LONG BRANCH: The city and the owners of the Pier Village Phase 3 have come to terms on a financial agreement that will allow the developers to begin work on the project soon.
Council approved a redevelopment agreement with Kushner Companies and Extell Development earlier this month and during the Sept. 26 meeting unanimously voted to approve ordinances which grant a PILOT and project financing agreement. The financing includes a $20 million redevelopment area bond (RAB) that will finance public infrastructure improvements such as the new boardwalk as well as a carousel, children's play area and off-site parking.
The debt service on the RAB will be paid back to the city through annual, escalating payment in lieu of taxes (PILOT) to match increasing city-wide taxes and hotel occupancy taxes.
The city originally agreed to a $25.9 million RAB with Ironstate Development, the previous owners of Pier Village, before the group sold the property to the new owners for $200 million in 2014. Kevin P. McManimon, a redevelopment attorney who has been working for the city during the negotiations, said the RAB was reduced to $20 million which will increase the annual net benefit for the city. McManimon said that the RAB accounts for 7 percent of the total project cost of $283 million.
He explained that the PILOT will generate $23.5 million in revenue during its 30-year life span while the hotel occupancy tax will generate $4.1 million. Long Branch will net about $400,000 once the cost for municipal and education services are deducted from the $627,000 generated annually from the PILOT and hotel tax. That money will be used to pay down the bond each year.
City resident Vincent Lepore once again spoke out against the project financing during this week's meeting.
"You're taking money off the backs of Long Branch residents and giving it to New York residents," Lepore said.
Councilwoman Mary Jane Celli said she feels the project will be beneficial to the city and suggested that prevailing wage should be used paid to all workers to help stimulate the local economy.
The final stage of Pier Village, located just south of the existing development, will include new oceanfront condominiums, a 72-room boutique hotel, new dining and shopping options spread out over 42,300 square feet of retail space, a 370-space parking garage and public recreational amenities.
The developers will bridge the gap between the existing Pier Village boardwalk and the new one built by the city as well. The new and expanded public boardwalk will feature a carousel, a stage for community events, shade structures, public restrooms, and a children's play area with a mist park. Also included in the plans are additional public parking spaces and new stairways and ramps to provide beach access.
The new hotel will have a food and beverage component, oceanfront event space, and a luxury spa.
Long Branch Business Administrator Kevin Hayes said that with the steps taken by council this week, the project should be underway in the near future.
"That project should get going pretty quickly, they are anxious to get that moving," Hayes said.