The Real Deal New York

Newark development agency plots corporate relocation plan

May 04, 2011 10:53AM
By David Jones

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Following the groundbreaking deal last month to develop Panasonic’s $190 million
headquarters
in Newark, the Brick City Development
Corporation will roll out a program starting this summer to lure new corporations to six
specific sites in the city’s downtown area.

Brick City Development Corporation, the city of Newark’s economic development
corporation, is currently in talks with local investors to pitch the six shovel-ready sites to
companies looking to develop new corporate offices. The city is hoping to take advantage
of below market rents and a new spurt of development that will lure potential employers
away from New York or other parts of New Jersey.

“We have over the last month or so talked to a variety of landowners,” said Lyneir
Richardson, CEO at BCDC. “Each of them [has] a site suitable for a new office tower in
Newark.”

Richardson said that the agency sees a huge potential market for corporate relocations,
as Newark has rents of $40 a month in the downtown area, which is 60 percent less than
comparable rents in New York City.

While Richardson would not comment on specific locations, real estate executives in
New Jersey said there are available sites across from Gateway Center in downtown
Newark, near the city’s Broad Street train station on the NJ Transit route to Montclair.

The city and state are pushing to open new corporate sites near major transportation hubs,
not only because of the high price of gasoline, but because the state has major economic
incentives available for companies to relocate.

“Companies have sat for the last three years without making any moves at all,” said Joe
Romano, a principal at Accordia Realty Ventures, in Fairfield, N.J. “These companies
that have sat dormant have got to do things to get their space in line with their current
business objectives.”

London-based Standard Chartered relocated its American Express Bank unit from New York to Newark a few years ago and earlier this year decided to expand its existing offices in Newark.

“The bank’s decision to open and expand a service facility in Newark was based largely
on the city’s commercial real estate and quality,” said Julie Gibson, a spokesperson for
Standard Chartered Bank.

In 2008, the bank relocated its New York offices to a $12 million, 45,000-square-foot
space at 2 Gateway Center in downtown Newark, with 250 employees. Earlier this year,
the company expanded that site by 12,000 square feet.

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