NEW BRUNSWICK, NJ-This year’s RealShare New Jersey, held for the first time at the Hyatt here, also had a decidedly more upbeat tone than in previous years. With around 400 attendees, the panels covered everything from data centers to distressed assets.
Kicking things off was Jeff Milanaik, president of Heller Industrial Parks Inc., who engaged in a discussion with ALM-Real Estate Media Group vice president and group publisher Michael Desiato. The duo discussed some downsides, such as the Bayonne Bridge fiasco (namely, the fact that the bridge is not tall enough to accommodate larger container ships that will come through the port once upgrades to the Panama Canal are complete in 2014, or sooner), as well as concerns with the fee levied on developers by the Council on Affordable Housing. But, some positive indicators, said Milanaik, include “an uptick in container traffic,” at least for now, “and also an increase in manufacturing.” For its part, Heller is pushing solar initiatives at nearly all of its properties. And Milanaik mentioned this would be a major focus going forward.
Next up, New Jersey Economic Development Authority CEO Caren Franzini moderated a lively discussion between Mitchell Hersh, president and CEO of Mack-Cali Realty Corp., and Charles Klatskin, managing director of industrial at Jones Lang LaSalle. Franzini began by noting that Gov. Chris Christie has made some major strides in reversing the notion that New Jersey is closed to businesses. What’s more, he has taken several key steps to reduce regulations, including appointing a Red Tape Commission to tackle development hurdles.
But Klatskin was less optimistic about the state of the state. “The COAH fee is being saved by municipalities,” he said. “It’s not actually being used. It’s a ridiculous fee.” He added that now, New Jersey has decided to hold off on making a decision on COAH until next spring. “It’s a New Jersey thing--just put it off and the problem will go away.” He commented that “the market stinks. Sure you have a deal here or there, but in general, it’s awful.”
Hersh took a more optimistic approach, noting that although “New Jersey is at the top of the list for doing things wrong historically, we finally have an administration that has a vision for the future.”
But Klatskin wasn’t so sure. “The issue is what you can actually get done in Trenton, and now just what you say you’ll do.” Still, Hersh said, “at some point we will see rising interest rates and, historically, inflation has then moved up very quickly, which is a good sign for real estate.”
Following a networking break, six industry executives joined to discuss data centers. Guided by moderator Jonathan Meisel of JLL, panelists Gus Milano of Hartz Mountain Industries, Michael J. Pembroke at Russo Development, Kevin O’Brien at Structure Tone, Jeff Hipschman at CB Richard Ellis and PSE&G’s Will Steffens, the discussion centered largely around power sources. Indeed, the Garden State is an ideal location for data centers because of its access to water and its infrastructure. But despite their low volatility, which is a very real plus, developers should be aware that the turnaround time to build a center is about 13 months. Hipschman said, “I’ve never heard anyone say take your time when building a data center.”
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