The New Jersey Economic Development Authority has opened applications for its Construction Inflation Fund — a competitive program designed to address effects of COVID-19 on real estate developments, covering increased expenses to project delays.

The $10 million initiative offers grants of up to 20% of total project costs to small businesses for substantial rehabilitation, new construction and development associated with individual projects that have been subject to construction price increase and wider funding gaps due to the pandemic.

“We know for sure that there are projects out there that have run into some turbulence or worse because of supply chain challenges, inflation, interest rate spikes, which are certainly a COVID phenomenon,” NJEDA Chief Executive Officer Tim Sullivan told NJBIZ in January discussing the program.

Projects eligible for awards must have at least $5 million in total costs and can include:

• Commercial (including office)
• Manufacturing
• Mixed-use developments (residential portions must comply with the 20% reservation for low- and moderate-income households required by N.J.S.A. 52:27D-329.9(b))
• Warehouses (must be ancillary and in direct support of the site’s eligible primary uses)

Awards will range from a minimum of $500,000 to a maximum of $5 million, according to the program’s website. Grant funding may not exceed more than 20% of total project costs. Real estate developers are eligible to receive one award.

The Construction Inflation Fund was created with appropriations for “Real Estate Gap Financing” set aside in the state’s Fiscal Year 2023 budget through the federal American Rescue Plan’s Coronavirus State and Local Fiscal Recovery Funds.

Submissions to the Construction Inflation Fund are due by Oct. 19, 2023, at 5 p.m.

Applications are available here; the application fee is $1,000. Questions can be submitted to [email protected], NJEDA said.