EMERSON, N.J.—The Borough Council has authorized its attorney to take “all legal steps necessary”—including condemnation—against Emerson Redevelopers Urban Renewal (ERUR), the designated developer of the long-stalled downtown project at Citizen Emerson Station.
The action, approved during a closed session of the May 20 Borough Council meeting, comes after a potential rescue deal with RXR, a New York–based real estate firm, collapsed at the eleventh hour.
The project’s website still urges prospective tenants “to join our priority list and we will be in touch as we near our grand opening fall 2024.”
According to Resolution 159-25, Borough Attorney John McCann is authorized “to take all legal steps necessary against the redeveloper for Block 419 to enforce our agreements against the redeveloper and to proceed with condemnation,” and to retain legal and professional support not to exceed $17,000.
McCann said he would ask the council to allow the borough to take legal action following the breakdown of months of negotiations among RXR, ERUR, and the borough’s attorneys.
“We have to take some drastic steps to protect the taxpayers of Emerson,” McCann said. He described the redevelopment site as “essentially abandoned” and said the resolution would allow him and his team “to take any and all legal steps” they deem “appropriate to take.”
Mayor Danielle DiPaola said ERUR holds approximately $33 million in mortgage liens on the property. She said RXR—a “well-respected finance, investment and construction firm”—had approached the borough to explore a deal that would have completed the project and offset costs to taxpayers.
However, DiPaola said the plan fell apart after ERUR attempted to renegotiate terms at the last minute. “The redeveloper changed what we believed was a very fair deal and would have made the taxpayers of Emerson whole,” she said.
While it’s unclear what changes ERUR proposed, the mayor noted the borough sued the firm in June 2020 to recover $500,000 in construction services after Emerson failed to meet a Dec. 31, 2019 deadline to provide permits and a site for a new emergency services building.
McCann, previously authorized by council to pursue a breach of contract suit, said he held off due to ERUR’s financial instability and ongoing foreclosure proceedings elsewhere. He said that when the time came to finalize the new deal, it collapsed over ERUR’s last-minute requests. He called RXR “our last best hope” to move the project forward.
DiPaola expressed optimism that the borough’s legal action will create an opening for a new path forward.
“Hopefully this action that we will take will invite other qualified developers to complete this project so we have a wonderful center of our town,” she said.
Block used to ‘condemnation’
The redevelopment project itself was cleared under a previous administration that secured holdout properties on Block 419 in part under threats of condemnation and eminent domain.
In February 2018, the Emerson Borough Council voted 5–1 to approve an ordinance authorizing the use of eminent domain to acquire four privately owned lots on Kinderkamack Road—including Cinar Turkish Restaurant, Cork & Keg, and Ranch Cleaners—to make way for a JMF Properties redevelopment project.
The ordinance passed despite opposition from property owners, their attorney, and some residents. Then–Councilwoman Danielle DiPaola cast the only dissenting vote, objecting to the taking of personal property for a private development, then expected to yield millions in revenue.
The plan called for a mixed-use project with 147 luxury apartments, 20,000 square feet of retail space, a parking garage, and an affordable housing set-aside of 22–29 units—below the borough’s total affordable housing need.
Property owners’ attorney called the use of condemnation a “sham,” arguing that the borough was improperly tying the land seizure to its affordable housing settlement to avoid litigation.
At the time, borough officials, including the Land Use Board chairman, defended the move as necessary to revitalize the downtown, warning that rejecting the ordinance would amount to a “do not resuscitate” order for Block 419.
— With some background by John Snyder