Commercial Retail Center in Linwood Gets First Financing Through EDA’s New Smart Growth Predevelopment Loan Fund
Linwood, N.J. (December 30, 2003) – A combined commercial and retail project in this Atlantic County community has received the first financing under the New Jersey Economic Development Authority’s (EDA’s) Smart Growth Predevelopment Loan Fund, established to encourage redevelopment in the state’s urban and developed suburban and rural communities.
The EDA made the Smart Growth loan of $1 million to Cornerstone Commerce Center, LP for two years at an initial interest rate of 3%. Cornerstone estimates the project will generate almost 800 jobs within two years among businesses that will locate in its redevelopment project.
Cornerstone Commerce Center was established last year to acquire, develop and lease property located at 1201 New Road here. The Karman Development Group, LLC, a related entity, will undertake the $21.7 million project, which will involve the redevelopment and renovation of a 250,000-square-foot building that has been demolished down to its outer shell. The goal is to create 140,000 square feet of Class A office space, 80,000 square feet of upscale retail space, and a fine dining restaurant.
“In support of Gov. James E. McGreevey’s smart growth initiatives to redirect the state’s development and conserve open space, the EDA established two new lending programs to provide developers, businesses and municipalities with the financial tools to spur revitalization of older development sites,” said EDA Chairman Al Koeppe.
Thus far, the EDA has committed nearly $3.3 million in financing assistance to these redevelopment efforts.
EDA Chief Executive Officer Caren S. Franzini explained that the Smart Growth loan program provides loans and guarantees up to $1 million for up to three years to developers for noncontaminated site preparation costs such as land assemblage, demolition, removal of materials and debris, and engineering costs. A second initiative, the Brownfields Redevelopment Loan Program, enables developers who have a signed Brownfield Reimbursement Agreement with the Commerce & Economic Growth Commission to borrow up to $750,000 for upfront, interim remediation funding for cleaning up contaminated sites.
Smart Growth Predevelopment loans can be obtained by developers for commercial, industrial, office or mixed-use projects in urban and developed suburban and rural communities provided each project has municipal support and is part of the local redevelopment plan.
Karman Development Managing Partner Robin Karman said, “A key benefit of the loan we received is that it is predevelopment financing that takes care of a lot of upfront research and fact-finding to move the project from vision to reality. And the low interest EDA terms are very favorable. I don’t think you can get more favorable financing.”
Karman said the company had a very good experience with the EDA. “The agency was very responsive and obviously anxious to invest in a project that will create jobs,” she said.
In addition to permanent jobs, the development is projected to generate 255 construction jobs, Karman noted. The development stage will also create and sustain employment in such fields as architecture, public relations and advertising, she said.
The EDA was established in 1974 to promote economic growth and create jobs. It has arranged more than $16 billion in financing since its inception. For more information about the Smart Growth Predevelopment Funding Program or the Brownfield Redevelopment Loan Program, contact the EDA’s Brownfields Redevelopment Office at (609) 341-2723 or by e-mail at brownfields@njeda.com. Internet users can also learn more about EDA brownfield programs by visiting www.njeda.gov.
