City Plaza, which includes a Hotel Indigo. Mayor James Kennedy pledged that downtown redevelopment efforts would continue to see progress this year, despite a downturn in the national economy as a result of the subprime mortgage crisis.
The largest portion of the mayor’s nine-minute remarks focused on a new billing method for sewage. He expects the city’s assessment from the Rahway Valley Sewerage Authority (RVSA) to increase from $3.6 million in Fiscal Year 2007 to $6.1 million in FY 2010, or almost 70 percent in the next three years.
Speaking of the subprime mortgage mess, what effect has it had on Rahway’s plans? I happened to pose that question to City Administrator and Redevelopment Director Peter Pelissier just last month, after reading about Asbury Park’s problems, and one Hoboken developer switching condo projects to rentals because of the housing market.
Pelissier said the city hasn’t been adversely affected by the real estate market — in terms of redevelopment — and rattled off an update on a number of projects:
* Park Square (rentals) has made plans to take out permits for the second building, which will face Main Street.
* Dornoch I (Main and Monroe streets) has taken out permits for The Savoy (36 units for purchase with 7,000 square feet of retail).
* Station Place (Five stories, with 80 units and 132 parking spaces, on Campbell Street between Elm and Cherry, for purchase) is still in the process of acquiring properties and relocating the main tenant, A&M Tool Co.
* Wheatena (Elizabeth and West Grand avenues) has requested assistance on the acquisition of properties for its 200-unit project (for purchase).
* Renaissance at Rahway, 72 units with underground parking, also requested assistance of the Redevelopment Agency to acquire the remaining three properties necessary to control the site (Triangle Inn area on Monroe Street). Five of the eight properties necessary are under contract.
* The Town Center project in the City Hall area is still being discussed, and the potential developer is negotiating with retailers as well as the property owners on the site. “As you can imagine this project is complex and will take some time to coordinate all the components of a project this size,” Pelissier said.
If a developer wanted to convert a condo project to rentals, as in some towns, the developer would have to come before the Redevelopment Agency again for approval, he said.
“Each week developers contact the mayor or myself inquiring as to the possibilities of developing in Rahway,” Pelissier said. “Also take a look around the downtown area, properties are being improved in the Arts District as well as throughout the downtown. This points out the small investor continues to believe in the future of Rahway as well as the larger developers.”
The mayor also mentioned that City Council has authorized demolition of the Hamilton Laundry site. I’ll have an update and potential timeline on that later this week.

_uacct = “UA-2976232-1”;
urchinTracker();