By Laura D.C. Kolnoski
The Fort Monmouth Economic Revitalization Authority (FMERA) held its fourth consecutive meeting via teleconference June 17, continuing to adapt to myriad effects of COVID-19.
NEW DEAL FOR COMMISSARY, KEY ADJACENT PARCELS
Developer Oceanport Partners, an entity of Denholtz Management Corp. based in Red Bank, is in the process of purchasing a substantial swath of Fort Monmouth within Oceanport that includes the former 53,700-square-foot Commissary and Post Exchange (PX) Complex, Warehouse District, Post Office, and a 6-acre parking area. Oceanport Partners was the only bidder that submitted bids for all four properties, officials said.
Fort Monmouth’s former Commissary complex, once a hub of activity for thousands of military personnel and area veterans, is on track to be redeveloped into a multiuse food, arts, office, education and entertainment-focused campus.
According to FMERA documents, the firm proposed the “highest and best use” was to merge the sites into one cohesive parcel. Plans are to include Class A office space to support general and food-related research, and space for product storage and distribution. Built in 1998, the Commissary “shall serve as an enrichment center incorporating a provision for food services, a culinary school, crafts production, arts adaptation (including music and art facilities for all ages) as well as the display of art.”
The complex may also include retail, office and entertainment.
“This merger simplifies land use planning and compliance,” wrote FMERA staff in their recommendation to proceed with the plan. To facilitate the merger, a streamlined schedule will be instituted for routine periods including due diligence, approvals, amendments and closing. Additionally, FMERA negotiated a $600,000 price reduction with Oceanport Partners in exchange for an expedited closing by Sept. 30, allowing FMERA to continue to meet its financial obligations for the year.
“We are giving them back 10 percent of their deposit and incentivized them to close by Sept. 30,” said Robert Lucky, FMERA interim chairman. “We’ve had problems getting things closed, so FMERA’s Real Estate Committee agreed this is the right thing to do.” If Oceanport Partners does not close on the property by that date, the firm must pay the original purchase price of $4.95 million.
The 10 percent of deposit return is among new rules adopted by FMERA in response to hardships experienced by fort developers resulting from COVID-19. Developers must demonstrate the money will be used to finance activities including legal, engineering, consulting and other costs, other business operations at the developer’s main business or businesses such as payroll, utilities, rental or mortgage payments, and similar operating expenses, or to replace income from leases or mortgages deferred or vacated by the developer’s tenants.
“Steve Denholtz is very creative and has a great pulse on the marketplace,” said Bruce Steadman, FMERA executive director, of Denholtz Management Corp.’s CEO. “He’s an Oceanport resident and wants to do something nice in his hometown. The buildings are big and unique enough for multiple tenants and able to house more than one tenant. He will create a beautiful campus with amenities for workers there.”
THEATER BIDDER WITHDRAWS
The lead bidder has withdrawn a proposal to purchase and redevelop Fort Monmouth’s former Expo Theater, located on the Avenue of Memories (Route 537) in the Eatontown section of the former U.S. Army base. The 1968-era building on 7.8 acres that includes the adjacent Dean Field has 995 seats for live theater and cinema. Four proposals were originally received for the site, which is intended for continued use as a community theater.
“We are now in negotiations with the second highest bidder,” Lucky said. As per FMERA rules, the names of bidders are not disclosed until a tentative deal is achieved. “Nothing is ever finalized until closing,” noted Steadman. During the standard due diligence period in which the highest bidders thoroughly investigate properties prior to moving forward on a purchase agreement, the theater’s potential buyer, “came across issues that impacted the anticipated return on their investment,” Steadman explained, adding there were also possible impacts of COVID-19. He said the second highest bidder has “very similar plans” for recreation, arts, entertainment and public activities. “If negotiations go well, staff will make a recommendation to FMERA’s Real Estate Committee in July,” he said.
DANCE HALL LIQUOR LICENSE ADVANCES
By unanimous vote, FMERA members approved an application for one of a dozen special liquor licenses granted to fort properties by the state last year to The Loft, a new microbrewery and event space being created at the fort’s former Dance Hall by The Loft Partnership, headed by developer Fuller “Trip” Brooks. Following extensive renovation and expansion work over some two years, the 1940s structure is nearing completion.
The state granted the licenses to attract new businesses, generate jobs and support the fort’s overall revitalization within its 1,126 acres that span portions of Eatontown, Oceanport and Tinton Falls. The issuance of licenses is a cooperative effort by FMERA and the municipalities. Each town can establish its own award criteria and sale prices in accordance with the state statute. The Loft application must now go to the Oceanport governing body for final approval.
“When COVID-19 hit I was afraid we would lose projects,” Steadman said after the meeting. “It’s been great to see it hasn’t done that in terms of offices and housing. People will be interested in leaving urban regions for suburban projects like ours. Developers are staying in the game, managing risk and moving forward. Our team and stakeholders have hardly lost a beat.”
The article originally appeared in the June 25 – July 1, 2020 print edition of The Two River Times.
