Vol. LXI, No. 31
Wednesday, August 1, 2007
Borough Hall and the developer of the Borough's stalled downtown development project are looking to make some headway through a new level of negotiations geared to resolve a series of conflicts that has delayed a project intended to produce a major in-town address.
On Tuesday, members of Princeton Borough Council, municipal staff, and the principals of the developer, Nassau HKT Urban Renewal Associates, were scheduled to meet in closed session to revisit three major sticking points that have kept bulldozers at bay on a Tulane Street surface parking lot, where a five-story, 53-unit residential and commercial building is slated to be built. That project initially received approval from the Regional Planning Board of Princeton in May 2004.
The meeting is a follow-up to a public presentation made by Borough staff in late June outlining the status of various conflicts between the town and developer. This latest meeting, according to sources familiar with the negotiations, is being conducted in the hopes that any differences can be resolved and that the development, known as Building C, will someday be part of the Borough streetscape.
As it stands, the meeting represents what has been described as a "last, best offer" scenario where the municipality and developer can come to terms on a project that has seen its share of setbacks.
The most pressing of those setbacks involves the issue of the developer's personal guaranty for the Building C project. NHKT principals have offered a personal guaranty, per the developer's agreement with the municipality, instead of what is estimated to be a $150,000 performance bond for the project. Second, there is ambiguity in terms of when NHKT was to start paying rent on the Tulane Street lot. Some members of Council have indicated that the start date was April 2006 at about $15,000 per month, but NHKT has disputed that assumption, and has yet to determine a commencement date for rent payment. The developer currently pays approximately $7,200 per month on its Witherspoon House, the 24-unit residential-commercial structure facing Hinds Plaza next to the Princeton Public Library.
Borough staff had reportedly been near an agreement with the developer regarding a rent commencement date in late June, but negotiations came to a halt when the two parties could not close on a deal.
Finally, there are questions over who should foot the bill for the legal fees involved when several sub-contractors in the Witherspoon House project filed liens against the former general contractor, Troast. While those liens have since been resolved, the Borough estimates that the developer should finance roughly $30,000 in legal fees.
NHKT principal Jack Morrison did not return an e-mail seeking comment for this report.
Borough staff has expressed frustration with the process, saying that the various setbacks have affected other interests as well. Borough administrator Robert Bruschi said the Borough is looking for all details to be ironed out before ground is broken. "We don't want to give up a functioning parking lot," he said. The Spring Street Municipal Garage was designed to offset the loss of the total 249 parking spaces making up the Tulane Street lot, and the former Park & Shop lot where the garage, Witherspoon House, and Hinds Plaza are now located.
Mr. Bruschi said the Borough is being careful to avoid having an "unfinished symphony" in the middle of downtown, pointing to the Sheehan Building on Markham Road that went unfinished for years in the 1980s.
Councilman David Goldfarb said members of Borough Council would likely be in a position Tuesday to listen to the options on the table, and subsequently make a recommendation to revive the project. "We have a wide range of views and experience and we want to bring everyone on Council to the same level of knowledge," he said Tuesday, adding that a goal would be to establish a framework for getting Building C off the ground.
He did say that while Council could entertain the notion of holding the developer in default of its original agreement with the Borough, "we'd find ourselves in court.
"And I would not suggest going in that direction." Mr. Goldfarb added, however, that he saw "no indication" that NHKT was disinterested in advancing the project.
Councilman Roger Martindell, who has publicly considered the notion of consulting with new developers, said the developer should pay what he estimates is roughly $200,000 in ground rent for Building C, and could be responsible for any legal fees involved in with liens against Troast, and said he would rather see a performance bond for the construction, rather than a personal guaranty. "The Borough is at risk because we don't know if the developer is in good financial standing."
However, others involved in the process have not questioned the financial standing of NHKT's principals, Mr. Morrison, along with a silent partner, Barry Ridings, who is also a Borough resident.
NHKT has until August 17 to file building permits with the state and municipality in order to keep the review process based on the current mandates outlined by the state's Prevailing Wage Act, which ensures fair wages, a level equivalent to union wages, to workers employed in government contracts. If permits are filed for after that date, new regulations kick in, and will, some Borough officials worry, result in another setback.
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