Title
Dept./ Agency: Economic and Housing Development
Action: ( ) Ratifying (X) Authorizing (X) Amending
Type of Service: Private Sale/Redevelopment/Subordination Agreement
Purpose: An Agreement to subordinate the City’s Reverter Rights by entering into a First Amendment to the Agreement for Sale and Redevelopment of Land and a Subordination Agreement in order to permit financing necessary for the redevelopment of rental or for-sale owner-occupied housing
Entity Name: Ascension Capital Partners I, LLC
Entity Address: 59 Lincoln Park, Suite 200, Newark, New Jersey 07102
Sale Amount: $116,099.20
Cost Basis: ( ) $ PSF ( ) Negotiated (X) N/A ( ) Other:
Assessed Amount: $0.00
Appraised Amount: $0.00
Contract Period: Not Applicable
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)
529 Springfield Avenue/Block 2614/Lot 1/South Ward
527 Springfield Avenue/Block 2614/Lot 2/Additional Lot 34/South Ward
521 Springfield Avenue/Block 2614/Lot 5/South Ward
461 18th Avenue/Block 2614/Lot 7/South Ward
459 18th Avenue/Block 2614/Lot 8/South Ward
457 18th Avenue/Block 2614/Lot 9/South Ward
15 Brenner Street/Block 2614/Lot 28/South Ward
9-11 Brenner Street/Block 2614/Lot30/Additional Lot 31/South Ward
608 South 10th Street/Block 2614/Lot 32/South Ward
606 South 10th Street/Block 2614/Lot 33/South Ward
Additional Information:
Resolution 7R2-b adopted on October 24, 2018, authorized the Private Sale/Redevelopment Agreement.
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WHEREAS, pursuant to Resolution 7R2-b adopted on October 24, 2018 the Mayor and the Deputy Mayor/Director of the Department of Economic and Housing Development were authorized to enter into and execute an Agreement for the Sale and Redevelopment of Land (“Redevelopment Agreement”) with Ascension Capital Partners I, LLC for the sale of land owned by the City of Newark located in the South Ward at 529 Springfield Avenue, 527 Springfield Avenue, 521 Springfield Avenue, 461 18th Avenue, 459 18th Avenue, 457 18th Avenue, 15 Brenner Street, 9-11 Brenner Street, 608 South 10th Street and 606 South 10th Street, identified on the official tax map of the City as Block 2614, Lots 1, 2, 5, 7, 8, 9, 28, 30, 31, 32, 33 and 34 (collectively, the “Properties”) for a purchase price of One Hundred Sixteen Thousand Ninety-Nine Dollars and Twenty Cents ($116,099.20) for the rehabilitation of the property to create affordable rental or for-sale housing (“Project”); and
WHEREAS, such sale was authorized pursuant to N.J.S.A. 40A:12A-8(g); and
WHEREAS, Ascension Capital Partners I LLC (“Redeveloper”) has secured financing from ------------Local Initiatives Support Corporation, a New York not-for-profit corporation (“Lender”), in the approximate, principal amount of One Million Two Hundred Fifty-One Thousand, Four Hundred Ninety-Seven Dollars and Zero Cents ($1,251,497.00) (the “Loan”), to develop the Project, which Loan will be evidenced by a Promissory Note in the principal amount, and will be secured by a mortgage on the Properties; and
WHEREAS, as a condition of the above Loan, the Lender has requested that the City subordinate its right to take back the Properties if the Redeveloper defaults (Reverter Right) to the mortgage; and
WHEREAS, pursuant to N.J.S.A. 40:60-51.2, “Any municipality is authorized and empowered, by resolution of the Governing Body thereof, to waive, release, modify or subordinate any terms, covenants, conditions, limitations or reverters imposed in sales and conveyances of lands as to the erection, alteration or demolition of buildings or any other use to be made of land heretofore imposed by said municipality to accomplish the purposes for which such lands were sold and conveyed either at public or private sale including those set forth pursuant to Section 21 of P.L.1971, c. 199 (C.40A:12-21), but only after public hearing held before such Governing Body, of the holding of which notice describing the lands in question, and the terms, covenants, conditions, limitations or reverters to be waived, released, modified or subordinated, and, if to be modified or subordinated, describing the manner in which the same shall be modified or subordinated, shall first have been given by advertisement published once each week for two weeks in a newspaper published in said municipality or, if no newspaper be published therein, then in a newspaper circulating in such municipality, provided, however, that the power herein granted shall not be exercised to impair any vested or contractual rights of third parties”; and
WHEREAS, the Mayor and/or his designee, the Deputy Mayor/Director of the Department of Economic and Housing Development have determined that the Project is in the best interest of the City and recommend subordinating the City’s Reverter Right to the Lender’s mortgage and making a modification to the Right of Reverter contained in the Redevelopment Agreement and the deed, so as to accomplish the Project.
NOW, THEREFORE, BE IT RESOLVED BY THE MUNICIPAL COUNCIL OF THE CITY OF NEWARK, NEW JERSEY, THAT:
1. The Mayor and/or his designee, the Deputy Mayor/Director of the Department of Economic and Housing Development, is hereby authorized to enter into a subordination agreement with ------------Local Initiatives Support Corporation, a New York not-for-profit corporation, 28 Liberty Street, 34th Floor, New York, New York 10005 (“Lender”) and Ascension Capital Partners I, LLC, 59 Lincoln Park, Suite 200, Newark, New Jersey 07102 (“Redeveloper”). Said agreement shall be substantially in the form of the subordination agreement attached hereto. It shall, in accordance with the terms and conditions of the Agreement for the Sale and Redevelopment of Land authorized pursuant to Resolution 7R2-b October 24, 2018, (“Redevelopment Agreement”), permit the rehabilitation of the property subject to said Redevelopment Agreement as rental, or for-sale, owner-occupied housing. All other terms and conditions of the Redevelopment Agreement shall remain in force and effect.
2. The Mayor and or his designee, the Deputy Mayor/Director of the Department of Economic and Housing Development, is hereby authorized to enter into a First Amendment to the Redevelopment Agreement with the Redeveloper. Said First Amendment shall be substantially in the form of the First Amendment attached hereto.
3. Notice in accordance with N.J.S.A. 40:60-51.2 of the subordination of the City of Newark’s reverter rights to the Lender’s mortgage has been duly given by publication as required by law, and a public hearing on said resolution being held at a Special Meeting of the Municipal Council on April 29, 2025, in the Council Chamber located at City Hall, 920 Mayor Kenneth A. Gibson Boulevard, Newark, New Jersey.
4. The Deputy Mayor/Director of the Department of Economic and Housing Development shall file copies of the fully executed subordination agreement and the First Amendment to the Redevelopment Agreement with the Office of City Clerk.
STATEMENT
This Resolution authorizes the Mayor of the City of Newark and/or designee, the Deputy Mayor/Director of the Department of Economic and Housing Development to subordinate the City’s Reverter Rights through the execution of a Subordination Agreement and First Amendment to Agreement for Sale and Redevelopment of Land, in accordance with N.J.S.A. 40:60-51.2, to enable the Redeveloper to obtain financing necessary for the rehabilitation of the property as rental or for-sale owner-occupied housing located at the Property.