A development company that is upgrading the city’s old post office on southern Frank Sinatra Drive is hoping to get permission to develop a Hilton hotel on the site of the current loading and parking zone.
Robert Reed of KMS Development Partners said he’d like to see the structure built by 2019. So far, the city has a W Hotel, and may include a different hotel in its proposed Southwest Redevelopment Area (see other cover story).
KMS was contracted by the postal service in 2012 to upgrade its facilities to make them more efficient and modern, including a new freight elevator and larger loading dock.
“The package business is going through the roof,” Reed said, “and this really helps them to accommodate current and future growth.”
The inclusion of a hotel on the postal service land would provide the city with an estimated 1.6 million dollars in yearly taxes, said KMS Development Partners’ Dennis Martin.
Martin explained that because the federal government owns the post office, the city currently receives no tax revenue from the location.
The hotel will have 283 guest rooms
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The process
The proposed hotel would have 283 guest rooms, a fitness center, valet parking, a restaurant, a 6,000 square foot rooftop event space and terrace, and an equally sized meeting and conference facility.
But the developer would have to go through the city’s planning process and get approvals and city support like everyone else.
So far, the developers have met with local residents, including a major waterfront activist group.
Ron Hine of the Fund for a Better Waterfront has already said he supports the project.
Reed said that after getting community input, the development company tweaked its design, adding a sidewalk on Newark Street and Frank Sinatra Drive where there currently isn’t one, scaling back the property line to be the same depth as the other buildings on the street, and adding outdoor lighting.
According to Martin the contract with the post office will expire soon and it will be challenging for them to receive an extension unless they see “some real action” from the City Council.
The council recently approved a resolution to look for an expert consultant who will help the city negotiate regarding what to build on the property.
According to city spokesman Juan Melli, “the city is working on hiring a hotel consultant who will be responsible for examining the type of hotel that would be appropriate for the Hoboken community. The city is working to qualify several hotel professionals at the Nov. 2 council meeting, one of whom would be selected to focus on this project.”
Martin hopes the city will have a consultant selected by the next council meeting next week.
After that, a City Council subcommittee, working with the Department of Community Development, and planning consultants, would draft a redevelopment plan describing what they would like to see built. The council would have to hold a hearing and vote on the ordinance. Then the Planning Board would consider the plan. The plan’s adoption would be followed by a project specific redevelopment agreement between the city and a designated redeveloper.
Melli said the city is currently working on the redevelopment plan “to ensure any hotel is of an appropriate size and type that will not impact traffic in the area.”
According to Melli the city is concerned with hotel patrons and postal vehicles parking on city streets. The development team said that the postal vehicles will either be in the loading dock or underground garage, and the hotel guests with cars will have valet parking in private lots.
Reed and Martin said they believe the City Council has not been dragging its feet, but has a lot on its plate. “We recognize that the municipal approval process for redevelopment projects is a critically important function of local government and often takes a considerable amount of time, especially in a densely populated city like Hoboken,” wrote Martin in an email. “That said, it has been our experience that when building similar types of public/private development projects in other municipalities, especially those with as many tangible benefits for the host community as this one, that the process usually takes about three to four years on average, from approval through construction.”
According Martin and Reed, the city designated the site an “Area in Need of Rehabilitation,” back in 2012. Then the city’s Department of Community Development drafted a redevelopment plan with help from a planning consultant, and a City Council subcommittee.
The developers believe the process will be quicker once a consultant is selected.
According to Councilwoman Tiffanie Fisher, who has over 20 years of experience working in commercial real-estate finance, the expert hotel real-estate consultant is an additional tool to assist the city in redevelopment negotiations and plans.
“This isn’t a ‘nice to have’ tool;” she said. “It’s a ‘need to have tool’ in a city like Hoboken in our positioning relative to New York City. Now [with] a sizable redevelopment with sophisticated developers, we need this tool on our side of the table.”
According to the developers, the Hilton Hotel won’t be in competition with the W, due to different target markets and loyalty members.
Councilman-at-Large David Mello said one of his biggest concerns when discussing hotels in Hoboken is ensuring that they are diverse.
“My biggest concern is not whether we should pave the way for more hotels to come into town,” said Mello. “My concern is that it be the proper mix of hotel types… we have a higher end in the W. We should get something lower end. We should get an extended stay. So I want to diversify our offerings along price points, type of services they offer, and the hotel chains.”
Marilyn Baer can be reached at marilynb@hudsonreporter.com.