NEWARK-The Supreme Court recently came out with a ruling on Iron Mountain Information Management Inc. v. The City of Newark, which impacts whether or not commercial tenants are entitled to notice of a proposed blight designation under the provisions of New Jerseys’ Local Redevelopment Housing law. The issue before the New Jersey Supreme Court was whether a long-term commercial tenant, with a limited right of first refusal, is entitled to the same notice as the property owner when the property is subject to a potential blight designation.

On May 19, 2010, the Supreme Court held that the legislature intended to limit the right to actual notice of blight designation to owners of record and those whose names are listed on the tax assessor's records, and Iron Mountain was not deprived of any due process protections afforded by the New Jersey or US Constitution. This raises some interesting points for commercial tenants in the state, says John S. Stolz, partner of Lowenstein Sandler’s real estate practice group.

But first, some background. In 2004, the Newark Municipal Council adopted a resolution authorizing the Planning Board to investigate whether a group of properties, including the building in which Iron Mountain is a tenant, qualified as blighted, Stolz relates. “Following the publication of a notice of hearing and service of the notice on the building owner, the Planning Board held a public hearing and concluded that the property met the applicable criteria for a blight designation,” he tells GlobeSt.com. “A resolution was adopted designating the blighted area and directing that a redevelopment plan be drafted. The Planning Board held another public hearing to consider the redevelopment plan and adopted resolutions approving the development plan and appointing the housing authority to serve as the redevelopment agency.”