Case Studies


City of Elizabeth – Wakefern Food Corp. Warehouse

On December 30, 2010, MSB closed a $46,800,000 financing transaction for Elberon Development Co., L.L.C. which included the issuance of $44,499,000 in Recovery Zone Facility Bonds. The project includes the demolition and construction of a 524,000 sq. ft state-of-the-art warehouse for Wakefern Food Corp. in Elizabeth. Wakefern, operating under the names ShopRite and PriceRite, is a member-owned wholesale distribution cooperative, supplying over 200 stores with groceries and other merchandise along the eastern seaboard, including New Jersey, New York and Pennsylvania. The new warehouse will replace an existing structure that has housed Wakefern’s operations for over 50 years. For each of those 50 years Elberon Development Co. and its affiliate, Elberon Development Co., L.L.C., has owned and managed the site while maintaining a strong commitment to the City of Elizabeth.

The Recovery Zone Facility Bonds were issued by the Union County Improvement Authority under the federal 2009 American Reinvestment and Recovery Act which terminated after December 31, 2010. The RZFBs were a federal bond program permitting governments to issue tax-exempt, private activity bonds to spur private investment in new projects. Despite the State of New Jersey’s sizable allocation of volume cap for RZFBs, many projects were not able to take advantage of the benefits of the RZFBs due to a variety of factors, including project readiness, credit worthiness of the borrowers, and the time constraint on the issuance of the RZFBs.

In spite of these obstacles, the project received volume cap allocation from the City of Elizabeth ($3,931,000), the County of Union ($15,568,000) and a reallocation of volume cap from the State ($25,000,000). The construction loan was secured through TD Bank, N.A., which purchased the RZFBs and provided a construction term loan and a revolving line of credit to assist in the construction of the Project.

For more information on this project, please contact Joseph P. Baumann, Jr., Member, at (973) 622-1800.

 

Joseph P. Baumann, Jr.

City of Newark – Teachers Village

MSB represented RBH Group, and its affiliates, in the third and final phase of the multifaceted and complex financing of the Teachers Village Project at Four Corners in the City of Newark, New Jersey (the “Project”), which was awarded the New Jersey Future’s 2013 Smart Growth Award.

The Project is a mixed-use development consisting of the construction of eight separate buildings and shared parking lot areas to provide 205 units of residential workforce housing, three charter schools, one pre-school/day care (together serving approximately 950 students), and approximately 63,000 square feet of rentable retail space, as part of the redevelopment of downtown Newark. MSB was central to structuring the financing of the Teachers Village Project, which financing consisted of New Markets Tax Credit leveraging public financing including Qualified School Construction Bonds, Redevelopment Area Bonds, and Urban Transit Hub Tax Credits. MSB was able to assist the developer in taking advantage of the various financial tools available to public and private entities in redevelopment areas due to the firm’s extensive background in public finance and tax. Additionally, we assisted the developer in various real estate and land use aspects of the Project, including transfers, easements, consolidating the properties, perfecting various subdivisions, and in this final phase, creating a condominium form of ownership. MSB also formed all special purpose entities required by the various lenders as well as assisted the developer in monetizing its Urban Transit Hub Tax Credits, the first securitized Urban Transit Hub Tax Credit deal in the State of New Jersey.

For more information on this project, please contact Glenn Scotland, Member, at (973) 622-1800.

Glenn F. Scotland, Leah Sandbank

Seafrigo Coldstorage Refrigerated Warehouse

On May 20, 2014, the Firm closed a NMTC financing of the construction of a state-of-the-art refrigerated warehouse for a private client in the City of Elizabeth. The NMTC closing served as the permanent financing for the project and reduced the client’s overall cost of financing through the equity investment of $2,381,000 coupled with a leverage loan of $5,654,400. For more information about this transaction, please contact Jong Sook Nee or Lillian Plata.

City of Newark – The Friends of TEAM Academy Charter School – 18th Avenue School

In September 2014, the firm represented The Friends of TEAM Academy Charter School and its affiliates in a twinned New Markets Tax Credits/Historic Tax Credit transaction to finance the historic rehabilitation of a school facility located at 229 18th Avenue in Newark.  With the same financial institution acting as tax credit investor for both the New Markets Tax Credits and the Historic Tax Credits, and utilizing federally subsidized Qualified Zone Academy Bond and Qualified School Construction Bond funds as well as equity to fund project costs, the financing generated approximately $6.5 million in tax credit equity for a $36 million project budget.

This transaction involved compliance with multiple federal programs, including a new IRS revenue procedure, affiliate entities acting as direct lender and leverage lender, tax-exempt entity and related party considerations, the establishment of multiple entities to act as direct lender, member managers, project owner and master tenant and complex structuring requirements.

McManimon, Scotland & Baumann has extensive experience working with federal tax incentive programs such as New Markets Tax Credits, Historic Tax Credits and qualified bonds, as well as with financing for charter schools and 501(c)(3)s.

For more information on this project, please contact Leah Sandbank, Member, at (973) 622-1800.

 

This image is credited to KSS Architects.

Glenn F. Scotland, Leah Sandbank

City of Newark – Downtown/Arena Redevelopment

We acted as redevelopment counsel to the Housing Authority of the City of Newark which carried out the Downtown Core Redevelopment Project in the City of Newark, consisting of the acquisition, development and construction of the multi-purpose Prudential Center. We also assisted with the issuance of $200,420,000 in bonds to support the financing of the Downtown Core Redevelopment Project.

For more information on this project, please contact Glenn F. Scotland, Member, at (973) 622-1800.

Glenn F. Scotland, Demetrice R. Miles

Township of Little Falls – Municipal Building

In 2001, the Township of Little Falls embarked on replacing its 80-year-old municipal building with a brand new, state-of-the-art municipal facility located on Main Street in the Township. McManimon, Scotland & Baumann, LLC worked with the Township from 2001 through the groundbreaking in 2004, on financing all aspects of this project, from site work to construction to acquisition of furnishings. Our firm worked with the Township and its professionals to draft multiple bond ordinances and issue several series of bond anticipation notes to “ladder” the construction fund in an effort to minimize the interest expense on the Township’s budgets.

We acted as bond counsel when the Township issued its General Improvement Bonds in 2001 and 2003 to permanently finance the project and lock in long-term tax exempt interest rates. The General Improvement Bonds are secured by the ad valorem taxing power of the Township. The Township expanded the facility, with the addition of a Justice Center Complex, funded with government-subsidized “Build America Bonds” authorized by the American Recovery and Reinvestment Act of 2009.

For more information on this project, please contact Matthew D. Jessup, Member, at (973) 622-1800.

Matthew D. Jessup

City of Bayonne – Bayonne Crossing

Our firm worked with The Hudson County Improvement Authority, the County of Hudson, the City of Bayonne Redevelopment Agency and the City of Bayonne (the “City”) in a multi-public body financing through the New Jersey Environmental Infrastructure Trust (the “NJEIT”) of a portion of a redevelopment project consisting of the remediation of a former petroleum site and the construction of a 356,000 square foot “big box” retail project located in the City of Bayonne.

The financing, secured by Payments In Lieu Of Taxes, a Letter of Credit during construction and guaranties of the County and City, involved ten different public entities, required over 80 public votes, 23 different public/government approvals and permits and endured multiple lawsuits, all during an economic recession. The success of the financing depended on our firm working closely with each of the public entities, the redeveloper and the NJEIT in creating solutions to questions never asked of the NJEIT in prior financings. As a result, in part, of our prior experience with the NJEIT and our working relationship with members of the NJEIT and the New Jersey Department of Environmental Protection, a severely contaminated 30-acre parcel of land has been replaced with an exciting new retail power center that generates tax revenues, urban enterprise zone revenues and hundreds of full-time jobs.

For more information on this project, please contact Joseph P. Baumann, Jr., Member, at (973) 622-1800.

Joseph P. Baumann, Jr., Matthew D. Jessup, Christopher B. Langhart

City of Perth Amboy – Construction of Municipal Facilities

In 2003, the City of Perth Amboy financed the construction of its Public Safety/Court/Recreational and Community Center and its Fire/Emergency Medical Services Facility through the Middlesex County Improvement Authority’s issuance of $43,100,000 Lease Revenue Bonds, Series 2003. McManimon, Scotland & Baumann represented the City in crafting a financing structure that included the acquisition of necessary land by the City, ground lease of the land by the City to the Middlesex County Improvement Authority, sub-lease of the land by the Middlesex County Improvement Authority to the City and a converting lease-to-fee ownership by the City of property originally owned by Conrail. The City pays debt service on the bonds through lease payments it makes to the Middlesex County Improvement Authority pursuant to the sub-lease.

For more information on this project, please contact Edward J. McManimon, III, Member, at (973) 622-1800.

Edward J. McManimon, III, Matthew D. Jessup

Township of West Orange – Liberty Middle School

McManimon, Scotland & Baumann, LLC has represented the West Orange Board of Education over many years. We have assisted in connection with referenda, lease purchases, certificates of participation, equipment leases, bonds and shared services transactions, as well as contract, bidding, dispute resolution and project implementation matters. The new Liberty Middle School was financed in 2003. The project cost $30,012,000 and was financed with State grant funds available under the Educational Facilities Construction and Financing Act in the amount of $6,348,000 and local school district bonds in the amount of $23,664,000. The Liberty Middle School opened in December 2005 and is the newest of the eleven schools in the district and the second middle school.

For more information on this project, please contact Andrea L. Kahn, Member, at (973) 622-1800.

Andrea L. Kahn, Charles Anthony Solimine

City of Elizabeth – Jersey Gardens

We represented the New Jersey Economic Development Authority in the structuring and issuance of $140,552,550.30 in bonds under the Large Site Landfill Reclamation and Improvement Law to finance infrastructure and remediation costs associated with the Jersey Gardens Outlet Mall in Elizabeth. In 1998, this success story demonstrated the effectiveness of the law, but also the limits. This law eventually became the model for the Redevelopment Area Bond Financing Law that serves as the main financing tool for redevelopment in the State of New Jersey. For more information on this project, please contact John V. Cavaliere, Member.

 

John V. Cavaliere

City of Millville – Levoy Historic Theatre

McManimon, Scotland & Baumann, LLC represented the City of Millville, New Jersey, in connection with a redevelopment project to refurbish and restore a historic theater in the City. The City leveraged Urban Enterprise Zone and other redevelopment grants and funds into the project, resulting in a $6,810,301 loan to the borrower. The financing included a combination of loans, grants, equity and conventional bank financing from various sources. For more information on this project, please contact Glenn Scotland, Member.

Edward J. McManimon, III, Glenn F. Scotland, Leah Sandbank

Elizabeth Parking Authority – Elizabethtown Plaza Parking Garage

McManimon, Scotland & Baumann, LLC, represented the Elizabeth Parking Authority and a newly formed 501(c)(3) non-profit corporation formed on behalf of the Parking Authority to complete a highly complex NMTC transaction involving a host of public stakeholders and their respective professionals, to finance the design, development, construction, operation and maintenance of an approximately 1,500-space, multi-level parking garage and related facility in the City of Elizabeth. This transaction involved multiple revenue sources, including public debt issued by the County of Union and Union County College, and an $11,875,000 NMTC loan. In addition to the NMTC financing, the firm completed in June 2010 the remainder of the $35,000,000 project financing using Recovery Zone Economic Development Bonds authorized by the American Recovery and Reinvestment Act of 2009. For more information on this project, please contact Glenn Scotland, Member.

Glenn F. Scotland, Leah Sandbank, Bakari G. Lee