UPDATE
By: Vic Monaco
HIGHTSTOWN The Herald learned Thursday night that a market research study expected to be formally unveiled Tuesday concludes that the borough’s limit of 80 residential units for the former rug mill property is not economically feasible for any developer.
Councilmen Larry Quattrone and Patrick Thompson confirmed the information Friday but each had a different take on how the report might affect the borough’s most important project.
Mr. Quattrone said the report shows that a developer would make only about $278,000 if limited to 80 units on the 7-acre site along Bank Street. That, he said, is simply not enough profit on the project, the estimated cost of which is $25 million to $30 million.
"Of course not," he said, adding, "It would take at least three years to make $200,000."
If, however, the developer were allowed to build 98 units, as has been most recently proposed, the profit would be about $3 million, Mr. Quattrone said the report states.
Mr. Thompson, meanwhile, is not yet convinced that 80 units couldn’t work. He said Friday that if market consultant Pete Sockler had used the most recent proposed sales prices of the condos and townhomes planned at the site, rather than lower estimates, a developer could see a profit of as high as $4 million.
"It’s still far from clear," Mr. Thompson said. "If you make some small adjustments and tweaks, it makes a dramatic difference in the profit."
While acknowledging that the borough sought Mr. Sockler’s expertise in market prices, Mr. Thompson said he may wind up disagreeing with the consultant’s pricing estimates. Or, he said, he could come to the conclusion that the borough’s redevelopment ordinance needs to be amended to include a higher maximum number of units.
He and Mr. Quattrone did agree that they see no sense in amending the ordinance before seeing if other developers respond to a request for proposals, which has just been released and carries a March 20 deadline.
"I’m not willing to do anything until we see that," Mr. Thompson said.
After working about two years with the development firm Greystone Mill and an associate of that firm, the Borough Council voted 4-2 Feb. 6 to issue the request for proposals.
Mayor Patten, a proponent of the 98-unit proposal on the table, said this week that amending the ordinance could take a couple of months.
Greystone Mill has an agreement to purchase the land from two local owners.