Restored Landmark to Provide 160 Units of Mixed-Income Rental Housing for Working Families
NEWARK, N.J.–The New Jersey Housing and Mortgage Finance Agency (HMFA) joined City of Newark Mayor Ras Baraka, and representatives of L+M Development Partners Inc., Prudential Financial, and the Goldman Sachs Urban Investment Group to celebrate the groundbreaking of the Hahne’s Building Conversion, a new mixed-income rental housing community in Newark, Essex County. The development will involve the rehabilitation of the iconic Hahne & Company department store building and the new construction of a nine-story building to provide 160 mixed-income studios, and one- to three-bedroom units for working families, and approximately 80,000 square feet of retail and commercial space.
The HMFA, an affiliate of the New Jersey Department of Community Affairs (DCA), provided the Hahne’s Building Conversion over $66 million in financing through its Multifamily Conduit Bond Program. Additionally, the agency approved the development project for the 4% federal Low Income Housing Tax Credits (LIHTC) of up to $13 million over ten years.
“We applaud the redevelopment efforts of the Hahne’s Building, which is the result of a collaborative public-private partnership between the New Jersey Housing and Mortgage Finance Agency, New Jersey Economic Development Agency, the National Park Service, Prudential Financial, and the Goldman Sachs Urban Investment Group, and the project developer L+M Development Partners Inc.,” said DCA Acting Commissioner Charles Richman, who also serves as Acting Chairman of the HMFA board. “This mixed-use, mixed-income housing community will not only deliver quality affordable housing opportunities to hardworking families in Essex County, but also introduce new investment to the community.”
The site is ideally situated for much needed housing for working families in the area. Located at 609-633 Broad Street in downtown Newark, across from Newark’s Military Park, and adjacent to the new 20-story Prudential office tower, the former department store site is surrounded by many residential and retail uses, Rutgers University and NJIT buildings, recreational centers, and cultural centers including NJPAC and the NJ Historical Society. Several NJ Transit bus stops and light rail stations, shops and restaurants, and places of worship are also within walking distance.
In addition to its great location, the Hahne’s building will bring income diversity to Newark. Among the 160 residential units, 95 will be market rate, and 64 will be affordable to households making 60% or less than the area median income. Unit amenities will include ranges, refrigerators, air conditioning, garbage disposal, and dishwashers, while building amenities will include a 24-hour lobby attendant, green terrace, community room, and laundry facilities. Whole Foods Market has already signed a lease to occupy approximately 29,000 square feet of commercial space on the ground floor of the historic building, while Rutgers University signed a lease to rent approximately 49,000 square feet across three floors.
Built in 1901 by prominent local businessman Julius Hahne, the Hahne & Company department store building was described as “one of the largest and most elegant stores in America” at its opening by the Newark Daily Advertiser. Over time, the store went though several changes in ownership, and eventually closed in 1986. After being eyed for various redevelopment plans including luxury apartments and revitalized retail space in the 1990s to no avail, the historic building is finally being redeveloped into a mixed-use, mixed-income community.
“The HMFA is thrilled to provide over 65% of the total development cost of this adaptive reuse project that will transform a national landmark—once a crown jewel of downtown Newark shopping—into a modern residential and retail community,” said HMFA Executive Director Anthony L. Marchetta. “Our Multifamily Conduit Bond Program, which alone will cover over half of the project’s total development cost, enables well-capitalized developers to issue bonds through the agency on a pass-through basis at the most competitive interest rates available in the marketplace.”
HMFA estimates that the Hahne’s Building Conversion, which will cost a total of approximately $121 million to develop, will generate approximately $192 million in one-time economic output, approximately 1,148 direct and indirect/induced full-time jobs, and $7 million in state and local taxes during construction. Upon completion, the project will continue to add value to the community by providing more than $21.4 million in ongoing economic output, 121 direct and indirect/induced full-time jobs, and approximately $1.2 million in state and local taxes annually. Other funding sources for the restoration of Hahne’s include Citibank, the New Jersey Economic Development Agency, the Historic Tax Credits, and Prudential.
The Hahne’s Building Conversion is being developed by L+M Development Partners, Inc., which has developed quality affordable, mixed-income and market rate housing that improves the neighborhoods to which they belong since 1984.
For more information on HMFA programs, including the Multifamily Conduit Bond Program, please visit www.njhousing.gov.