Title
Dept/ Agency: Economic and Housing Development
Action: (X) Ratifying (X) Authorizing (X) Amending
Type of Service: Redevelopment Agreement
Purpose: Authorizing Execution of Settlement Agreement and First Amended Redevelopment Agreement with A.P., LLC
Entity Name: A.P., LLC
Entity Address: 10 Mechanic Street, Suite 130, Red Bank, New Jersey 07701
Contract Amount: Not Applicable
Development Agreement Term: Not Applicable
City Contribution to Development Project: ( ) Grant or Loan ( ) Guarantee
(X) None ( ) Other:( )
Developer Investment: (Not Applicable)
Developer Third-Party Financing
Contract Basis: ( ) Bid ( ) State Vendor ( ) Prof. Ser. ( ) EUS
( ) Fair & Open ( ) No Reportable Contributions ( ) RFP ( ) RFQ
( ) Private Sale ( ) Grant ( ) Sub-recipient (X) n/a
List of Property:
(Address/Block/Lot/Ward)
686 South 16th Street/Block 359/Lot 33/South Ward
93 19th Avenue/Block 367/Lot 6/South Ward
39 Pierce Street/Block 2619/Lot 20/South Ward
41 Pierce Street/Block 2619/Lot 21/South Ward
797 South 15th Street/Block 2646/Lot 19/South Ward
189 Jelliff Avenue/Block 2662/Lot 30/South Ward
84 West Alpine Street/Block 2693/Lot 4/South Ward
80 Willoughby Street/Block 3051/Lot 45/South Ward
144 Leslie Street/Block 3065/Lot 8/South Ward
437 Jelliff Avenue/Block 3578/Lot 61/South Ward
276-278 Renner Avenue/Block 3625/Lot 7/South Ward
585 South 19th Street/Block 339/Lot 17/West Ward
319 South 18th Street/Block 1793/Lot 15/West Ward
290 South 19th Street/Block 1793/Lot 60/West Ward
113 South 9th Street/Block 1827/Lot 18/West Ward
108-110 South 13th Street/Block1859/Lot 59/West Ward
103 Alexander Street/Block 4059/Lot 8/West Ward
38 Palm Street/Block 4199/Lot 95/West Ward
33 North Munn Avenue/Block 4213/Lot 29/West Ward
31 North Munn Avenue/Block 4213/Lot 30/West Ward
Additional Information:
Original Redevelopment Agreement with A.P., LLC authorized by Resolution 7R2-I(AS) adopted by the Municipal Council on April 19, 2017.
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WHEREAS, the Local Redevelopment and Housing Law, N.J.S.A. 40A:12A-1, et seq., as amended and supplemented (the "Act"), authorizes municipalities to participate in the redevelopment and improvement of areas that are in need of redevelopment or rehabilitation; and
WHEREAS, in order to stimulate the reinvigoration of the City of Newark (the “City”), by Resolution 7Rdo(AS) adopted on June 15, 2005, the entire City was designated as an area in need of rehabilitation, pursuant to the Act; and
WHEREAS, the City had previously determined that the properties located at 686 South 16th Street (South Ward), 93 19th Avenue (South Ward), 39 Pierce Street (South Ward), 41 Pierce Street (South Ward), 797 South 15th Street (South Ward), 189 Jelliff Avenue (South Ward), 84 West Alpine Street (South Ward), 80 Willoughby Street (South Ward), 144 Leslie Street (South Ward), 437 Jelliff Avenue (South Ward), 276-278 Renner Avenue (South Ward), 585 South 19th Street (West Ward), 319 South 18th Street (West Ward), 290 South 19th Street (West Ward), 113 South 9th Street (West Ward), 108-110 South 13th Street (West Ward), 103 Alexander Street (West Ward), 38 Palm Street (West Ward), 31 North Munn Avenue (West Ward), 33 North Munn Avenue (West Ward) Newark, New Jersey, and identified on the Official Tax map of the City of Newark as Block 359, Lot 33, Block 367, Lot 6, Block 2619, Lot 20, Block 2619, Lot 21, Block 2646, Lot 191, Block 2662, Lot 30, Block 2693, Lot 4, Block 3051, Lot 45, Block 3065, Lot 8, Block 3578, Lot 61, Block 3625, Lot 7, Block 339, Lot 17, Block 1793, Lot 15, Block 1793, Lot 60, Block 1827, Lot 18, Block 1859, Lot 59, Block 4059, Lot 8, Block 4199, Lot 95, Block 4213, Lot 29 and Block 4213, Lot 30 respectively (the "Properties") are no longer needed for any public use and that rehabilitation of the Properties will contribute to the reinvigoration of the City; and
WHEREAS, the Municipal Council approved the West Ward and South Ward Redevelopment Plans, including any amendments thereto, for the Redevelopment Area within which the Properties are located (the "Redevelopment Plan"); and
WHEREAS, A.P., LLC, had previously submitted a Letter of Intent to the City’s Department of Economic and Housing Development outlining its intention to rehabilitate the Properties; and
WHEREAS, based upon the City's review of the Letter of Intent and other information, the City determined that A.P., LLC possessed the proper qualifications, financial resources and the capacity to acquire and rehabilitate the Properties; and
WHEREAS, pursuant to N.J.S.A. 40A:12A-8(g), the Department of Economic and Housing Development previously recommended that the City sell the Properties to A.P., LLC for the consideration of Two Hundred Thirty Thousand, Four Hundred Ten Dollars and Zero Cents ($230,410.00) ("Purchase Price"), which price, and under such terms as, the City deems to be reasonable, for the purpose of rehabilitating the Properties, in accordance with the Act, and the agreement between City and A.P., LLC, entered into in order to memorialize the terms and conditions or the sale and rehabilitation of the Properties (the “Original Redevelopment Agreement”); and
WHEREAS, the Municipal Council adopted Resolution 7R2-I(AS) on April 19, 2017, authorizing the execution of the Original Redevelopment Agreement and the transfer of the Properties; and
WHEREAS, A.P., LLC paid the Purchase Price for all of the Properties and acquired title to the Properties; and
WHEREAS, A.P., LLC did not redevelop the Properties in accordance with the Original Redevelopment Agreement and is therefore in breach of such Redevelopment Agreement; and
WHEREAS, the City retained certain reversionary rights to all of the Properties in the event A.P., LLC breached the Original Redevelopment Agreement; and
WHEREAS, A.P., LLC has asked that the City waive and forego its reversionary rights as to ten (10) of the Properties (“Retained Properties”) which by operation of law belong to the City and A.P., LLC committing to completing certain redevelopment of the Retained Properties (which the Redeveloper shall retain under the Settlement Agreement and First Amendment to the Redevelopers Agreement) on an expedited schedule and in no case later than nine (9) months from the approval of the Settlement Agreement and First Amended Redevelopment Agreement by the Municipal Council and allowing ten (10) of the Properties to revert back to the City (the “Reverted Properties”); and
WHEREAS, the Retained Properties are specifically identified as:
|
|
Street Address |
Block |
Lot |
Ward |
|
1 |
93 19th Avenue |
367 |
6 |
South |
|
2 |
108-110 South 13th Street |
1859 |
59 |
West |
|
3 |
39 Pierce Street |
2619 |
20 |
South |
|
4 |
41 Pierce Street |
2619 |
21 |
South |
|
5 |
797 South 15th Street |
2646 |
19 |
South |
|
6 |
189 Jelliff Avenue |
2662 |
30 |
South |
|
7 |
84 West Alpine Street |
2693 |
4 |
South |
|
8 |
144 Leslie Street |
3065 |
8 |
South |
|
9 |
437 Jelliff Avenue |
3578 |
61 |
South |
|
10 |
276-278 Renner Avenue |
3625 |
7 |
South |
WHEREAS, the “Reverted Properties” are specifically identified as:
|
|
Street Address |
Block |
Lot |
Ward |
|
1 |
686 South 16th Street |
359 |
33 |
South |
|
2 |
80 Willoughby Street |
3051 |
45 |
South |
|
3 |
585 South 19th Street |
339 |
17 |
West |
|
4 |
319 South 18th Street |
1793 |
15 |
West |
|
5 |
290 South 19th Street |
1793 |
60 |
West |
|
6 |
113 South 9th Street |
1827 |
18 |
West |
|
7 |
103 Alexander Street |
4059 |
8 |
West |
|
8 |
38 Palm Street |
4199 |
95 |
West |
|
9 |
31 North Munn Avenue |
4213 |
30 |
West |
|
10 |
33 North Munn Avenue |
4213 |
29 |
West |
WHEREAS, A.P., LLC has indicated that it would challenge and contest the City’s right to record a deed reflecting its reversionary rights to the Properties, including opposing the City’s legal action to quiet title; and
WHEREAS, the City has agreed that it is in the best interest of the taxpayers to avoid the expense of costly litigation to enforce its exercising its reversionary powers, and instead settle the parties’ differences by:
1. Requiring A.P., LLC to complete the redevelopment of Retained Parcels on an expedited basis and in no case later than nine (9) months from the execution of the Settlement Agreement and First Amended Redevelopment Agreement; and
2. Avoiding the cost of litigation by refunding A.P., LLC cost for the Reverting Properties, less the City’s costs; Reasonable and customary title Costs, Unpaid Taxes and Liens; and
3. Executing the Settlement Agreement and First Amended Redevelopment Agreement memorializing the foregoing.
WHEREAS, the City has agreed to allow A.P., LLC to change its membership composition by permitting the withdrawal of members, David Berkowitz and Niathan Allen (deceased) and permitting the election of Joaquim Seixeiro as the incoming and sole member of A.P., LLC; and
WHEREAS, the Settlement Agreement and First Amended Redevelopment Agreement shall supersede any previous Agreement(s) or conditions related to the rehabilitation of the Properties.
NOW, THEREFORE, BE IT RESOLVED, BY THE MUNICIPAL COUNCIL OF THE CITY OF NEWARK, NEW JERSEY, THAT:
1. The Mayor of the City of Newark and/or his designee, the Deputy Mayor/Director of the Department of Economic and Housing Development of the City, or either of them, are hereby authorized to enter into and execute the Settlement Agreement and First Amended Redevelopment Agreement in substantially the form attached hereto.
2. The Deputy Mayor/Director of the Department of Economic and Housing Development is hereby authorized to effectuate certain business terms and conditions related to the Settlement Agreement and First Amended Redevelopment Agreement and may enter into any related documents which may be necessary in order to effectuate the Settlement Agreement and First Amended Redevelopment Agreement.
3. The executed Settlement Agreement and First Amended Redevelopment Agreement shall be placed on file in the Office of the City Clerk by the Deputy Mayor/Director of Department of Economic and Housing Development.
4. The Project must be completed within the timeframe required under the Settlement Agreement and First Amended Redevelopment Agreement.
5. This Resolution shall take effect immediately.
STATEMENT
This Resolution authorizes the Mayor of the City of Newark and/or his designee, the Deputy Mayor/Director of the Department of Economic and Housing Development, on behalf of the City of Newark, to enter into a Settlement Agreement and First Amended Redevelopment Agreement with A.P., LLC.