When it comes to new construction in Jersey City’s Journal Square, no firm is more prominent than Kushner Real Estate Group, which has continued development of the massive Journal Squared complex with the recent ground-breaking of the project’s second skyscraper, now climbing above ground level. YIMBY spoke with the firm’s eponymous president, Jonathan Kushner, to discuss the site and its impending second and third towers, KREG’s general portfolio growth, as well as Mr. Kushner’s outlook on the state of the neighborhood and the local market.
YIMBY in bold.
With 16,000 apartments either built or in the works, momentum seems to be on your side. When do you expect to hit 20,000 total units?
KRE Group has built nearly 10,000 apartments in the Tri-State Area and we have another 6,000 units in the pipeline. We’re currently on track to deliver roughly 1,000 units each year. These apartments are located in both urban and suburban areas across New Jersey and in Pennsylvania.
Journal Squared is already transforming the surrounding neighborhood. When did you acquire that site and how many more years will we have to wait until all three towers are finished?
KRE began assembling the Journal Squared site in 2007. When finished, the mixed-use development, which is designed by Hollwich Kushner and Handel Architects, will bring a total of 1,840 rental apartments to Journal Square, a transit-centric neighborhood on the brink of a major revitalization. We broke ground on the first tower in 2014 and opened it to residents in 2017. Last year, we broke ground on the second tower, which will top out at 70 stories, making it the tallest of the three buildings. It’s slated to open in 2021, and we expect to break ground on the third tower that same year. If this cycle continues, the entire development should reach completion by 2024.
With construction already progressing on Phase II of Journal Squared, it seems as though the neighborhood is successfully absorbing the new inventory. Beyond Journal Squared, do you have plans for additional developments in the vicinity?
Demand for luxury apartments in Journal Square is very high. For example, the first Journal Squared tower, which consists of 538 apartments ranging in size from studios to three bedrooms, was fully leased in less than 10 months. On the heels of this success, KRE is currently under contract for additional sites in the neighborhood with plans to build. We’re constantly looking for new opportunities in the area.
What implications do you think the slow and steady resurgence of Downtown Newark will have on the cities in between Newark and Manhattan?
We’re delighted by the resurgence of Downtown Newark. This revitalization will only have positive effects on New Jersey as a whole. For example, we’ve seen an uptick in interest for our Jersey City properties—in particular at 485 Marin, a 397-unit luxury rental development in Hamilton Park—from prospective renters who’ve recently taken jobs in Newark, but enjoy the lifestyle that Jersey City affords.
On a related note, do you see Newark being the next logical step in the building boom that first encompassed Downtown Jersey City and then Journal Square?
It’s difficult to say because I’m not familiar enough with the Newark market. But similar to Jersey City, Newark’s proximity to Manhattan is a major selling point for developers and investors. Newark is a reviving urban center that certainly has the potential for substantial growth in the coming years.
The tallest buildings in both New York and New Jersey, by roof height, will soon be residential (Central Park Tower and 99 Hudson Street). With Phase II of Journal Squared currently set to be the tallest component of that development, what is stopping you from trying to break the new record on the waterfront with Phase III, especially with the success you have already seen?
KRE aims to build financially viable projects that make sense for the location and surrounding community. It’s not about being the biggest or the tallest—we don’t build to set records.
Come 2040, do you think Journal Square will retake its mantle as Jersey City’s focal point from the waterfront?
I hope it happens earlier than 2040!
An additional concern regarding the above is sea level rise. Jersey City’s waterfront, and Hoboken, are very prone, and are likely to be substantially flooded by the end of this Century without human intervention. Do the arduous infrastructure requirements for protection against this threat offer an additional indicator of Journal Square’s relative resurgence versus Downtown?
It’s imperative that we protect our communities from the effects of sea level rise and flooding. I can’t say if, or when, the Jersey City and Hoboken waterfronts will experience substantial flooding. However, we’ve designed and built all of our projects, regardless of location, to withstand the test of time. Building for the short-run is never an option. I don’t find infrastructure requirements to be arduous. These safeguards are an extremely necessary and important part of the planning process.
What else are you working on at the moment?
In the fall of 2018, we opened 485 Marin, the newest and largest rental development in Hamilton Park, and we’re extremely pleased with the project’s success to date—485 Marin is now more than 90% leased. As part of this development, we built Marin Green, a new public park that includes more than an acre of green space for the community to enjoy. It opened in November.
In addition to our ground-up residential developments, my brother-in-law Jeremy Kaplan and I have spent the past ten years focusing on the growth of KRE’s in-house capabilities. We intend to continue growing all sides of these operations, including building and construction management. We’ve also focused on acquiring existing garden-style apartment properties throughout the state of New Jersey. We’re able to improve these properties through capital investments such as unit renovations and amenities upgrades, as well as improved property management. These apartment buildings are located in highly desirable neighborhoods where brand new rental inventory is limited.
Last summer, we acquired Thousand Oaks Village in Atlantic Highlands—now Atlantic Pointe—and recently brought the first of our new, modernized units to the market. In the spring of 2017, we purchased Summit Hill, a 228-unit apartment property in Springfield. Since then, we’ve made substantial improvements, including the addition of a new clubhouse for residents. That same year, we also purchased Addison at Princeton Meadows, a 439-unit rental property in Plainsboro, which is now under our management and is being renovated.
Are you content with New Jersey, or is expansion to New York in the cards for KRE’s future?
New Jersey has been great to our family and we’ll continue to be great to New Jersey. However, KRE is also investing in sites and projects outside of the New York, New Jersey and Pennsylvania markets. We’re looking into major markets around the country and look forward to announcing these projects and bringing them to fruition.