Real Estate Project Near NJPAC In Newark Gets Huge Tax Break From NJ

NEWARK, NJ — A construction project that will create an apartment and commercial building near the New Jersey Performing Arts Center (NJPAC) in Newark is now eligible to get a huge tax break from the state, officials announced Tuesday.

The project, known as the “NJPAC District,” has been approved for a tax credit that can potentially reach 60 percent of the total eligible project costs – up to a maximum of $199.69 million, according to the New Jersey Economic Development Authority (NJEDA).

Here’s what to expect when the construction is finished, state officials said:

“It will include a residential component, known as ‘ArtSide,’ which will be comprised of 350 units totaling 384,840 square feet, with an additional 10,500 square feet of office space and 12,600 square feet of retail space. The project will also include a new 53,000-square-foot arts-education and community facility known as the ‘Cooperman Center,’ coupled with the renovation of the 17,000-square-foot Episcopal Church building for related arts education activities. Additionally, the project will consist of improvements to the existing 100,000-square-foot NJPAC facility, as well as significant infrastructure improvements to the larger site needed to accommodate the development, such as the complete overhaul of NJPAC’s front lawn, Chambers Plaza.”

The NJPAC District is being developed by LMXD, an affiliate of L+M Development.

The tax credits were approved under the state’s Aspire Program. Eligibility requirements include showing that the proposed project will “result in a net positive benefit to the state,” and that it wouldn’t be “economically feasible” without the tax break.

The creation of housing – particularly affordable housing – has been a perpetual need in Newark, the state’s most populated city.

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All residential Aspire projects must include 20 percent affordable housing, with the exception of those that are solely renovations and don’t include the creation of new units.

As a “performance-based program,” Aspire projects must certify that all commitments established at time of approval have been met before receiving their first disbursement of tax credits – a major criticism of previous tax programs conducted under the aegis of the NJEDA.

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The NJPAC District is the second “transformative” project approved under the new Aspire rules, which the NJEDA adopted in November.

In addition to the Aspire tax credits, the project is also benefitting from financing provided by the New Jersey Housing and Mortgage Finance Agency’s Low Income Housing Tax Credit program.

“NJPAC has been a magnet for local residents and visitors from all over the region for decades, by offering world-class performances, arts education and community engagement,” NJEDA chief executive officer Tim Sullivan said.

“The project will expand NJPAC’s positive impact on the Newark community by providing a lively destination for visitors and a dynamic place to call ‘home’ for those seeking a transit accessible, arts-centric lifestyle,” Sullivan added.

Sen. Teresa Ruiz, who represents Newark in the state’s 29th Legislative District, said that NJPAC’s mission “speaks to the purpose” of the Aspire program.

“From the dynamic living spaces to the arts-education facility, this project reflects our vision for a vibrant, inclusive future,” Ruiz said. “I am excited to see the positive impact it will bring to our city.”

Assemblywoman Eliana Pintor Marin – who also represents the city in the 29th District – called the NJPAC a “cultural gem.”

“This transformative endeavor will not only bridge the gap between downtown Newark and the stunning Riverfront Park but also ignite a renaissance in the heart of Newark,” Pintor Marin said.

Tuesday’s announcement also got a thumbs-up from Newark Mayor Ras Baraka.

“The sum of these funds – whether to establish dining venues, art studios, space for creative work and communal collaboration, or an agricultural and nutritional center – are each, and collectively, earmarked for the nourishment of all aspects of Newark’s vitality as a thriving community,” the mayor said.

The NJEDA has recently awarded tax credits to three other large housing projects in Newark.

In September 2023, the state agency approved up to $90 million in tax credits for a new, 14-story building at 81-93 Orange Street, which is located across the street from NJ Transit’s Broad Street Station. Read More: NJ Approves $90M Tax Break For Housing Project In Newark

Last June, a 23-story high-rise project in the city’s downtown Central Business District was approved for nearly $50 million in potential tax breaks. The location is within walking distance of Newark Penn Station, the Newark Light Rail, and several bus stops. Read More: High-Rise In Newark With Affordable Units Gets $50M Tax Break From NJ

And last July, the NJEDA announced that a new affordable housing building for seniors – the Terrell Homes project – will get an $8.9 million boost. Read More: Affordable Senior Housing Building In Newark Gets $8.9M Tax Credit

These three combined residential projects have created 626 units of housing in Newark, including 206 affordable units, the NJEDA previously said.

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