Table of Contents Kearny Point Overview Market Research Comparable - - PowerPoint PPT Presentation
K EARNY P OINT : F ROM S HIPYARD TO F ULLY I NTEGRATED C OMMUNITY P HASES 3 & 4 R EDEVELOPMENT P LAN H IGHBRIDGE P ARTNERS F RANK F ARINELLA J R ., A LEX K ESZELI , S ARAH A NN R OZSA , M ATTHEW F ANELLI , S TEPHEN A LY , C HRISTOPHER B OYLAN
KEARNY POINT: FROM SHIPYARD TO FULLY INTEGRATED COMMUNITY PHASES 3 & 4 REDEVELOPMENT PLAN
HIGHBRIDGE PARTNERS
FRANK FARINELLA JR., ALEX KESZELI, SARAH ANN ROZSA, MATTHEW FANELLI, STEPHEN ALY, CHRISTOPHER BOYLAN
Strictly Confidential
Table of Contents
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Kearny Point, a former site of Amer eric ican an indu ndustr trial ialism ism and home of the Federal Shipbuilding and Drydock Company, is being transformed into an innovative hub for modern workspace. Through its evolution, it is now seen as a place of flexi xibil bilit ity, inventio ion and entre repr preneurs rship ip, attracting tenants from various industries. Along with its history and future potential, Kearny Point will provide tenants of all sizes the opportunity to be part of a developin ing g ecosys ystem
and non-profits to industry leading companies, Kearny Point will provide space for office, laboratory, artwork, hospitality, dining, and recreational enjoyment for all of the employees in the community.
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Kearny Point is centrall ally located, featuring easy access to the maj ajor r population ion centers rs of Newa wark rk, , Jersey Ci City, , and Manhatt ttan an, , while being conveniently located just 10 minutes from Newark wark Liberty y Interna rnatio tional al Airpo port.
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Kearny Point is located in close prox roximit imity multiple highways and local thoroughfares. There is easy access to the New Jersey turnpike via the Lincoln Highway, in addition to nearby connections to throughways such as Route 9, Interstate 280, and Interstate 78. Along with vehicular transportation, there are multip iple le transi sit t options in Newark and Jersey City, including, New Jersey Transit Passenger Rail, Hudson-Bergen Light Rail, PATH, and Hudson River Ferries. In addition, New Jersey Transit Bus Services are available in the area, while new stops and expanded schedules will be added for the future redevelopment of Kearny Point. KPIP is working with NJ Transit to arrange a shuttle bus service that would link with the Ligh ght t Rail station at West Side and Claremont Avenue in Jersey City. The redevelopment site will be pedestria rian and bike ke friendly dly with walking paths as well as designated bike lanes connecting all buildings and amenities.
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With investments surpassing $1 billion over the next several years in Kearny, NJ, 10,000 new jobs will be generated, accumulating millions in Local, County and State tax revenues. Since the site is deemed an opportunity zone, the redevelopment
skilled workers.
House usehol hold d Incom
Kearny, NJ: $61,558 Hudson County, NJ: $63,808 USA Avg: $59,039
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The surrounding workforce has increased dramatically in step with the revitalization
entrepreneurs who value innovation. The liveliness and of the area has created a neighborhood composed of both families and a growing white-collar population. The recent influx of workers was noted through a strong housing market and high population density. This is expected to further increase as Kearny Point’s development will create thousands of jobs. In close proximity to renowned colleges and universities, Kearny Point will benefit from an increased talent pool, matriculating from STEM and business programs.
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New Jersey offers numerous incentives that help pro romote te economic ic grow rowth th and
ity for entrepreneurs, startups, as well as established companies, allowing businesses to thrive. The NJ NJ Ignit ite program provides grants that subsidize the rent of early stage technology and life science companies in collaborative workspaces, while the NJ NJ Co-Vest st Fund and NJ NJ Founders s and Funders program help propel innovative
row NJ NJ Assistance Programs offer tax credits to businesses that create and help retain jobs in New Jersey. Kearny Point is located within an Urban Enterprise Zone, which benefits include reduced sales tax, tax-free purchases and financial assistance. The EDA also aims to foster innovation by nurturing the development of new technology through matching loan pro rogra grams, ms, tax incentiv ives, , and network rking g opportunit unitie ies with the investment community.
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The development will seek LEED Campus s Certif ific icatio tion for phases 3 and 4 of development by implementing various sustainability initiatives and practices including:
reen Ro Roofs fs – Reduces “heat island effect”, rainwater overflow collected into cisterns for reuse in the building's cooling system
Chille led d Beams s - Provide superior indoor air quality; quiet operation, and no draft
mic Windows s - Eliminates the need for blinds/shades and allows in abundant light without excessive heat and glare.
meab able le Asphalt lt – Reduces stormwater runoff rate and incidences of flooding
Plast astic ic Bottle le Re Restrict rictio ion – Employers provide refillable containers to be used at filling stations, reducing plastic usage and on-site litter
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Su Susta stain inabil bility is one of Kearny Point’s core values and focuses. Why y is sustainabi ainabili lity y impor
ant?
ase-up rates s for green buildings typically range from average to 20% above average.”
vacancy y rate for green buildings was 4% lower than for non-green properties – 11.7%, compared to 15.7%”
reased d pro rodu ductiv tivit ity, top talent attrac actio tion and re retentio ion, less frequent sick days, and decreased medical costs
Philad adelphi lphia a Navy y Yard
The Philadelphia Navy Yard is located in the Southern part
1,200 acre site consists of 7.5 million sf with a total of 13 million sf in the masterplan. The campus consists of office, research & development, industrial, and recreational space. There are currently more than 13,000 employees from companies such as GSK, Urban Outfitters, and Tasty Baking Company. The Brooklyn Navy Yard is currently undergoing a $2.5 billion redevelopment of the 330 acre property. There is a total development amount of 2 million sf, which will add close to 10,000 jobs by 2020. The property provides space for office, laboratory, manufacturing, technology, and food service
a 90% retention rate. Tenants at the property include, Wegmans Food Store, which will have a 79,000 sf store located in Admirals Row & 399 Sands. Additionally, Steiner Studios, a successful television and film studio, adding 180,000 sf.
Bro Brook
yn Navy y Yard
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Building 82 will foster a collaborative environment for its varied tenant
ible office space for start-ups and smaller companies, art studios s for the creative minds in and around Kearny, along with indu ndustr trial ial kitche hen space. Building 82 will mirror Building 78’s creative energy. In this space, we will seek a partners rship ip with 1776, a company offering an advanced co-working environment for its tenants. The 7 story building will consist of 30,000 sf floorplates (300 x 100), accommodating tenants of varying sizes. There will be a podium parking structure for the building, offering thre ree levels s of parkin ing g and a total of 276
supplies and equipment to their floor, along with 16 foot exposed ceilings. Parkin king g for Building 82 will be fre ree of charge rge, a perk that small tenants and studio space users will enjoy. Re Rendering ring of Exterio rior
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30,000 sf of clean, health department certified commercial kitchen space will allow chefs fs, , re restaura rants, ts, bake kers rs, , fo food artisa sans, , consulta tants, s, and culinar ary teachers rs to flourish at any stage in their
with bakery & studio space which is great for cooking classes, team building events, and even pop up dinners. 30,000 sf of art studio/galle gallery space will create the ideal environment for the cre reat ative ive energ rgy y at Kearny Point to flourish. Artwork produced in the studios can be utilized around the Kearny Point development site, adding characte cter and a defining
l café, which will provide craft beverages and a la carte lunch items.
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Potenti tial al Ki Kitchen Space Uses
The parking structure for phase 4 of the development will be impressive in size and scope. The podium garage will establish a foundation for which the life science, office, restaurants, conference center, and hotel will stand upon. The 445,000 sf garage will feature 1,369 spaces, all on one level, with elevator and stair access to each building. The roof of the structure will act as a gre reen n ro roof and space for Kearny Point’s
apin ing g and hard rdsc scap apin ing g on the roof, the garage acts as true ground d level. The parking structure will feature 5 en entry doors, allowing ingress and egress for employees and hotel or restaurant
walkab able le ramps s leading up from the center of Kearny Point, allowing all
there will be multiple terraces facing the Hackensack River,
Ingr gress/ s/Egr gress ss Gre reen Ro Roof View
The Phase 4, 12-story office space will provide tenants high quality and luxurious amenities within the building. The high end finishes and design will help bring talent to Kearny Point. A partnership with Convene to occupy two floors of the space will be beneficial to provide tenants with a vertically integrated community atmosphere within the building. The office will total 360,000 sf, offering larger tenants the potential to occupy large portions of the 30,000 sf floorplate. Additionally, the building will feature a service elevator to help move tenants in efficiently. Class-A Philadelphia Navy Yard space lends support for re rents ts in $40-$45 psf range. Re Rendering ring of Exterio rior
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Located between the Office and Life Science building will be a large amenit ity y space with confer ference ro rooms
including a 10,000 sf fitness ss center for use by all tenants at Kearny Point, a 5,000 sf quick ser ervice ce café, and 5,000 sf of open floor plan with multiple seating arrangements for collabora
tive working g and relaxation. The lower level will include 20,000 sf of confe ference ce ro rooms varying in size, allowing companies to use this space at their convenience. In the future, the conference center has potential to provide ancill llar ary y income for the owners. Each room will feature flat screen televisions, telecommunication services, and noise proofing to allow complete focus.
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NJIT Tower will be a hub of research and breakthrough in the life sciences community, catering to tenants performing chemistr stry y re researc arch, , biology y re researc arch, , and analy lyti tical al chemistr stry re resear arch
the scope of NJIT’s 2020 vision, Kearny Point will offer undergraduate students the opportunity to use this innovative space to further their
each floor plate, companies will be able to take full advantage of their square footage. The Building will total 150,000 sf and feature two service elevators for tenants to efficiently move equipment and products in and out of their
nd des esign of the space will allow for higher rents, starting near $35 Psf. Re Rendering ring of Exterio rior
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The development of Kearny Point into a fully ly integra grated ecosys yste tem m goes beyond workspace. The inclusion of dining options of higher quality than a typical cafeteria will provide employees and guests fun and enjoyable food options. The two restaurants will total 10,000 sf and be centrall ally located d between the office tower, life sciences building, and hotel. In choosing restaurants to occupy this space, we decided to include options that coincide with the sustainable and environmental standards of Kearny Point. Bryn n & D Danes nes will provide he healthy, , accel elera rate ted-ser service vice options ns, while providing a relaxing atmosphere. Iron Hill Brew rewery y will provide a sit-down option, where employees can network and share an after work drink. Re Rendering ring of Exterio rior
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The introduction of a large quantity of employees at Kearny Point will spark a need for ho hospitalit lity services for guests and employees of different companies. A hotel will be of maj ajor r convenie ience ce by mitigat gating g time was waste ted traveling to and from an offsite hotel. The hotel anticipates significant demand from tenants using the studio and shooting g space planned for phase 2 of the development. The hotel will provide services such as a small l fitness ss center, café and bar are rea, along with a small business ss center. There will be a total of 125 ro rooms ms, averaging 325 square feet. The interiors of the rooms will feature industry-leading ameniti ties, such as a glass shower with ceramic tiling, in-room check out, and laundry services. Potential hotel developers include Hilton Garden Inn and Study Hotels. Re Rendering ring of Exterio rior
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Examp mple les s of Select t Servic vice Brands
The construction timeline of Building 82 will start this year as the building is being turned over in possession. The total duration from permits and approvals to completion of construction will be 30 months. With the inclusion of 12 months of contingency time, maximum time to complete construction is 42 months. The construction period includes the completion
space.
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At year end 2021, permits and approvals begin immediately, and are anticipated to take . The next phase will include the demolition of the previous three industrial buildings, allowing for the completion of the parking garage. Once the parking garage is complete, the office, amenity and conference space, life sciences, restaurant and hotel will be completed in that respective order. Over the final three years of the project, landscaping of the green roof will take place, corresponding with building completions. The total completion time of phase 4 is 60 months.
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3% of Potential base rent 7.5% of Potential base rent 1.5% of NOI 23
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A sensit sitivit ivity y analysis sis was as created ted, , all else held d equal ual, , by y adjust justing ng cap rates s on refin inancin ancing g and d ultima imate te sale from m 7.75 75% % in the e wo worst t cas ase, , 6.75% 75% for the e bas ase e cas ase, , and d 5.75 75% % for the best st cas ase.
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Appendix – Site Renderings
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Appendix - Development Costs
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Appendix - Inputs and Assumptions
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Appendix - Worst Case Return
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Appendix - Best Case Return
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Appendix – Product Costs
Life fe Sciences
Appendix - Product Costs
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An adjustment factor of 12.5% was applied to the gross number of spaces needed to account for shared parking and increased future utilization of public transportation.
Appendix – Product Costs
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Appendix – Relevant Market Information
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Q4 2018 Cushman & Wakefield Report CBRE 1st ½ 2018 Study