A Northfield-based developer has given new urgency to the NextGen Aviation Research and Technology Park, a project suffering from mismanagement, delays and inflated expectations.
The NextGen park’s board more than six months ago selected New Vistas Corp. as the project’s “conditional designated developer,” a description that reflected that terms of the arrangement were not yet final.
That is still the case: Both parties have until late August to negotiate a developer’s agreement and lock in the terms of the arrangement. Officials say that agreement could mark a new beginning for the project, since it will address everything from the project’s budget to a formalized plan for a tenant search to determining rates for subleasing space at the park.
Headed by Michael Cohan, founding executive director of the Casino Reinvestment Development Authority, New Vistas specializes in complex projects that are difficult to finance. Cohen founded New Vistas in the 1980s after leaving his post at the CRDA. The company has 60 employees, with offices in New Jersey and Pennsylvania. The firm has worked on the Brigantine Beach Club, Tilton Fitness in Galloway Township and Oceanview Condominiums in Margate.
“With everything that’s occurred, I think having New Vistas on board shows that they’re poised to become the leader for this project and make it a success,” said Ed Salmon, the NextGen park board’s president and a former state assemblyman. “It’s the fact that they’re local, they’re experienced and there’s a willingness to work with this situation.”
Perhaps nothing demonstrates the project’s challenges — and the current spirit of cooperation among the parties involved — more than the recent extension of a $9.5 million bid for construction of the first building by Hunter Roberts Construction Group. The lowest of 13 bids submitted more than a year and a half ago in January 2011, Hunter Roberts agreed this month to extend its bid for a fourth time through the end of 2012, said Salmon, who was informed of the decision by Cohan.
Hunter Roberts did not return calls seeking comment. Those involved with the project said the extension negotiated through New Vistas was significant because if the construction of the first building were to be rebid, the costs would almost certainly be higher, as the bids offered in January 2011 went as high as nearly $13 million. The extension guarantees that if the bid is used, construction costs will be locked in at $9.5 million.
While the seven-building project was once said to cost $300 million and promised 2,000 high-paying technical jobs, Cohen said he expected the park could be built for less than that.
Just how much less isn’t clear. That information is not provided in the proposal submitted to the park’s board. Other financial information about the company was redacted from an Open Public Records Act request for copies of the documents submitted to the park’s board before being selected for the project.
New Vistas was selected through a request for qualifications process that began in May 2011. More than 70 companies downloaded information on the process from the South Jersey Transportation Authority website. Two companies responded in June with statements of qualifications.
New Vistas touted in its statement of qualifications the 250 properties it manages across three states, including 1 million square feet of commercial space and 130 retail stores. It also pointed to its ongoing partnership with LandMatters LLC, a minority, veteran-owned, company whose president, J. Edward Whitehead, is a Navy veteran. LandMatters also has some celebrity recognition, as its board includes former boxer Sugar Ray Leonard and former basketball player Julius “Dr. J” Erving.
In September, a subsequent request for proposals was issued to which New Vistas was the only respondent.
First announced in October 2005, the NextGen park was planned on the campus of the Federal Aviation Administration’s William J. Hughes Technical Center in Egg Harbor Township. It was built as a haven for collaboration between the FAA and the private sector as the federal government announced it would release an unprecedented $7 billion to research and implement upgrades to the air-transportation system.
Release of the federal funding has been extremely slow, giving some aviation companies pause in considering leasing space in the park. Also, the South Jersey Economic Development District, which holds the lease for the park’s land with the Federal Aviation Administration, fell into more than $1 million in debt while leading the project. The district has since voted to oust its executive director, Gordon Dahl, who board members said was making decisions about the project without their knowledge.
In addition, bills tallying hundreds of thousands of dollars went unpaid. Dahl, however, received raises without the full knowledge of his board or the proper documentation, a Watchdog Report by The Press of Atlantic City found earlier this year.
NextGen board members remain adamant that while the project still has hurdles to overcome, the cooperation present since Dahl was removed from the SJEDD has had a significant effect.
“We’re making progress, and I’m confident we’ll have a groundbreaking by year’s end,” Salmon said.
New Vistas’ proposal does reveal some specifics as to how the park, which would be developed on a 55-acre campus, would come together. New Vistas suggests lease rates that would start at $21.50 per square foot triple net, meaning that in addition to rent and utilities, tenants would also pay taxes, insurance and maintenance. The SJEDD at one time proposed lease rates of more than $30 per square foot triple net.
Performance metrics included in the project’s proposal showed construction of the first building commencing in April, but that goal has not been met. According to the proposal, once construction begins, the first building could be complete within 13 months, and tenants could move in two months later.
Park Executive Director Ron Esposito said the metrics depicted an ideal schedule that would occur should the parties have been ready to move forward immediately.
Under New Vistas’ plan, the project would move forward based on demand, with one or two buildings under construction at one time. It would take between eight and 10 years for all seven buildings, including 400,000 square feet of space, to be constructed. The performance metrics included in the proposal stretch through October 2024.
However, much remains to be done before the project can break ground. Most significantly, the NextGen park’s board does not yet have control of the lease for the park’s land. Without it, New Vistas cannot begin development.
The SJEDD still holds the land lease and is in negotiations to transfer it to the park’s board. That process, however, has proved grueling as new leadership attempts to sort out the SJEDD’s finances and determine its future. Other grants and loans obtained by the SJEDD to finance the $7 million infrastructure installation on the park’s grounds also need to be closed out.
“It’s going to be a long process, probably several months,” Salmon said. “That’s our one final hurdle. We’re all working together, and we’re very optimistic.”
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