June 25, 2018
The Grow New Jersey program is discussed.
"The program, spearheaded by the state’s Economic Development Authority, has helped fill vacant properties throughout the state, with companies agreeing to move to certain areas in return for tax credits. Building owners use the incentives to market space to companies that can take advantage of the tax credits.
“'When companies are told they’ll be given bonuses to move to that location, the location moves from the No. 3 spot to the No. 1 choice,' said Ted Zangari, chair of the real estate department and public policy practice group at Newark-based law firm Sills Cummis and a legal advisor for companies seeking to take advantage of the program.
“'Large empty office buildings in suburbia are filling up because of Grow NJ,' Zangari said, citing a company that moved to Neptune Township over Woodbridge’s MetroPark in order to take advantage of the tax credits.
"Zangari said the program grew out of the 2008 recession and has been effective in retaining companies and attracting new ones.
“'Typical competition for New Jersey are the crescents of states around us,' Zangari said. 'The Grow NJ program has been generous enough to narrow the gap even with states in the Sun Belt. Generally companies are evaluating multiple states and that’s when the program becomes vital because all states around New Jersey with the exception of New York are cheaper than New Jersey.'
"But with the program set to expire in July 2019, Zangari said the state needs to assess and extend the program sooner rather than later.
“'I and other real estate professionals hope the program will be extended before that,' Zangari said. 'It would be highly unwise for the legislature and the governor to wait until July to make a decision as to the fate of Grow NJ. I’m already hearing from other brokers that companies are looking at other states because they don’t know the fate of the program.'
"He added that brokers look for space far ahead of lease expiration.
“'Most companies that are looking for space in 2019 have already begun the process,' Zangari said. 'The program is starting to lose its vigor and by the fall it could be perceived by the real estate community as dead. We need to mend and extend the program.'”