The Real Deal New York

Kushner Companies’ One Journal Square loses WeWork, 30-year tax break

Jersey City project is facing some big headwinds
May 09, 2017 10:10AM

From left: Jared Kushner, One Journal Square and
Adam Neumann (Credit: Getty Images)

UPDATED, May 9, 7:17 p.m.: It turns out Kushner Companies’ proposed Jersey City development is facing more problems than just questionable promotional materials.

WeWork quietly backed out as the anchor tenant of One Journal Square, where it planned to open a 101,000-square-foot co-working space, Bloomberg reported. The company also considered converting part of the two-tower development to co-living space, but is instead planning to sell its stake. Kushner and its partner, KABR, were expected to each own one-fourth of the $400 million project, while WeWork would own the balance. That ownership structure, however, depended on the project receiving a hefty tax break from Jersey City, which is also in jeopardy.

The Jersey Journal reported on Monday that Jersey City Mayor Steve Fulop did not support the developer’s application for a 30-year tax abatement nor its request for $30.4 million in city bonds.

“I have made my feelings clear here on this project and what I feel works best for Jersey City. This tax abatement application doesn’t work for us,” the mayor wrote on Facebook.

The news of the tax break followed reports that Jared Kushner’s sister, Nicole Meyer, mentioned her brother’s history with the company while raising EB-5 funds in Beijing on Saturday — a big no-no in terms of potential conflicts of interest. In promotional materials, Meyer is also introduced as Jared’s sister, rather than a principal of the company. The family has apologized for invoking Jared. According to Bloomberg, the version Meyer pitched to Chinese investors was bigger and twice as expensive, with costs pegged at $1 billion. [Bloomberg] — Kathryn Brenzel