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A Class A luxury apartment community set for Watchung has secured a construction loan and joint venture equity for the project.

JLL Capital Markets announced arranging the funds Aug. 8 for Blue Hill at Watchung, located on Bonnie Burn Road. According to the global commercial real estate and investment management company, total project costs add up to $102.87 million.

Comprising six four-story buildings as well as a two-story clubhouse, the community is rising on a nearly 42-acre site with 23 acres of preserved land. The property features a 30-year PILOT – Payment in Lieu of Taxes – agreement with the Borough of Watchung, JLL noted.

The team represented the sponsor JV, The Sterling Properties Group of Livingston and Caldwell-based Danbro Properties, to arrange the loan through First Citizens Bank, it said. JLL also said it arranged the sponsor’s joint venture equity partnership with Marcus Partners.

According to reports, the Boston-based vertically integrated real estate firm came on board in July. Construction is already underway.

Blue Hill at Watchung is planned as part of the borough’s Round Three affordable housing obligation. Of the total unit count, 46 apartments would provide very low-, low- and moderate-income non-age restricted affordable family rental units.

Senior Managing Directors Jim Cadranell and Jon Mikula, along with Vice President Michael Lachs led the JLL Capital Markets team.

“Blue Hill at Watchung represents an exceptional opportunity to develop a market-leading luxury apartment community in one of New Jersey’s most prestigious locations,” said Cadranell. “The strong sponsorship team, premier location with significant barriers to entry and comprehensive amenity package positioned this project for success in the capital markets.”

Situated near Interstate 78 and Route 22, the location offers commuters access to major roadways. Additionally, the site is less than 1 mile from The Connell Co.’s The Park campus. Beyond housing major corporate employers – such as L’Oreal, Celgene, soon Haleon and others – the massive site is undergoing a major repositioning. That work aims to create more than a corporate campus, with housing, entertainment and more to attract visitors.

Blue Hill at Watchung represents an exceptional opportunity to develop a market-leading luxury apartment community in one of New Jersey’s most prestigious locations.
— Jim Cadranell, senior managing director, JLL

The Blue Star Shopping Center is also nearby — and currently undergoing a multimillion-dollar redevelopment. So far the work at the 42,000-square-foot retail hub has attracted new tenants and delivered new spaces.

An affluent suburban community, Watchung boasts an average household income of more than $200,000, JLL said; meanwhile, median home asking prices top $1.2 million.

Blue Hill at Watchung is expected to achieve stabilization by March 2028, JLL said.