A shopping center in Egg Harbor Township will receive up to $11.4 million in state incentives as part of series of incentives, investments and bond refundings approved by the Economic Development Authority’s board today.
The EDA board approved the Economic Redevelopment and Growth grant to the 270,000-square foot Gravelly Run Square shopping center’s developer, Benderson Development Co.‘s Buffalo Pike Associates holding company. ERG allows the project to apply expected future taxes toward financing the development.
The board also approved an increase in the Urban Transit Hub tax credits awarded to Boraie Development LLC, from $19.9 million to $23.8 million, for a project on Somerset Street, in New Brunswick. In addition, it approved investments in two venture capital funds, as well as refundings of tobacco and school-construction bonds.
Despite the increase in EDA incentives, the Boraie project is scaling back. While the original project would have totaled $108 million at two sites, the market has forced the company to scale back to $77.2 million at one building, 133 Somerset St. However, the financing gap increased, since Boraie is decreasing the projected rent while increasing the number of units in the building, from 197 to 238. The company also is dropping 45,000 square feet of office space and 130 parking spaces from the project.
Agency CEO Caren S. Franzini said the changes led to the increased financing gap that the tax credits would fill.
“You had a combination of more units and less rent,” making the project more expensive while lowering the amount available from banks, Franzini said.
Boraie Vice President Wasseem Boraie said after the board meeting that the assistance from the EDA is essential to the project, adding that the company still plans to build a second building at 120 Albany St. when the capital markets fully recover.
The board approved two limited partnership investments from the Edison Innovation Fund: $3 million with Osage Venture Partners III LP and $2 million with NextStage Capital II LP.
Osage managing partner Robert S. Adelson said the fund focuses on early-stage software companies with roughly $1 million in revenue. It currently has invested in 13 companies, including two in New Jersey. They are Edison-based FieldView Solutions Inc., which monitors energy use at data centers, and Moonachie-based Identropy, which aids corporations in identity management.
The bond refundings cover up to $1.165 billion in cigarette tax revenue bonds and up to $650 million in school construction bonds. The refundings depend on the savings to the state, Franzini said.
The board also approved several bonds and incentives for businesses, including a $10 million bond for fragrance company Robertet Inc. for a facility in Mount Olive and a $3.15 million bond for leather jacket maker Schott NYC for a facility in Union Township.
Franzini also announced that the authority reorganized its business development team, shifting from two regional teams to a pair of statewide teams that will cover business banking — focused on loans and bonds — and community development, which will focus on redevelopment and incentives.
