Foreclosure for Carriage City Plaza

Foreclosure proceedings will begin on Carriage City Plaza, a 16-story hotel and condo project that was the centerpiece of redevelopment efforts the past decade. Of the 222 units at Sky View at Carriage City Plaza, 62 units have closed and another 72 leased, leaving 88 units.

The foreclosure process is expected to take 10 to 15 months, according to Redevelopment Agency attorney Frank Regan, who informed commissioners at their meeting last week that Carriage City Properties (CCP) consented to foreclosure.

The Redevelopment Agency approved a new settlement agreement with CCP and its lender, Amalgamated Bank, at its Sept. 22 meeting after a discussion in closed session. Regan said the agreement was executed about three weeks ago. A settlement agreement approved by the agency in May 2009 was never executed, though some of the terms have been carried over to the recent settlement, he said.

The bank likely to be only bidder on the loan considering about $50 million remains on the $65-million construction loan, Regan said, and will look to carry out the sale of units with Carriage City continuing to run the site until the sale. Except those units already owned by individuals, the entire building will go into foreclosure, he said, including the hotel and retail space, which make up the first three floors of the site.

The agency has received about $400,000 overall to date, and will receive another $1 million, Regan said. Under the terms of the original redevelopment agreement, the agency was to have received about $10,000 per unit at the time of closing (which would have been about $2.2 million — $10k x 222 units).

Amalgamated Bank paid a portion of water connection fees owed by CCP, about $72,000, at the end of last year. Carriage City also paid $150,000 in spring 2009 as a contribution toward the $1-million East Milton Avenue-Irving Street intersection improvement project, of which Carriage City originally was to be responsible for $368,562.

Upon execution of the agreement, Regan said the agency provided Carriage City and Amalgamated with a certification of completion, evidence that the project has been completed, and a temporary certificate of occupancy for the entire building. As part of the agreement, Carriage City withdrew an appeal of a building code violation.A final certificate of occupancy is expected any day, at which point $1 million will be transferred to the Redevelopment Agency, Regan said. The project is completed, and while vacant, it does pay property taxes, he said, upward of $1 million. Environmental issues relating to groundwater monitoring is still required to by the agency until receipt of no further action letters from the state.

20 thoughts on “Foreclosure for Carriage City Plaza”

  1. Thanks for the report Mark. Local print media is asleep when it comes to Rahway.Amazing how this was kept quiet during the election.The new mayor should be asked what his plan is about trying to salvage our tax dollars in this project.Yes, there were over a million plus in tax dollars/ loans used to buy up the properties to build this project. The State also used tax dollars to clean up the site, the developer didn't pay for that either.What about the new traffic light out front? Silcon hasn't paid for that either.The City also re configured the train station plaza at 400k for this developer.Talk about going above and beyond for someone. The redevelopment Agency signed off on all of these special items. We even changed the downtown into a 2 way!!!What is the total amount of money the tax payers of Rahway are on the hook for?That doesn't count what they pay in property taxes. The city would tax that property no matter who owned it.Collecting the investment made by the taxpayer over 10 years ago is what should be the first order of business and the new Mayor should explain how he will get this money.THE Rahway RED. Agency was not elected and should not be the lead spokesman in this mess.They played a large role in creating this mess.

  2. Do the MATH. Before when it was a dilapidated gas station the entire block paid what? 40k maybe? i'm sure Mark would know. Is the downtown better with this building or the vacant gas station? In case you missed it the country is in a recession, and transactions of this nature are just business. And whats the down side? Silcon will be gone, thats a good thing. A reputable bank will take over the property which should have considerably better resources to fill the retail.

  3. Long time no post.>>A reputable bank will take over the property which should have>>considerably better resources to fill the retail.Except that banks are notoriously the worst landlords. Banks are set up to take deposits and lend money, not manage REO. Then again, Silcon is the bottom of the barrel when it comes to property management so its hard to argue that a bank, or any person with a pulse, would be "considerably better" at filling the retail.Regardless, its going to be ugly when the remaining units go up for auction and sell for pennies on the dollar compared to the price those who bought in 2008 paid.Already there is a comp for a B-unit on the 10th floor. 1002 sold in 12/08 for 395k. 1009 sold about one year later in 11/09 for 340k. Not sure if the view of the trains pulling in vs a view of the Linden Oil Refinery commands the higher price. More likely, the market value dropped 14% over the year and has likely dropped another 14% since last year.Great reporting Mark.

  4. As the first responder wrote, isn't amazing how this was kept quite long enough for the elections to proceed?? A white elephant it has truely become… seems an anonymous post not too long ago suggested just such a scenario.If we are kept in the dark and on the hook by the previous democrats, most of whom are still on the council, why should we think the same won't be true for all of the new "arts" projects that are planned?

  5. I know there's a recession, and I know in the long run this was still a good investment for the town.But it hurts to see us taxpayers stuck with some of these bills while, somewhere, Carlos Silva continues to drive his lamborghini and pretend like he can't afford to pay what he owes.Just shows how business constantly and consistently outsmarts government.

  6. Anonymous at 1:15pm.I did do my homework and the business of what people buy and sell homes for is public information as are the taxes paid on those dwellings.Anyone with the ability to go to Town Hall to review deeds and mortgage records or the ability to search for these records online at the NJ Association of County Tax Boards can verify my information.Both the units I mentioned are "B" units, they both pay $5,738 per year in RE Taxes because they occupy the same square footage and are both configured as 2BR/2Bath apartments.It is absurd to think that a home in Rahway would fetch the same market price in 2009 as it would in 2008. RE values have gone down everywhere and towns like Rahway are not immune to the downturn.

  7. 1002 – Bldg Desc=Condo-B-1Whttp://tax1.co.monmouth.nj.us/cgi-bin/m4.cgi?&district=2013&block=316&lot=3.02&qual=C10021009 – Bldg Desc=Condo-B-1Ehttp://tax1.co.monmouth.nj.us/cgi-bin/m4.cgi?&district=2013&block=316&lot=3.02&qual=C1009The "B" in the Bldg Desc notes the unit style. Both are B. Both pay the same taxes so frankly, I don't care if 1002 is a 5 bedroom and 1009 is a studio. One person paid a lot less for something the city is going to tax as having the same appraised value.If you have evidence to refute my claim, please do so.

  8. Nope units definitely decreased in value as did almost all real estate in that time frame in NJ, however, what is not shown is whether or not one unit had upgrades included in the purchase price and if the other did not.

  9. For the record, I don't feel good saying "I told you so", although I'm glad I resisted the siren song of the Silicon sales staff (throw in a strategically placed "enhanced" and this comment is now NSFW!). Blame the recession or whoever you want, the bottom line is that when easy money pours in to situations like this it never ends well. Rahway 2020 looks more realistic. Maybe hitting rock bottom isn't so bad since places like Detroit are becoming areas where artists, artisans, and other creative movers and shakers can cluster together and rebuild.I took the train to NYC last Friday for the first time in ages, and I didn't see much change when my train went through Rahway. I thought the abandoned factory opposite Skyview would have been demo'd by now along with other eyesores.

  10. Business as usual. It was CCP selling and now it will be the bank. Hotel is bustling and will continue to operate. The only people getting screwed are the taxpayers for not getting all the money promised but like it was mentioned, the city has $1 million more in tax revenues than it had before.

  11. I stayed there for two weeks when my house was being renovated and able to be lived in yet (no working kitchen or bathrooms).We saw a lot of pilots coming and going. There were several groups that appeared to be wedding parties. It was a very nice stay – the hotel is really well run and comfortable. I wouldn't hesitate to recommend it to anyone having out of town guests who didn't have room to put them up.

  12. As long as there are Democrats running Rahway there will never be anything setup in an economically sound manner. Some rebirth Rahway is having. We have the UPAC that was just redone a few years ago so we could attract bigger stars. Where are they? Time for a new booking agent or what..New Hope We ARE NOT.

  13. Joan Rivers was there last week. That's not bad. Especially since the age group should attracts has money to spend around town. The town certainly seemed to be very busy that night too with lots of cars and people. Hopefully they can continue to bring stars that will draw crowds, even if it's not everyone's cup of tea.

  14. For the record, I've heard that the Hotel Indigo enjoys very good occupancy rates throughout the week. I recall hearing previously (not sure how long ago) that they had arrangements with a few airlines to have their employees use it.

  15. This just shows what a little money and greedy politicians do to the tax payers and you people keep these council people in, The mayor and Carlos Silva are laughing at you when they are counting their money they made, The head of the Redevelopment Agency helped silcon with this fiasco and he still has his job and all the sheep just take it. You people just talk, you don't hold him accountable and life goes on in town hall and will keep going on….

Comments are closed.