Category Archives: Uncategorized

Industry Braces for Impact of Tax Abatement Changes in Philadelphia

Philadelphia had a record-setting year for new construction in 2019, according to the number of permits issued by the city’s Department of Licenses and Inspections. The majority of the more than 2,100 permits issued were for single-family housing and most was in Center City’s surrounding neighborhoods. But developers fear a change in the 10-year tax abatement, which was passed at the end of last year, will slow the market and development.

Philadelphia has had a 10-year tax abatement of real estate taxes for new residential construction since the 1970s. It allowed developers to be tax-free for 10 years and was enacted to boost construction in the city. After a contentious debate, however, the legislation passed an amendment to the abatement. Now, the first year will provide developers with a 100 percent exemption on taxes, but there will be a 10 percent decrease per year after that. After 10 years, the tax exemption would end.

In a compromise to those opposed to the change, the new abatement won’t be implemented until December 31, 2020. There is some speculation this could produce a mini-boom of residential housing before the abatement ends in his current form, or boost new commercial real estate projects, according to Joseph Gibson, a researcher at commercial real estate services and investment firm CBRE.

One prominent building already under construction—the Arthaus condominiums from Dranoff Properties—will not escape the new tax law. The 108-unit, 47 story building at 309 South Broad Street is scheduled to be completed in 2021.

Transforming the Flushing River Waterfront in Queens with Mixed-Use Construction

The Flushing area of Queens on Long Island is looking to see some imminent improvements to the waterfront area. A couple of months ago, Hill West Architects revealed plans for an enormous complex of mixed-use buildings to be constructed in the 29-acre area. There are hopes that this will help to expand the downtown area, provide greater access to the waterfront, expand local housing and business opportunities, and only continue to improve the overall environment. The expansive footprint of this proposed project has led to citizens demanding an environmental impact in order to see assurances of their ecologically-friendly intentions. 

What Is the Pre-Project State of the Flushing River Waterfront?

The good news is that even before construction was to commence, the area has undergone numerous cleanup efforts, taking it from one of the most polluted waterways in the metro area with a notable “rotten egg” stench to marked improvement, as reported in late 2018. Major changes to the area included: 

  • Dredging 89,000 cubic yards of sediment, which on its own can adversely affect wetland areas, increase erosion, lower moisture, and make the environment less habitable for local flora and fauna;
  • Reworking the local sewer system to stop over 200 million gallons of sewage from dumping into the bay every year; and
  • Installing acres of new wetlands that help to filter the water and keep it clean naturally. 

It is not a complete fix, as recent reports suggest that heavy storms still lead to swelling, backed up sewage, and other issues. More than a year after news of improvements to the area, and still stink-free, the waterfront is on its way to transforming into another substantial way, including:  mixed-used properties, including more sorely needed low-income housing, to bring residents back to the area while still sustaining continued environmental improvements.

Moving Forward: Changes the Mixed-Use Project Aims to Bring

Hill West’s project is massive, spanning 29 acres of currently unused industrial space. A total of nine buildings are planned across the site. The project, assuming approval is imminent, should commence this year and is projected to continue, with a steady stream of construction work to follow through to 2025. Further specifics include:

  • A total rezoning of the area from industrial to residential. 
  • 1,725 new apartments, with around ten percent reserved for below-market-rate spaces.
  • 1,387,040 square feet of commercial space, to “include 298,811 square feet of retail, a 714,588-square-foot hotel, and 383,641 square feet of office space.” 
  • 21,913 square feet of community facilities.
  • 3.14 acres of publicly accessible open space and park area. 
  • 1,533 parking spaces. 

But for the rezoning, which is all paperwork, the rest consists of virtually every trade a team will need in construction, across four separate sites, to complete it. Hill West Architects revealed plans show an ambitious transformation over a large chunk of the local map. Pending approvals and impact reports can only reveal more details on how this change could change the local environment for better or worse

High Hopes for Mixed-Use, Transit-Oriented Project in East Brunswick

Commuting is often a necessary evil for New Jersey residents, but plans for a new mixed-used, transit-oriented development in East Brunswick aim to make it a little more pleasant—at least at the start and end of each day.

The $500 million project along the Route 18 corridor will have a bus terminal and commuter parking structure at the core of a site with 800 residential units, as well as retail shops, restaurants, a hotel, tech center, medical office building, outdoor amphitheater, indoor/outdoor pet facility, public plaza, and pedestrian walkways.

For those already worried about traffic in and out of the development, the plan includes the creation of parallel side streets to allow for alternate routes. And the developer, River Development, hopes to work with the state’s Department of Transportation to add a left-turn only lane onto Route 18 off of Edgeboro Rd.

The project will also revitalize the township, and specifically the 44-acre site on Route 18 between Ruth Street and Lake Street.

“This commercial corridor, one that sits right at the center of New Jersey, that still sees over 100,000 cars each day, that connects New Brunswick and Rutgers to the Shore, that sits at the cross-section of almost every major highway in New Jersey, that is equidistant between New York City and Philadelphia, is in desperate need of revitalization, and that is exactly what we’ve spent the last two years doing,” East Brunswick mayor Brad Cohen said earlier this month when the East Brunswick Redevelopment Agency released renderings for the project.

The project is expected to be three phases over the next five to seven years and, when it’s done, Cohen wants it to have something for everyone.

“We have aimed to create a true transit-oriented development which meets the needs of residents and consumers of the 21st century,” Cohen said. “We want to create a community that appeals to all age groups, including those starting out and those looking to downsize.”

Property acquisition continues and work will include the demolition of existing structures on the property, which is expected to begin this summer.

New York City FC in Talks to Build Soccer Stadium in the Bronx

After years of discussion and debate, it appears that the New York City Football Club is beginning to reach the more serious planning stages of bringing a soccer stadium into the city limits. They have everything but an official home, and that may soon change. Standing behind the project include developers like Madd Equities, the New York Economic Development Corporation, the Bronx Parking Authority, and the New York Yankees. The location in question would be mere blocks from Yankee Stadium, whose stadium has been home to the NYCFC’s games in the interim. 

How Might a New Stadium Affect the Area? 

According to NYC.gov, sports and recreation entertainment represents the smallest number of establishments and overall jobs in the metropolitan area. Just 100 establishments exist, bringing about 3,900 jobs, and this is in comparison to the next smallest number, the arts, with 1,800 establishments and over 18,000 jobs. It also brings in the smallest in terms of output, the only category in six that doesn’t break a billion dollars annually. In addition to that, their 3,900 jobs add up to over $350 million in wages paid each year, which is nearly identical to wages paid in total by the Venues category, which also has over 19,000 employees. 

Looking at the numbers as they are, it is very easy to see where adding additional sports establishments, where possible, might also bring more jobs and more profits, especially if these establishments are filling niches that don’t yet exist (in full or in part) in the greater area. The NYCFC’s proposal would do just this by giving a home to New York City’s very first soccer-specific stadium. 

The NYCFC Stadium Construction: A Focal Point in a Much Larger Project

Upon finalization, which is expected soon as of the posting of this article, the building of this 25,000-seat stadium will be part of a larger overarching project whose budget is in the ballpark of around $1 billion in total. There is also much more in the planning stages than just a stadium, the scope of which will transform the South Bronx in a number of ways. 

With the earliest date of completion projected for 2024 pending imminent approval, the following details are known

  • The current site for construction includes parking lots and an elevator parts factory owned by GAL manufacturing (and an agreement to purchase that property has already been reached).
  • The NYCFC’s soccer stadium, with its short distance to Yankee Stadium, can draw more sports fans to the area. 
  • Also, in the works would be affordable housing units, a school, retail space, and a hotel. This would bring additional housing for visiting teams, a diverse population of local fans, as well as businesses that would stand to benefit from multiple sports entertainment seasons each year. 

It’s suddenly very clear why so many development groups are involved in this proposal so far: the number of demo, construction, and landscaping jobs that stand to come out of this could be staggering.

Plans Continue To Turn Open Space into Parks in NJ and PA

The beginning of 2020 has seen a commitment from local government to turn open space into parks throughout the area.

In Mercer County, NJ, the county park commission approved a plan for the Miry Run Ponds Passive Park at Dam Site 21. The proposal covers the cleanup and conversion of 279 acres of county-owned space spanning Hamilton, Robbinsville and West Windsor. It will be turned into a passive recreation park with trail, walkways, playgrounds, a kayak launch and plantings to buffer nearby homes from the park.

In northern NJ, the Hoboken major reiterated the city’s commitment to coming to terms on a deal that would allow the conversion of the 3.15 acres of Union Dry Dock property into a waterfront park.

And in Eastern Delaware County, PA, the county council has declared that 30 acres of open space is OK for park use. The county released the Rosa Tree Park at Little Flower Manor Open Space Master Site Development Plan in Darby Borough. The master plan includes picnic groves, a walking trail connection to the Darby Creek Trail at the Woodburne Mansion property, as well as a community garden and an education center. An engineering study on the restoration of the historic 49,000 square foot Woodburne Mansion located on the property has not yet been completed

Topgolf Facility Breaks Ground Just Off the Long Island Expressway

With the promise for more entertainment venues in the Long Island area, the Topgolf brand has recently broken ground on its first New York location in Holtsville, just off the LIE. No official completion date has been announced, but sources report this development has already been long-awaited. The groundbreaking comes almost five months after reports that the brand had secured approval from Brookhaven planning officials back in September of 2019 with a 6-0 vote in favor. 

Will the Facility Be a Traditional Golf Course? 

With news over the last year of all manner of construction projects in the area of sports, eyebrows may rise with the notion of a new project with the keyword “golf” in the title. Short of club facilities and paved pathways, a typical golf course is usually 100+ acres of well-manicured outdoor landscaping. At a time of housing crisis, golf fans in the metro area might even question where one would also find the space. This is just one of the ways in which Topgolf differs and what probably made it an attraction for Long Islanders clamoring for more area sports. 

The Dallas-based company boasts that Topgolf is a game that anyone can play, featuring: 

  • Targeted driving ranges, with multiple game styles for your short game or challenges with friends and family,
  • Microchipped golf balls to measure distance and track records and game scores electronically, 
  • An attached sports-bar atmosphere with food and drink,
  • A multi-story facility with lots of room for entertainment, but a fraction of the size of a typical golf course at around 26 acres. 

The style of the games, with challenges for golfers and non-golfers alike, coupled with good food and a lively atmosphere, tend to be stronger selling points.

What Remains to be Completed, and How Will This Change the Local Landscape?

The site for construction sits between Zebra Technologies and Cheap Sam’s nursery. Before breaking ground, the area was previously wooded and without development. The plans available through the town of Brookhaven’s website show a sprawling, west-facing facility rising three full stories. With a $25 million budget, a facility of this kind must be constructed and fully wired to support an almost wholly electronic experience for players. Distinctive landscaping to accommodate a typical driver green plus the gaming targets are just the beginning, especially since it combines gaming with the trappings of a full restaurant and sports bar. Kitchens, dining areas, and other important additions will follow suit in the overall construction plan. 

Part of this project will involve seamlessly integrating with the neighbors, however. Concerns have been raised by locals living just north of the site regarding noise, light, and traffic. Since typical Topgolf locations close down at around 2 am, concessions are to be made, although Newsday reports that Topgolf was not required to change their hours of operation to obtain approval. However, along with the construction of the facility itself, an additional fence and trees will be constructed between the property and the nearby residents.

Mentoring Tomorrow’s Skilled Laborers and Business Owners

Year after year, the face of construction changes with aging infrastructure and buildings demanding attention from the contractor community and skilled labor force. The Bureau of Labor Statistics (BLS) stated that 61,000 more construction jobs were open in 2018 over the same period in the previous year.

In 2017, the National Association of Home Builders (NAHB), the largest network of craftsmen, innovators, and problem-solvers dedicated to building and enriching communities, conducted a survey and discovered 82 percent of respondents believe the availability and cost of labor will be an issue. 

Fast-forward three years to today, and NAHB membership was not mistaken. The challenge to meet the demand for skilled laborers, at an affordable cost, is nearly impossible, and the industry is feeling the effects, presenting an obstacle that requires a solution. 

Arthur Corwin, President of Railroad Construction Company, Inc., (RCC) in Paterson, NJ, states, “Our country has to repair its infrastructure. However, the construction industry lacks the capacity with both skilled craft labor and qualified contractors and subcontractors to safely complete the magnitude of work that is demanding our attention. What better way to fill this void than with an outreach program to MWSDVOBs. We all need this program to be successful if we are going to rebuild our nation.”

RCC is tackling this roadblock head-on, recognizing the answer far surpasses a quick fix. Established in 1926, RCC has developed from a railroad track construction and maintenance contractor into a complete turnkey operation, providing civil construction of facilities, bridges, highways, site work, and utilities. With nine decades in the industry, RCC is familiar with adversity and prepared to do what is required to provide the industry with skilled laborers who are equipped with the necessary resources to be successful.

After months of brainstorming and planning, RCC, along with coordinating and managing partners AEC Business Strategies and LDA Consulting, Inc. established the RCC “Training”-Express Mentor Program. 

The goal of the program is to foster effective long-term business relationships between women, minorities, and service-disabled owned veteran businesses in construction. Furthermore, promoting a diverse workforce. The team believes creating entrepreneurs and skilled laborers will foster new business and meet the demand to provide skilled laborers at a reasonable cost. 

Benefits of Diversity in Construction

Construction relies heavily on teamwork, and studies show that diverse teams are more engaged with one another. With the workforce becoming more diverse, companies will be ahead of the trend.

“There is a lot of competition in this industry, and there are many qualified people who perform a commercially useful function that struggle to compete with companies that have been in the industry for 20 years,” states Catherine Best. 

The goal of any company is to hire the best people. It is imperative that construction companies hire the most qualified workers, but why not create a pool of people from which to choose? 

According to a Gallup report, removing bias from the interview process and hiring on talent or skill alone, leads to 41 percent less absenteeism, 59 percent less turnover, and 70 percent fewer incidents.

Diverse Skills of Diversity Hires

Construction workers need to utilize critical reasoning skills to assess and fix problems. 

Diversity hires bring diverse skills to the team, different perspectives, and multiple problem-solving approaches.

If the goal is to complete work on time and budget, companies will benefit from Diversity hires, ultimately presenting additional opportunities to finish the project successfully. 

Catherine Best has worked with women-, minority-, and service-disable owned veteran businesses for several years and in varying situations, including the suppliers of goods and services to mentor-protégé programs. She can attest to the difference in skillset or ability when compared to non-MWSDVOB vendors is minimal. As Chief Compliance and Diversity Officer, Catherine supports and reinforces RCC’s dedication to performing a good faith effort through all phases of any construction project, allowing qualified subcontractors and suppliers the opportunity to work with an established contractor.

The RCC “Training” Express Mentor Program Process

RCC believes finding skilled talent starts at the high school level. College is not for everyone and mastering technical and interpersonal skills offers high school students alternative options and an employment advantage. 

“In order to secure the future of qualified MWSDVOBs, companies like RCC, who are committed to fostering the growth of MWSDVOB suppliers and subcontractors, have to be involved in providing the proper tools, training and internship opportunities. Without the contractor community support, new sustainable and diverse businesses will struggle to meet the demand, and the entire industry will suffer,” said Best. 

RCC has secured partnerships with the Paterson Charter School, New Jersey Chamber of Commerce, Bridging the Gap and the GI Go Fund to assist in recruiting students and veterans to fill the craft worker positions. Each session will include a program designed to target a Union Delegate presentation, interpersonal skills, and potential internship and employment opportunities.

The MWSDVOB will follow a similar program format, including presentations from utilities, contractors, and advocacy groups with the potential option for coaching sessions.

Chris Colabella, President of CISLeads, is one of the presenters, training companies to find the right projects to bid. “We’re excited to have the opportunity to help companies improve their skills and grow their businesses” said Colabella.

Applications for students, veterans, and MWSDVOBs are now available at Railroad Construction. The number of participants is limited. Should you have any questions, please contact the Program Coordinators.

Modular Construction: A Rising Trend for New York Builders

There are several construction challenges in the New York metro area, including rising demand for affordable housing, as well as the greater pressures laid on the shoulders of builders and firms to make up for budgetary shortfalls or face blacklisting. It’s therefore not a surprise that people in the industry have their ears to the ground for the next great idea that’s going to cut costs and delays without sacrificing quality. 

According to recent reports, modular construction may be the solution that New York City builders consider. While this method is seldom used, costs continue to increase, which appears to be outpacing any risk factors that kept it out of the running before. Current construction projects in the area that use modular methods include the AC NoMad Modular Hotel by Marriott the affordable housing structure at 581 Grant Ave, numerous other real estate ventures.

Modular Construction, In a Nutshell

For those that haven’t looked carefully at the process before, the words “modular construction” might hearken to mental images of trailers and the Sears catalog houses of yore: Prefabricated, cookie-cutter designs. In truth, the kind of modular construction that’s coming into vogue in NYC uses the same materials, techniques, and standards as your facility built the traditional way. The structure is broken down into sections, or modules, that are constructed in factory settings, then transported and fitted on site. 

What Kinds of Cost Benefits Are There to Modular Construction?

Modular.org reports that building in this way has many benefits, including: 

  • A safer, indoor work environment with fewer dangers for construction workers and fewer potentially costly liabilities;
  • Reduced material waste through careful control of inventory and recycling materials where possible;
  • Faster completion, up to 30 to 50 percent faster than conventional projects because work in the factory setting and the foundation can happen at the same time;
  • Fewer water delays due to weather, because the majority of construction is completed indoors, and more.

All of the above benefits have their ways of saving money, whether by reducing the cost of materials by reducing waste, or by eliminating a number of potential delays. The latter is especially crucial at a time when the law as it stands means penalties for construction firms that are deemed to be taking too long on certain projects. 

Despite the build-transport-assemble system, the result, once completed, looks no different than structures built on-site in a conventional way. 

Do Risks Outweigh the Benefits? 

There are likely several reasons, other than lack of awareness, that modular construction only accounts for about five percent of commercial construction projects. For instance, Million Acres reports that modular construction can pose a problem in a few instances: 

  • Transporting the modules poses its own unique challenges, given their size and delicacy.
  • Installing them once transported, especially in dense urban areas, will likewise be an issue to negotiate. 
  • Zoning laws, which differ from locale to locale, may prevent its use. 
  • While modular projects allow for lots of customization, it’s not as versatile as more conventional means. 

For now, a growing trend in using modular construction in commercial and residential ventures continues, with unusual optimism concerning cost-effective, affordable housing initiatives.

College Square Is a Delaware Redevelopment Project To Watch in 2020

There are many large development projects underway in Delaware this year. Among them is the redevelopment of a 325,000 square-foot shopping center into the College Square Williams Crossing Retail and Apartments in New Castle. The 46.10-acre property will now be the site for a mixed-use plaza with 305 residential units in two four-story apartment buildings.

Plans to renovate to the outdated retail center have been in the works for years, but the final plans were approved last March and demolition began in August. The residential units are expected to be primarily one and two bedrooms, with some three-bedroom units. The complex will also include a business center, fitness center, media room, and outdoor pool.

There will be some retail as well, with some stores, along with a coffee shop and restaurants expected. No tenants have been announced. New Castle-based developer Fusco Enterprises also plans to build a road through the center and offer some green space with a community plaza with tables and benches.

Previous renovation on the north side of the square will remain part of the new property. No timeline has been set, but Fusco attorneys have said the developer hopes to have it completed within two years.

LIC’s Urban Lab & Research Conversions

It might come as a surprise to some that there is an increasing demand for usable space for science labs in the New York City area, particularly space for life sciences. While it is easy to assume that this manner of work will take place largely in hospitals or on college campuses, in an area such as this, with community-wide efforts to improve human quality of life as well as the environment centered around human life, continuing research and more space to do it has come into very high demand, and rather than build new labs, converting existing structures has been the more common move. 

Just across the river from Midtown Manhattan, Long Island City is the site of one of the latest endeavors of this type, InnoLabs Life Sciences Facility. JLL Capital Markets has secured $156 million in financing for 45-18 Court Square, intending to refit it into a suitable property for a full life sciences lab and research facility. 

What Can You Expect of a Project Like 45-18 Court Square?

Currently, the Court Square property includes a 6-story office building with a freight elevator and a basement large enough for storage and equipment. It has more than 160,000 square feet of usable space, as well as another potential 100,000+ square feet of usable space. 

The intent is to convert this into a “purpose-built” lab facility with a few significant changes, such as:

  • Building a 4-story addition above the 2-story annex; and
  • Two ground-up additions on top of vacant parking lots, each 6 stories in height.  

Are There Certain Qualities a Building Needs to Be Suitable for Lab Setups?

A number of properties like 45-18 Court Square need upgrades and adjustments to be safe spaces for lab areas, to include improved electricals, making available loading areas, proper and safe ventilation, and more. The Court Square location, sources report, has several of characteristics going for it that already make it an attractive spot to start building, including: 

  • Quality and type of floor plates already present in existing structures;
  • The freight elevator setup, which makes transporting sensitive equipment and specimens much easier;
  • Its sizeable basement for storage; and
  • Ample square footage of developable space. 

Its central location in Long Island City is another characteristic that investors are hoping will make the finished property especially useful as this industry continues to boom. 

For Completion, What Remains to Be Done?

For bidders considering this or similar projects, the nature of the various tasks to be completed is present in the relevant details: Any firm taking this on can expect some refurbishing of existing systems, such as electrical and plumbing, including the need to ensure that sources of backup power can be secured. Multiple-story additions that meet the same standards as the rest of the facility are also on the docket. Firms are encouraged to keep a weather eye on the horizon for further updates. With continuing demand for lab research space in the metro area, Court Square will come up again, and so will similar opportunities.