By Laura D.C. Kolnoski
OCEANPORT – A section of Fort Monmouth currently undergoing redevelopment, where the new Birdsmouth Beer brewery will soon open, has qualified as an Area in Need of Redevelopment. The designation means the owners, Denholtz Properties of Red Bank, can apply for Payment in Lieu of Taxes (PILOT) status from the borough.
Voting members of the Fort Monmouth Economic Revitalization Authority (FMERA), including Oceanport Mayor Jay Coffey, unanimously approved the designation during their Aug. 17 monthly meeting, following previous approvals by Oceanport officials. The application was determined to be in accordance with the state and local redevelopment and housing law, and Fort Monmouth land use rules.
In December, the borough authorized its planning board to conduct a study of the area known as District A, now renamed Baseline, which includes warehouses, the former Post Office, PX, adjacent parking area, and the fort’s former Commissary, the recently completed first phase of the redevelopment project. A public hearing was held and the planning board determined the site met the statutory criteria for the designation.
In July, following the study by certified planning consultants Phillips Preiss Grygiel Leheny Hughes LLC, the borough approved the designation as a “non-condemnation area in need of redevelopment” via resolution, subject to the consent of the FMERA board by a seven-vote majority.
“The developer has been proactive in continuing with their approvals while waiting for an Area in Need of Redevelopment designation,” said Kara Kopach FMERA executive director. “Achieving this designation opens up the potential for the developer to negotiate a PILOT with the borough.”
FMERA documents cite the New Jersey Local Redevelopment and Housing Law (LRHL) which “offers municipalities tools to encourage redevelopment in areas that meet the criteria of an area in need of redevelopment.” Among the considerations were the extent of the area, justification for the designation, and whether the designation will contribute to the successful redevelopment of the former U.S. Army base.
As per the consultant’s report, “Facilities within Fort Monmouth generally, and those within Oceanport specifically, were built on an ‘as needed’ basis in a somewhat haphazard arrangement to meet the discrete needs of a specialized user, the U.S. Army.”
“The resulting layout… presents obstacles for the successful redevelopment and piecemeal retainment of these structures which could, in some instances, hamper redevelopment efforts. Clearly, in its present condition the Study Area has failed to satisfy the land use policy objectives advanced by FMERA and Oceanport alike,” the report states.
District A spans 26-acres. Denholtz purchased it from FMERA in 2020 for $4.35 million and began a multiphase redevelopment of the site. Phase One included the adaptive reuse of the Commissary, now called The Commissary at Baseline, into a multipurpose destination focused on food and beverage uses. Phase Two plans include construction of 72,400 square feet of industrial/flex space spread across three buildings, scheduled for completion in 2023.
Under PILOT programs, municipalities are authorized to grant developers exemptions from traditional property taxes for a set time period to encourage commercial, residential and industrial development and improvements, or to locate a project in a distressed area. Instead of property taxes, property owners make an annual PILOT payment to the municipality.
The other two municipalities with property inside Fort Monmouth’s borders are Eatontown and Tinton Falls, both of which designated all their fort parcels Areas in Need of Redevelopment early on. Oceanport, officials said, instead grants the designation on a case-by-case basis.
In July, Denholtz Properties announced a lease agreement for a 12,080-square-foot space within the 53,000-square-foot Commissary with Birdsmouth Beer, co-founded by Andrew Gioia, the former head brewer of Kane Brewing Company. The brewery will include a full production facility and a tasting room.
“We are excited to receive the Area in Need of Redevelopment designation from FMERA as it will allow us to continue to execute our vision to once again make Fort Monmouth an invaluable contributor to the regional economy,” said Denholtz Properties CEO Steven Denholtz. Regarding applying for the PILOT, Denholtz said, “We are currently exploring our options and will continue to work closely with Oceanport and FMERA to identify opportunities to drive economic growth at Fort Monmouth.”
“Since our first lease with Birdsmouth Beer earlier this year, we have received significant interest from several additional unique businesses and are anticipating the space will be fully leased by the end of this year,” said Kristine B. Hurlbut, Denholtz’s senior vice president for leasing.
The article originally appeared in the August 25 – 31, 2022 print edition of The Two River Times.
