HILLSDALE—A redevelopment agreement and long-term financial agreement to construct a 255-unit luxury apartment complex on a former waste transfer site on Patterson Street — estimated to generate nearly $40 million for the borough over three decades — was introduced with positive reviews from borough professionals at the July 12 Borough Council meeting.
Midway through the redevelopment presentation, Acacia Financial Group managing partner Jennifer Edwards said that the 30-year financial agreement being proposed would provide estimated annual revenues of $735,000, which adds up to nearly $40 million in revenues over the agreement.
Edwards, a financial consultant, has worked with the borough Negotiating Committee, and redevelopment counsel Joseph Bauman, in negotiating financial terms on the redevelopment.
A public hearing and council vote on a long-term financial agreement, also known as a PILOT (payment in lieu of taxes) agreement, will be at the Aug. 9 council meeting.
Prior to that, officials promised to post the financial agreements online at the borough website for public review. Generally, council meetings are posted the next day on the borough website.
If the agreements are approved on Aug. 9, the redeveloper must apply with a full site plan application to the Planning Board for its review and approval at future public meetings. The Planning Board review will be based on guidelines and zoning in the Hillsdale-Patterson Street Redevelopment Plan, which supersedes local zoning.
The redevelopment proposal provides 20 affordable housing units onsite, along with “community benefits” such as a public park on the corner of Patterson Street and Piermont Avenue and a community center at the complex’s northeast corner, fronting Patterson Street and Knickerbocker Avenue. The complex includes 381 off-street and on-street parking spaces.
In addition, officials said the redevelopment agreement provides for three payments of $250,000 each — for a total of $750,000 — to the borough based on specific project milestones.
Council also approved the hiring of DMR Architects for “not to exceed $199,000” to provide design services for a second community/senior center to be built at the Stonybrook Swim Club, though that move faced some public questioning and criticism at the meeting.
Ruocco opposed the resolution (see his letter to the editor) along with councilman Zoltán Horváth, but the motion was approved, 5-1.
Moreover, members Frank Pizzella and John Escobar urged seniors opposed to a so-called “second” community center at Stonybrook Pool to come to the Aug. 9 council meeting and tell council they do not want a center. Both believed that seniors wanted their own “space” and a separate facility.
Joseph Bauman, borough special redevelopment counsel, said the redevelopment agreement includes two phases. Phase I will be the approval and construction of a 255-unit, three- and four-story luxury apartment complex.
Bauman said as part of a density bonus granted the redeveloper (Patterson Street Urban Renewal LLC) which is an affiliate of CP Hillsdale LLC, comprised of Claremont Development and March Development, both or Morristown, a 5,000-square-foot indoor community center and 3,000-foot outdoor area will be built, with a 99-year lease to the borough.
He called it “one of the significant givebacks to the community.” He said a council subcommittee would help design the community center space.
A redevelopment agreement Phase II would be to allow the redeveloper a one-year timeline to acquire properties needed for construction of a 30,000-square-foot self-storage facility. He said should the redeveloper not acquire the needed properties, this development will not occur.
Jennifer Edwards, managing director, Acacia FInancial Group, said the financial agreement was “properly sized” for the project. She said the initial financial agreement proposed provides 95% of revenues to Hillsdale and 5% to Bergen County.
She said the redeveloper asked “for a land and improvement exemption” for a 30-year period. She said the borough will receive 10% of the development’s annual gross revenue in years 1–10; 11% in years 11–20; 12% in years 21–23; 13% in years 24–25; 14% in years 26–27; and 15% from years 28–30.
She said the borough’s first-year revenues would be estimated at $736,000, based on current unit rents. She said the borough will increase its annual tax income by nearly $700,000 annually. She said by year 16, the agreement provides incentives to move the property owner slowly back to paying conventional taxes, while providing maximum tax revenue to Hillsdale.
She said should rental income drop, the minimum annual tax payment to Hillsdale will be $500,000. “It will not drop any further than that,” she said. Edwards said the borough will receive an annual 2% “administrative fee” calculated on top of the annual tax payment.
She noted the borough will receive $735,000 in revenues from the redevelopment versus previously only $35,000. That accumulates to “just under $40 million for the borough” over the 30-year financial agreement, she estimated.
“Quite a substantial improvement from where we started with the developer,” Edwards noted. She said the borough would be getting an estimated $4 million more over the PILOT financial agreement due to adjustments they made.
She said the redevelopment “would not make any impact” to local emergency services needs, noting a new ambulance and new fire truck were already being discussed.
She said the project “was not the sole contributing factor for additional police” though more officers will be needed as local population increases.
Officials also noted, based on Rutgers University studies, the 255-unit, high-end complex, should likely only generate a maximum of 17 school-age children, based on the mix of market-rate and affordable units.
She said the additional tax revenues flowing from the redevelopment should allow the town “to absorb any additional costs” for the increase in school-age children.
DMR Architect Francis Reiner also detailed what Planning Board recommendations were accepted or rejected by the council in the re-introduced Ordinance 22-11 amendments to the Redevelopment Plan. The amendments were requested by the redeveloper, and reviewed by the Planning Board for consistency with the borough Master Plan.
Public weighs in
Much public comment focused on Resolution 22149 that hired DMR Architects for approximately $199,000 to provide architectural services for two site plan designs for a future community center at Stonybrook Pool. Ruocco said an estimated $2 million has been set aside for such a future center.
Ruocco criticized the resolution as a “second community center” which riled most council members, who stated that they had long pushed for a community center to be used mostly by senior residents. Councilman Frank Pizzella said the resolution hiring DMR to design a center was more for a senior center than a community center, and that the council always wanted a community space for seniors.
A community center is planned to be built and provided as part of the 255-unit, luxury apartment complex proposed, which is a “community benefit” provided to Hillsdale for the “bonus density” granted to the redeveloper to construct a 255-unit, three- and four-story two-building multifamily luxury rental complex.
Some residents raised concerns about increased traffic and whether traffic studies will be available prior to the Aug. 9 public hearing on the redevelopment financial agreement.
Resident Marc Goldberg questioned how annual revenues coming from the redeveloper will be audited. Bauman said the redeveloper will pay fees to the borough so it can hire auditors to verify the financial statements and payments coming to the borough.
Goldberg suggested the redeveloper should contribute toward any new ambulance or fire truck needed locally.
While some residents expressed concern about how many seniors favored a senior center, which was disputed by Ruocco and the council majority (excluding Horvath), some said they did not see the need for a separate senior center, while council members said they had mostly heard from local seniors who strongly favored such a center.
Concerns about maintaining a second community/senior center, as well as staffing or programming at the center, were also raised as possible obstacles to a separate facility for seniors at Stonybrook Pool.
Another resident questioned how much actual community support existed for a separate community center for seniors.
One resident calling in on Zoom wondered whether future rising rents at the 255-unit luxury rental complex might cause apartment vacancies and revenues to fall for the borough. Ruocco told her that the minimum annual payment to Hillsdale would be $500,000, unrelated to building occupancy.
She cited issues with rising annual rents at The James, a five-story, mixed-use, 240-unit residential/retail complex in Park Ridge, causing problems for tenants. Claremont Development built and previously managed the Park Ridge luxury apartment complex.
Ruocco said he “could not predict the future on that” and declined to give additional comment.