I provide a few tips on “How to Acquire Retail Space” in the Small Business section of the Chronicle.  For the full article, please click here.

What are your tips on acquiring retail space?

NJ BIZ reports: increased leasing activity in less-desirable buildings is bright spot in the first quarter of 2012.  While vacancies in New Jersey’s class A office properties rise,  less desirable buildings may be foundation of  the real estate industry’s recovery.

Report: Leasing activity at less-desirable buildings driving office rebound

On April 10, the New Jersey Economic Development Authority board approved a total of $110 million in tax credits under the new Grow New Jersey Assistance Program, signed into law in January with support from NAIOPNJ, which targets businesses that are both investing money in the state and adding or retaining 100 jobs. “Here we are three months later, and we have four great projects,” said EDA CEO Caren Franzini, noting the recipients are committed to remaining in the state for 15 years, five years more than the time period in which they receive the tax credits. Like other large incentive programs, companies only receive the tax credits once they have opened their facilities, she said.

The EDA board also agreed to issue bonds on behalf of a company, to be selected by the Port Authority of New York and New Jersey, to build a replacement to the Goethals Bridge.  At an estimated cost of $1.56 billion. The approval was needed as part of the authority’s application to the U.S. Department of Transportation for funding for the project.

It is not unusual for me to get a call from a commercial landlord battling with a tenant who is in arrears asking whether it is OK to accept a check from the tenant for less than the rent that is owed. Typical of most answers in the law, I tell them it depends. Initially, it is important to distinguish between “receipt” of rent and “acceptance” of rent. If a tenant simply mails in a check to the landlord, who holds it or brings it to court then that check will be deemed as only having been received by the landlord – not accepted. The reasons underlying this distinction are clear – any tenant behind on rent or otherwise in default of the lease could get out from under the default by simply mailing a check to the landlord. A landlord’s mere receipt of rent should have no impact on the status of the tenant’s default.

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A-1023, advanced by the Assembly Labor Committee, requires that all payments by an owner of a project be kept in a trust fund until all of the contractors and subcontractors have been paid. Officers of corporations that misuse these funds can be held personally liable. Representative of general contractors say the right of subcontractors to hold liens against project owners guarantees their payment. Meanwhile, reps for subcontractors say the lien rights are worthless if a general contractor pockets money that the subcontractor is due.

Subcontractors, general contractors part ways over payment bill

Senators Ray Lesniak and Barbara Buono have introduced legislation (S-1566) to transform foreclosed homes into affordable housing.  The bill would create the New Jersey Foreclosure Relief Corporation and would allow municipalities to buy foreclosed houses through the state’s $268 million affordable housing trust fund, and thereby earn two-for-one credit toward their affordable housing obligations.  If municipalities decide not to buy the vacant homes, the Corporation would be able to purchase them through federal and state financing sources and deed restrict them as affordable housing for three decades.  The corporation could also issue bonds to buy and sell vacant foreclosed houses with the goal of selling them at market rates.   Assemblyman Jerry Green is expected to introduce the Assembly version of the measure, which Lesniak says will create more than 10,000 new affordable homes: “It does not address the ongoing complex, incomprehensible and so far insolvable obligations of municipalities, but it will make those obligations more readily attainable,” he said.  S-1566 was released unanimously by the Senate Economic Growth Committee on Thursday.

New Jersey Business Magazine reports:  According to year-end statistics for the U.S. industrial market recently released by commercial real estate services firm Cushman & Wakefield, Inc., industrial leasing is up by 83.2 percent, nearly 23.4 million square feet of new industrial leases in Northern and Central New Jersey in 2011, compared to 12.8 million square feet in 2010.  The highest volume since before the recession.  As a result, the overall vacancy rate was down 1.6 percentage points from 2010, coming in at 9.6 percent.  New Jersey’s progress mirrors strong performance nationwide.

In Fifth Roc Jersey Associates, L.L.C. v. Town of Morristown, Fifth Roc, the owner of the Morristown Hyatt, represented by my colleagues Carl Weisenfeld and Nick Pellitta, successfully challenged an $8 million “added assessment” by the Town of Morristown on its property for 2009,  under the “Freeze Act,” N.J.S.A. 54:51A-8, which provides:

Where a judgment not subject to further appeal has been rendered by the Tax Court involving real property, the judgment shall be conclusive and binding upon the municipal assessor and the taxing district, parties to the proceeding, for the assessment year and for the two assessment years succeeding the assessment year covered by the final judgment, except as to changes in the value of the property occurring after the assessment date.

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New Jersey Business Magazine reports: According to Third Quarter 2011 New Jersey Office MarketView Report by CB Richard Ellis, the leasing velocity in central New Jersey is leading the state and positively contributing to the rebound of its office market, continuing the trend for the year.  In total, the state  leased 862,102 sq. ft., with central New Jersey accounting for 850,626 sq. ft. of positive absorption and northern New Jersey only 11,476 sq. ft.   Renewals accounted for 39.1% of overall activity in the quarter; 41.3% year-to-date. Almost 75% of leasing velocity was Class A properties, as tenant seek to capitalize on current market conditions and secure high-quality space.

CBRE Report: Central New Jersey Office Market Leads Current Rebound

In an unpublished decision, issued on November 7, 2011, by New Jersey’s Appellate Division, the importance of drafting a notice to quit in accordance with the law is highlighted.  In Sanguiliano v. Walker, 27-2-4205 App. Div., Plaintiff’s summary dispossession action was based on her alleged disorderly conduct and violations of the landlord’s rules and regulations.  The dispossession action was governed by the requirements of the Anti-Eviction Act.  According to the Appellate Division, the “notice to quit” did not identify any “continued” disorderly conduct or violation of the landlord’s rules and regulations committed by defendant after her initial receipt of the “notice to cease.”  Because the notice to quit was defective, the Appellate Division ruled the trial court should have granted defendant’s motion to vacate the default judgment for possession and dismissed plaintiff’s complaint.  It reversed the judgment for possession.

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