Hoboken garage site bids well short of expectations

Hoboken garage site bids well short of expectations 
June 02, 2006

HOBOKEN - It was a disappointing holiday weekend for city officials reviewing bids for the one-acre municipal garage redevelopment site on Observer Highway.

Prior to the deadline, before the close of business Friday of the Memorial Day weekend, only two developers submitted bids on the property - and both were short of what the city had been hoping for, said Fred Bado, director of community development.

According to Bado, the top bid of $22.1 million was submitted by Metro-Ran Garage Stop LLC - a partnership consisting of Robert Ranieri, Jr., Dean Geibel, and Louis Picardo, who is also the city's tax collector.

The lower bid of $18 million was submitted by Applied Development Company and Cali Futures LLC.

The two offers fall well short of the $30 million or more city officials were touting when the redevelopment zone was first approved in March, leaving Mayor David Roberts and the City Council to decide whether to accept one of the offers or go out to bid again.

Last year, the city used the garage in a sell-and-lease-back agreement with the Hudson County Improvement Authority, which enabled it to float $8.5 million in bonds to plug a $7.9 million budget hole for the 2005 fiscal year.

When faced with a budget crisis again this year, city officials planned to buy the garage back and then sell it to a developer at a substantial profit to fill a $5 million budget shortfall for the 2006 budget.

If the city can't come up with at least $5 million by June 30, the last day of the fiscal year, officials will be forced to refinance the debt with the county at a much higher rate.

Bado said he believes just two developers submitted bids because of environmental concerns coupled with time constraints on the project, and an inability to maximize the density of the building.

Councilman Peter Cammarano urged the mayor to reject the bids and get new ones, this time telling developers they can build a taller building with more units on the property.

"We cannot part with this property for the bids that have come in," he said. "Selling this property for $18 million is sort of like losing a really good baseball player in free agency: it's not costing you anything but you are losing valuable property for nothing."

But Theresa Castellano and Richard Del Boccio - both of whom served on an advisory committee that came up with recommendations for the site - said the city should accept the higher bid and move on.

"Developers did not have enough time to get their ducks in order," Castellano said. "The bids went out late, real estate values are dropping, and Schoor De Palma, who was hired to do the soil testing, that report didn't come back yet. Take it and let's keep this moving."

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