L+M Development Partners and Prudential Financial have secured $100 million in financing to convert the Ralph Walker-designed Bell Building in Newark, NJ, into a mixed use property.
Operating as 540 Broad Street Owners LLC, the joint venture anticipates a mixed-income, mixed-used development with 263 residences – 20 percent of those affordable – and 80,000 s/f of Class A office and retail space at the building located at 540 Broad Street in Downtown Newark.
The New Jersey Housing and Mortgage Finance Agency (HMFA) is providing $15 million in Conduit Bond financing and federal 4 percent Low Income Housing Tax Credits (LIHTC), which in combination with historic tax credit proceeds on the affordable units are expected to generate an additional $9.4 million in private equity through Goldman Sachs Urban Investment Group.
Citi Community Capital provided approximately $70 million in construction financing and approximately $14 million in equity through the National Trust Community Investment Corporation., in combination with NJ Community Capital, allocated $14 million in New Market Tax Credits for project.
Construction on 540 Broad, the largest mixed-use, residential project under development in Newark, is now underway.
“L+M is proud to once again invest in Downtown Newark’s longterm future and its existing assets,” said Ron Moelis, CEO of L+M Development Partners.
“As with Hahne’s before it, we celebrate this formidable city by restoring one of its great buildings. From mixed-income housing to high-quality neighborhood-focused retail and Class A office space, this project will transform one one of the city’s architectural gems into a vibrant place to live and work, and marks another thoughtful adaptive reuse collaboration in Newark with our partners at Prudential, Citi Community Capital and the Goldman Sachs Urban Investment Group.”
Ommeed Sathe, vice president, impact investments, Prudential Financial, said it was important to the venture that 20 percent of the units were set aside as affordable housing.
ANd Margaret Anadu, Managing Director and head of the Urban Investment Group at Goldman Sachs, added, “We are thrilled to be part of the public-private partnership that will transform this historic landmark into a vibrant and catalytic hub to bring more jobs, affordable housing, and retail space to Downtown Newark.”
In addition to new market-rate housing, the joint venture has elected to set aside 20 percent of the homes at 540 Broad Street for families earning between 40-50 percent of Area Median Income.
Residences in the new project will be located on floors six through 20, with the lower floors consisting of office, retail and other non-residential uses.
Units at 540 Broad Street will consist of studios, studios plus dens, one- bedrooms plus dens and two-and three-bedroom units.
Amenities will include a fitness center, game room, bicycle storage, in-unit laundry, and a 24/7 doorman.
The Marketing Directors has been hired as the exclusive residential leasing and marketing agent for the property. The Prusik Group is the development partner responsible for the retail lease up, and Bozzuto Management is anticipated to act as the property manager for the entire property.
Built in 1929 and designed for the New Jersey Bell Telephone Company by famed architect Ralph Thomas Walker, the Art Deco building is known for its majestic lobby and brick-and-sandstone exterior, both of which were added to the U.S. National Register of Historic Places in 2005.
The building has been home to the regional offices of Verizon, which will continue to occupy the building’s 4th floor.
The development team is again working with Rutherford, NJ based Inglese Architecture & Engineering (IAE) for the new design and repositioning of the 20-story, 436,000 s/f tower, while asking CetraRuddy, the NYC based architecture, planning and interior design firm, to support IAE with knowledge and experience acquired from prior conversions of Ralph Walker buildings, including the Walker Tower.
The project is L+M and Prudential’s latest investment in the revitalization of Downtown Newark in partnership with the Goldman Sachs Urban Investment Group and Citi Community Capital.
Earlier this year, the partnership re-opened the historic Hahne & Co. building at 609 Broad St.
The department store, which sat abandoned for nearly 30 years, was transformed into a mixed-use complex with apartments and an arts and cultural center operated by Rutgers University.