FEATURE ARTICLE, DECEMBER 2008

TUCKER DEVELOPMENT TO INVEST IN NEW JERSEY
Stephanie Mayhew

Since its founding in 1996, Highland Park, Illinois-based Tucker Development Corporation (TDC), a fully integrated real estate company, has become one of the Midwest’s most respected mixed-use and retail development specialists. With a portfolio of high quality properties concentrated in Midwestern states such as Illinois, Michigan and Wisconsin, the development company is now turning its focus to New Jersey.

In January of this year, TDC announced a strategic initiative to invest up to $1.5 billion in New Jersey retail, mixed-use and transit oriented development opportunities. Also at that time, TDC further entrenched itself within the state, opening an office in Newark, the city where it would begin its first project.

“The original interest in coming to New Jersey was the opportunity and the demand that currently exists for transit-oriented developments, mixed-use developments and straight retail,” says Richard H. Tucker, president and CEO of Tucker Development. “Newark is a superb place to begin our efforts because it has as great a pent-up demand as any place in the country, as well as incredibly strong leadership from Mayor Booker and his administration.”

According to Tucker, that demand has sent Newark residents outside of the city for their shopping wares, and potential tenants seeking quality office space within close proximity to New York City have bypassed Newark as well because of the lack of retail and office space. Two trends that the city’s government and Tucker hopes to change.

“Newark is home to about 280,000 people, and growing, as well as approximately 50,000 office workers and another 50,000 to 60,000 people associated with the major universities in the area. However, despite this population, there is a very limited supply of retail or new office space,” explains Tucker. “Statistics put retail leakage, shoppers that actually leave Newark to shop elsewhere, at $500 to $600 million.”

Liberty Plaza is Newark, New Jersey’s, first Class A, mixed-use development in the downtown area in 15 years. Phase I of the project will consist of a 440,000-square-foot 22-story office and retail tower.

One of TDC’s first ventures in Newark is Liberty Plaza, the city’s first Class A, mixed-use development in downtown Newark in 15 years. The $150 million project sits on a 3.5-acre parcel situated in the heart of the Newark transportation hub. Phase I of the project will consist of a 440,000-square-foot 22-story office and retail tower.

Located adjacent to the New Jersey Transit Broad Street rail station, the Liberty Plaza site also offers access to entrance and exits ramps for I-280, with direct vehicular access to and from McCarter Highway/Route 21. The Broad Street Station provides direct access to New York City in under 20 minutes and also services the Morristown, Hoboken and Secaucus Transfer Station. In addition, the site sits across the street from the new Broad Street Light Rail Station, which provides access to the New Jersey Performing Arts Center and Newark’s Pennsylvania Station.

The location of the development also offers an incredible tax value, enabling potential office tenants to qualify for the state’s new Urban Transit Hub Tax Credit, which offers in excess of $100 million in tax credits over 10 years to companies bringing more than 250 employees to this transit hub location. Additionally, the site is located within Newark’s Urban Enterprise Zone, which entitles tenants to a host of additional economic incentives.

Tucker and the city are betting that the Urban Transit Hub Tax Credit will be a big draw for those looking for Class A workspace without the sky-high rents that often accompany new, first-class space in surrounding cities.

“In Manhattan, you are looking at rents that are $80 to $100 per square foot, but in Newark at Liberty Plaza, a tenant that qualifies for the Urban Transit Hub Tax Credit could be here free for the first 10 years,” remarks Tucker. “I think in our current economy, everyone is trying to figure out the best way to minimize costs, and to be creative in reducing corporate overhead. How do they not take a look at something that could effectively put them in a rent-free position for 10 years.”

Designed by architect RMJM Hillier, the project was crafted with superior environmental responsibility and technology in mind, including LEED certification. It will feature state-of-the-art telecommunications systems, high-tech security, and an abundance of diverse power supply sources, including an area for tenant-controlled generators for backup power.

Liberty Plaza will also feature more than 750 on-site parking spaces, contemporary dining atmospheres, a rooftop garden, a fitness center, a banking facility and retail space. The master plan for Liberty Plaza includes in excess of 1 million square feet of office, retail and hotel uses.

Springfield Avenue Marketplace is a 225,000-square-foot shopping center situated on 11 acres on Springfield Avenue, the dominant retail street in Newark, New Jersey.

Another project TDC is working on in Newark is Springfield Avenue Marketplace. Located on 11 acres on Springfield Avenue, the dominant retail street in Newark, the site will feature a 225,000-square-foot shopping center. The center will most likely be anchored by a discount department store and/or grocery store, and in addition, it will feature mid-box tenants ranging from fashion to hard goods, as well as some smaller service-oriented tenants and restaurants.

“None of these types of tenants currently exist in Newark, so between the residents and the daytime office and the university populations, there is minimal competition. Any retailer that does open at Springfield Avenue Marketplace will be tremendously successful because the demand is enormous,” says Tucker.

The center will also feature on-grade and deck parking. Construction is slated to being on the shopping center second quarter 2009.

TDC is currently working on plans for several other future projects in North and Central New Jersey that will range from mixed-use to straight retail. The company also continues to focus its energy on development projects in the Chicago Metropolitan area.

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