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Real Estate Development Projects Receive Tax Exemptions

6-11-14

By Michael Hill
Correspondent

In Jersey City – sits the 94-year-old 1 Exchange Place – a closed building that’s open to major development.

Mayor Steven Fulop wants to give a company a 20-year break on taxes to convert this building to a $40 million, 253 room hotel.

It appears the mayor’s plan has plenty of support.
 
“Fiscally it really works for Jersey City. If you compare what the conventional taxes are or the same property over the 20 year life of the abatement, the city will realize an additional $15 million in total revenue. Meaning we also get because it’s a commercial hotel property, an additional $800,000 per year in hotel taxes that we collect. It’s definitely a win win for Jersey City in such a big way,” said Council President Rolando Lovarro.
 
The development would also mean construction jobs and, once converted, hotel jobs.
 
Who ever said the most important thing in real estate is location, location, location must have had one exchange place in mind. Light rail, buses, PATH and it’s on the Hudson right across from lower Manhattan.

But one council member says not so fast. 

“Maybe one or two other people on the council gonna vote against it. I think they feel the same way I do, 20 years is too long for an organization that’s going to make it profit when they open up and it will be, the hotel will be packed,” said Rich Boggiano.
 
“Those who are running the restaurants, pubs where’s there tax break when is their time going to come to get a little help from Jersey City?” said Darren Iwicki.
 
And the Americans for Prosperity also took aim at the state Economic Development Authority’s $82 million tax break to the Philadelphia 76ers to build a practice facility and headquarters along the Camden waterfront.
 
“If We’re going to cut taxes cut and grow our economy it needs to be for everybody, lessen the burden across the board,” said Iwicki.
 
It’s rare to have the AFP agree with the a liberal leaning NJ Policy Perspective. But even the NJPP calls the 76ers deal way too generous.