The Real Deal New York

City of Newark to pay $27M lease on parking lot it sold for $1

Some local lawmakers are questioning whether deal makes sense
March 10, 2019 10:00AM

(Credit: iStock)

Newark’s city council voted Wednesday on a deal to pay $27 million over 30 years to lease a parking lot that it previously sold to the Newark Parking Authority for a single dollar. And not everyone is happy about it.

The land, at 43-67 Green Street, currently contains 258 parking spaces. The city sold the site to Newark Parking Authority, an autonomous agency with plans to develop administrative offices, ground-floor retail space and a five-story parking structure, less than two years ago.

By leasing back the land, the city will have access to the existing parking spots and will have additional space for its municipal court and finance department. They will pay around $27 per square foot, with a 5 percent increase every three years.

“I don’t know why we’re doing it,” Council member-at-large Carlos Gonzalez said in a meeting earlier this year, according to NJ.com. “This was land that we transferred to the parking authority for a dollar and now we are paying the parking authority at $27-a-square-foot a year to rent the building that we could have constructed ourselves and maybe rented space to them.”

But the parking authority pushed back, saying they were doing the city a favor.

“We’re actually subsidizing the city as we’re constructing this,” Anthony Mack, executive director of the parking authority, told the council on Wednesday, “This is not the parking authority pushing this on the city.” [NJ.com] – Decca Muldowney