Port Authority eyes new uses for Jersey City real estate

High-density residential developments adjacent to the Journal Square PATH station, in Jersey City, has prompted the Port Authority of New York and New Jersey to re-examine the transit hub’s retail and office space, and attract companies that cater to the community, according to a real estate official at the bistate agency.

High-density residential developments adjacent to the Journal Square PATH station, in Jersey City, has prompted the Port Authority of New York and New Jersey to re-examine the transit hub’s retail and office space, and attract companies that cater to the community, according to a real estate official at the bistate agency.

The authority recently launched a retail strategic study to develop a long-term plan for the transit center’s retail and office space, to follow up on a short-term study released in October 2009.

“The 2009 report indicated that food and convenience for commuters is something we are looking to put (in Journal Square) in the short term, and in the two years since, we’ve focused on small grab-and-go food establishments,” said Jerry Del Tufo, assistant director of real estate for the Port Authority. “But we’ve seen significant changes since then, and from a real estate perspective, 2009 may be obsolete.”

According to Del Tufo, more developers and businesses have taken an interest in leasing space in Journal Square as loans have become more available.

“Access to money is the driver here. Developers that we spoke to five years ago went dormant, but now they’re coming back, because banks are freeing up money a little bit,” Del Tufo said.

According to Del Tufo, drug store chain Duane Reade recently signed a 15-year lease to renovate its existing space in Journal Square’s transit center — which also accommodates bus traffic — to accommodate nearby residential developments, kicking off the center’s shift to community-focused retail companies. While Del Tufo noted that the renovation will allow the drug store to offer a wider array of products, the agency still plans to bring in a mix of tenants with different types of services, like sit-down restaurants and mom-and-pop delicatessens.

The agency expects employees from the new World Trade Center site to live in the new residential developments, so it will need to bring in businesses to Journal Square that can serve both commuters and residents, Del Tufo said. And one of the newest tenants in the retail plaza section of the transit hub is Hudson County Community College, so the agency will consider attracting businesses that provide services to students.

“Because we’re a public agency, we’re not going to develop a business model and hope that people come,” Del Tufo said. “We want to reflect what’s needed in the market. To do that, we have to understand our customer base, what our commuters are interested in and the needs of local residential developments.”

Del Tufo said the Port Authority will work with Jersey City officials to maximize the center’s potential as an anchor for business and, for the first time since the transit hub opened in the 1970s, it will look at the building’s 10-story, 120,000-square-foot office tower and 50,000-square-foot retail plaza as one component, to attract companies looking for both.

“In the past, no one wanted to put retail upstairs and out of the way,” Del Tufo said. “But now, we may have the opportunity to develop destination retail upstairs that would better suit the community.”