Another Redevelopment Project Brewing in Seaside Heights?
Last week, the Seaside Heights Borough Council unanimously approved a resolution requesting its Planning Board to investigate whether a motel property on Ocean Terrace qualifies as an “area in need of redevelopment” under the New Jersey Local Redevelopment and Housing Law, N.J.S.A. 40A:12A-1, et seq. The property, a motel currently operated as the Surfside Motel and Apartments, is located at 200 Ocean Terrace, just across the street from the Seaside Heights boardwalk.
A recent story in Shorebeat.com indicates that the Borough has asked the Planning Board to consider the property as a “non-condemnation” redevelopment area, meaning that the power of eminent domain would not be authorized, but the municipality would have the power to undertake a redevelopment “project.”
Under the Local Redevelopment and Housing Law (“LRHL”), a redevelopment designation would give the Borough the power to adopt a redevelopment plan which can create new or additional zoning for the properties in the area and to provide some controls over any redevelopment through a redevelopment agreement with any designated redeveloper. Prior to 2013, all redevelopment designations in New Jersey pursuant to the LRHL automatically provided municipal agencies with the power of eminent domain to undertake redevelopment projects within their boundaries. However, the LRHL was amended in 2013 to create two different types of redevelopment designations and projects: a traditional redevelopment project authorizing eminent domain, and a “non-condemnation” redevelopment area which permits towns to utilize all redevelopment powers under the LRHL except for the power of eminent domain. More information on this amendment to the law, which was intended to expand redevelopment opportunities without involving the contentious issue of eminent domain, and created a new option for NJ municipalities, is available in this article by MROD partner Anthony DellaPelle.
Since Seaside Heights apparently is interested in a redevelopment designation that does not avail the Borough of the power of eminent domain, any future redevelopment would be undertaken by either the current owner or any buyer of the property who could then seek to be designated as the “redeveloper” for the project. The recent news report indicated that the property was the target of an “investor from the Boston area”, who has an interest in developing the property with a 180-room hotel and banquet facility. However, because the Council has just started down this road, it is possible that it may try to change course and include the power of eminent domain in the future if things don’t pan out as is currently reported. The request from the Borough Council to the Planning Board is only the first step in the redevelopment process under the LRHL, with several other actions to follow before a redevelopment project can proceed. With that in mind, we’ll keep an eye on this project and report back once more is known or develops.