Builder Sues For High-Density Rentals at Holy Family School Site

May 1, 2017
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The former Holy Family School on Route 36 East in Hazlet. Photo by Nikole J. Ghirardi

By John Burton |

HAZLET – A “builder’s remedy” lawsuit involving the former Holy Family School property and the township’s requirements for affordable housing continues to drag on in the courts.

First filed in November 2015, Highview Homes, LLC, 280 Highway 35, in Middletown, a developer of luxury for-sale and for-rent single-family homes and multi-family units, has named the Hazlet Township Committee and the Planning Board as plaintiffs in a suit alleging the township has failed to make an effort to fulfill its most recent affordable housing obligation under the state’s Council on Affordable Housing (COAH) guidelines.

In response to the municipality’s alleged failure to address the issue, Highview Homes is seeking to construct a high-density, luxury rental project on the former Roman Catholic school property, 910 Highway 36.

Real estate residential developers bring what is referred to as a builder’s remedy suit when a municipality has failed to obtain state certification for its affordable housing requirement. The developer then asks the court for permission to construct a project that often exceeds density or other zoning constraints in exchange for designating a number of the units as “affordable.”

In the last dozen years, Two River area communities such as Rumson and Oceanport have faced such suits, with varying outcomes.

The proposed development is not permitted under the township’s current zoning for that site. That property is zoned for single family homes in the portion of the school property that backs up to a residential area, and for commercial development on the section of the property that faces the state highway.

According to court filings, Highview Homes has a contract to purchase the approximately 17-acre parcel from the Diocese of Trenton. The location still has its 51,000-square-foot pre-K-8 building. The school first opened in 1967 and shuttered on June 30, 2009.

According to the complaint, Highview Homes charges that Hazlet has a current obligation for providing “no less” than 713 low-and moderate-income housing units based upon the third round of Mount Laurel requirements under COAH, which it has yet to attempt to meet. According to Highview’s complaint filed in state Superior Court in Freehold, that housing number was based upon calculations done by the Fair Share Housing Center for the third round of state-mandated obligations, going from 1999-to-2025. The center is a public interest advocacy organization whose mission is to enforce the state’s Mount Laurel Doctrine to provide affordable housing opportunities.

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The township’s response to the complaint denies many of the allegations Highview raises, that Hazlet “has failed to adopt a Fair Share Housing Plan or other wise comply with its constitutional obligation under the Mount Laurel Doctrine to create a realistic housing opportunity,” to address the state-mandated requirement.

Highview said “the Township has not indicated a willingness to revise its zoning to allow” for the developer’s project. And given Hazlet has not presented a plan to address its affordable housing obligation, Highview “will set aside a substantial amount of units within that development for occupancy by low income and moderate income households…” The complaint did not specify the number of units.

According to Hazlet’s response to the complaint, “…the township’s zoning ordinance provides a realistic opportunity for the construction of its fair share of affordable housing.”

The township maintained Highview Homes had initially proposed 150 luxury rental units for the site, when the developer first broached the subject in May 2015. The number of units increased by July 2015, to 180 rental units, according to the township’s response drafted by its attorney, James Gorman.

One source indicated Highview has upped the number again, seeking to construct more than 200 units on the former school property.

Gorman charged that “Highview Homes did not propose any affordable units in its luxury rental apartment plan,” and any rental project has to designate at least 15 percent of the units as affordable. In August 2015, the developer would consider only 10 percent, which the township considered insufficient, according to Gorman’s brief to the court.

Gorman also alleged the developer had “failed to act in good faith,” in negotiating with the township before filing its suit.

Mayor Susan Kiley was reticent about speaking on a matter currently in the courts when contacted for a comment. “We want development in Hazlet,” Kiley said. “But we want the right kind of development.

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“We don’t want over development,” she concluded.

Gorman declined to comment on ongoing litigation.

Richard Hoff Jr., a Haddon-field lawyer representing Highview Homes, did not respond to phone calls seeking comment.

Highview Homes is seeking to have the township “take all necessary, reasonable steps,”  to allow the project to move forward and award the plaintiff attorneys’ fees, cost of litigation, court costs and pre-and post-judgment interest.

Among its projects, Highview Homes is in the process of constructing a 232-unit apartment unit, residential and commercial project in Aberdeen and had built Clubway at Little Silver, a 15-unit for sale townhouse development.

The suit is before Superior Court Judge Jamie S. Perri in Freehold. No trial date has been set.

Another developer, Elegant Properties, had brought and won a similar suit in the state Appellate Division on Sept. 9, 2010 but the 48-unit condominium project at Poole Avenue and Route 36 never moved forward.

The Council of Affordable Housing was established following the state Supreme Court ruling commonly called the Mount Laurel decision. In that case, the state’s highest court determined each municipality had an obligation to “provide its fair share” for opportunities for affordable  housing. COAH had established a complicated formula laying out what each municipality should provide – vexing many towns which felt it was unduly burdensome.

While providing a housing plan was technically voluntary, having COAH certify a town’s plan offered legal protection from builder’s remedy suits, leaving communities without a plan vulnerable to that action.

Under the Christie administration COAH has been rendered moot; but a 2015 state Supreme Court decision now has Superior Court judges able to provide that temporary immunity from the suits while considering the towns’ housing plans.

Builder’s remedy suits “really play an important role,” in bringing towns to the table “and pull them into the process,” said Anthony Campisi, a spokesman for the Fair Share Housing Center.

And by doing that it “allows New Jersey families to get the relief they need,” by actually seeing affordable homes being built, Campisi said.


This article was first published in the April 27-May 4, 2017 print edition of The Two River Times.

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