Title
Dept./ Agency: Economic and Housing Development
Action: ( ) Ratifying (X) Authorizing (X) Amending
Type of Service: Private Sale/Redevelopment
Purpose: An Agreement to Subordinate the City of Newark’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 the Redeveloper to obtain financing, necessary for the rehabilitation of property to create an East Ward Affordable Housing Program
Entity Name: Community Asset Preservation Corporation
Entity Address: 100 Albany Street, Suite 250, New Brunswick, New Jersey 08901
Sale Amount: $3,360.00
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)
43 Cortland Street/Block 2483/Lot 40/East Ward
43 ½ Cortland Street/Block 2483/Lot 60/East Ward
Additional Information:
Resolution 7R3-a (s) adopted on March 11, 2014 authorized the for Agreement for the Sale and Redevelopment of Land for 43 ½ Cortland Street.
Resolution 7R2-e (s) adopted on May 24, 2022, authorized the Agreement for the Sale and Redevelopment of Land for 43 Cortland Street.
body
WHEREAS, pursuant to Resolution 7R3-a (s) adopted on March 11, 2014, the Newark Municipal Council (“Municipal Council”) authorized the Mayor and the Deputy Mayor/Director of the Department of Economic and Housing Development to enter into and execute an Agreement for the Sale and Redevelopment of Land (the “Agreement”) with Community Asset Preservation Corporation, 59 Lincoln Park, Suite 50, Newark, New Jersey 07102 (“Redeveloper”), for the sale of City owned property located and identified on the official tax map of the City of Newark (“City”) as Block 2483, Lot 60, and commonly known as 43 ½ Cortland Street, Newark, New Jersey (“Property”), in accordance with the Abandoned Properties Rehabilitation Act, N.J.S.A. 55:19-78 et. seq. (the “APPRA) and;
WHEREAS, pursuant to Resolution 7R2-e (s) adopted on May 24, 2022, the Newark Municipal Council (“Municipal Council”) authorized the Mayor and the Deputy Mayor/Director of the Department of Economic and Housing Development to enter into and execute an Agreement for the Sale and Redevelopment of Land (the “Agreement”) with Community Asset Preservation Corporation, 100 Albany Street, Suite 250, New Brunswick, New Jersey 08901 (“Redeveloper”), for the sale of City owned property located and identified on the official tax map of the City of Newark (“City”) as Block 2483, Lot 40, and commonly known as 43 Cortland Street, Newark, New Jersey (“Property”), for a purchase price of Three Thousand Three Hundred Sixty Dollars and Zero Cents ($3,360.00) for the rehabilitation of the property to create an East Ward affordable housing program; and
WHEREAS, the sale and Agreement were authorized pursuant to N.J.S.A. 40A:12A-8(g) and the East Ward Redevelopment Plan; and
WHEREAS, such sale was authorized pursuant to N.J.S.A. 40A:12-13, which requires that such conveyance be subject to the condition that title to the Property revert back to the City in the event of a Default under Section VI., Event of Default, Termination of the Agreement and Right of Reverter (mislabeled Section V.) of the Agreement and Section d. of the Deed (the “Reverter Right”); and
WHEREAS, Redeveloper has represented that it has secured financing from ------------New Jersey Housing and Mortgage Finance Agency (“Grantor”) in an amount not to exceed $400,000.00 (the “Grant”), to develop and complete the Project, which Grant will be evidenced by a Grant Agreement and will be secured by a Mortgage on the Property under the terms of the Grant Agreement; and
WHEREAS, as a condition of the above Grant, the Grantor has requested that the City subordinate the Reverter Rights to the Grantor with respect to the Grant Agreement and Mortgage; and
WHEREAS, the Agreement states that the Reverter Right may be subordinated by the City subject to formal approval by the Municipal Council and pursuant to N.J.S.A. 40:60-51.2, which authorizes a municipality 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 Department of Economic and Housing Development caused a notice to be advertised including the requirements established in N.J.S.A. 40:60-51.2, in the Star Ledger on January 24, 2025 and January 27, 2025, which complies with the notice requirement of once each week for two weeks; and
WHEREAS, the Municipal Council desires to subordinate the City’s Reverter Right contained in the Agreement and the Deed by entering into a First Amendment to Agreement for the Sale and Redevelopment of Land and Subordination Agreement 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 are hereby authorized to enter into and execute a Subordination Agreement with and in favor of New Jersey Housing and Mortgage Finance Agency (“NJHMFA”)(“Grantor”), in the form attached hereto or such other forms reasonably acceptable to the parties, related to the properties located at 43 and 43 ½ Cortland Street, Newark, New Jersey, as shown on the official tax map of the City of Newark as Block 2483, Lots 40 and 60 (the “Property”), which is located in the East Ward, to permit the rehabilitation of the Property to create an East Ward affordable housing program.
2. The Mayor and/or his designee the Deputy Mayor/Director of the Department of Economic and Housing Development are hereby authorized to enter into a First Amendment to Agreement for the Sale and Redevelopment of Land with the Redeveloper, in the form attached hereto, related to the Property for the Project.
3. All other terms and conditions of the Agreement for the Sale and Redevelopment of Land, authorized by and entered into pursuant to Resolution 7R2-a (s) adopted on March 11, 2014 and Resolution 7R2-e(s), adopted on May 24, 2022, shall remain in full force and effect.
4. Notice in accordance with N.J.S.A. 40:60-51.2 of the Subordination of the City’s reverter rights to the Property to the Grantor’s lien has been duly given by publication as required by law and holding of a public hearing on said resolution at a Meeting of the Municipal Council on February 5, 2025, in the Council Chamber located at City Hall, 920 Mayor Kenneth A. Gibson Boulevard, Newark, New Jersey.
5. The Deputy Mayor/Director of the Department of Economic and Housing Development shall place a filed copy of the fully executed Subordination Agreement and the First Amendment to Agreement for the Sale and Redevelopment of Land 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, to enable the Redeveloper to obtain financing necessary for the rehabilitation of the property to create an East Ward affordable housing program located at 43 and 43 ½ Cortland Street, Newark, New Jersey, as shown on the official tax map of the City as Block 2483, Lots 40 and 60 (East Ward).