SQUARE REVIVAL PLAN DRAWS FIRE

By Jason Fink, Journal staff writer

October 10, 2002

The Jersey City Economic Development Corp. is planning to pump $4.5 million into various improvement projects in Journal Square, but some are balking at how the money is to be spent.

Officials at the EDC, a nonprofit, quasigovernmental agency that disburses state matching funds to the city's Special Improvement Districts - including the one in Journal Square - say the expenditure is prompted by pressing safety and aesthetic concerns, while some SID members have grumbled that the money is actually a handout to deadbeat landlords.

At issue are plans by the EDC to pay for facade improvements on the Hotel on the Square building, an aging, largely vacant structure that sits in the center of the Square's pedestrian plaza.

Plans are also in the works to add lighting and put up a new fence behind the building, at the edge of an adjacent parking lot, near several Dumpsters.

At a regular meeting of the SID board of trustees, several property owners - who pay special taxes to belong to the business district - said rather than paying to fix up the Hotel on the Square and the surrounding area, it would make more sense to just condemn the building and tear it down, opening the door for an entirely new development.

"That building is a rat's nest," said Ary Freilich, who owns 26 Journal Square, across Sip Avenue from the hotel building. "This is nothing more than pasting on post-its and calling it urban renewal."

Several retail stores and restaurants have opened on the ground floor of the former hotel in recent years, but the top floors remain unoccupied.

The owner, listed on city tax records as Oxford Acquisition L.P. of Manhattan, has been issued numerous health code violations for the Dumpsters behind the building in the past, city officials say.

Attempts to reach the owner yesterday were unsuccessful. There is no listing for Oxford Acquisition L.P. in New York City.

Don Smartt, the administrator of the Journal Square Restoration Corp., the SID management arm, conceded that there have been problems with the building but said the city's plan should be welcomed by the business community.

"The (city) administration is reacting to the investment community, the residents," Smartt said. "These improvements are cosmetic, but they are important."

Smartt said the added lighting and fencing, in combination with the Restoration Corp.'s plan to hire off-duty police officers to provide security in the area, would make the Square safer and more attractive to shoppers and commuters.

The Restoration Corp., which shut down and laid off all its maintenance and security employees earlier this year under a mountain of debt, has also hired 17 new maintenance workers, according to Smartt. This summer, the city formed a task force to help coordinate efforts to improve the Square, a transportation and retail hub that was once among the city's most elegant shopping and entertainment centers.

But the Hotel on the Square, which has been the focus of several ambitious but ultimately unrealized development proposals over the past decade, remains a point of contention.

Ward C Councilman Steve Lipski, who represents Journal Square on the council and also serves on the city Redevelopment Agency, said he thinks the property should be condemned and eventually torn down.

The owners, he said, lease the adjacent parking lot from NJ Transit and sub-lease it to Kinney parking lots to operate, earning $15,000 a month in tax-free rent.

"They've got a cash cow," Lipski said.

He said he has a plan to initiate condemnation proceedings - which would have to be carried out by the Redevelopment Agency - and take the matter to court at a cost of about $10,000 to $15,000.

The potential benefit to seeking a new owner or developer would far outweigh that cost, Lipski said.

"It's a blight on the Square," he said. "We want to see long-term planning that is substantive."

Jason Fink can be reached at jfink@jjournal.com