• Lee Roth

Redevelopment; How It Started Here


How It Started

It all started when Flemington Fur Company bought the Union Hotel. The idea was to tear it down. The Fur Company was one of three iconic businesses in town. They intended to have a clear Vista from Main Street to the Fur Company building. Only a few days after they owned it did the President realize he would never be allowed to tear down this building because of its historic importance.

Already owning the building, and not being in the restaurant business, he found operators who would rent the property. The lease included the liquor license. The tenant continued its operation as it had been operated for the few years before the Fur Company bought the property. Over the years a successor number of restaurant people entered into arrangements with the Fur Company and continued the operation.

Eventually management of the Fur Company decided that it did not want to continue the responsibility, did not want to face looming maintenance costs, and further decided that it would rather withdraw its capital from the property. An agreement was entered into with the then current tenants who managed and ran the restaurant. Somehow the Fur Company was allowed to retain an extremely long term lease on the parking portion of the property when they proceeded with the sale of the hotel and restaurant building.

The Fur Company Fenced Off The Parking

The Fur Company then fenced off the parking portion of the property for its own exclusive use. Why was it ever allowed to do that? It was allowed just because it was an important business in town. It eventually went before municipal boards and formalized the division of the parking from the hotel restaurant building.

The hotel restaurant was managed successfully for a time by the new owners. It brought in music, it organized events to attract customers, and it attempted some internal renovations. The owners and management began to develop some plans for changes and renovations. They were told they had insufficient parking and would need a variance that might be hard to obtain. Eventually they decided to abandon their expansion plans. After struggling a short while, management decided to close their operation. They sold their liquor license to a franchise restaurant that was opening in a new development on the edge of town.

Substantial Tax Money Was Spent On Legal Fees

Flemington government management realized that the loss of the bar and restaurant, a large dark building across the street from three large County buildings that were only partly occupied, could have a negative impact on activity in the center of town. They engaged the owners in litigation attempting to prevent the movement of the license from the center of town. As the license was being sold for $600,000, one speculating as to strategy, might suggest that the license could have been purchased for that amount and kept in town. Instead, substantial money was spent on legal fees in an unsuccessful effort to prevent the movement of the license to the new shopping area.

Executive Sessions = Secret Meetings

It is hard to know what the thinking and strategy was of the people who ran the government. Much of what they did was conducted in executive sessions. “Executive sessions” is another term for legally allowed secret meetings and sessions. We do not know where, but somewhere they got the thought that they could designate the hotel property as a redevelopment zone. If they did that they could have a “work around” from the current zoning laws and maybe solve the parking problem they saw that they had created by allowing the parking lot to be divided from the hotel property. They could also encourage a developer with favorable tax incentives.

The government advertised, seeking people or organizations that were interested in developing or redeveloping the hotel property. They received at least three initial proposals. One of them was from a successful local developer who has successfully renovated both the Flemington National Bank building on the corner and what is known as the "clock tower" building across the street on the same side of Main Street on the other corner. His proposal was to convert the upper floors of the hotel building into condominium residential units and the ground floor into a restaurant and bar facility. This proposal was rejected. Of the two remaining possible redevelopers the government leadership accepted one that involved a local restaurant owner, a planner, and a County resident who had some experience with development in Jersey City.

It is reported the Jersey City developer had a handshake agreement by which a marketing study would be created at a shared cost between himself and the government. He would use the study as part of a financing application. The government selected the consultant. It is disputed as to what happened, except that the result was that the study was delayed for a long time. The real estate market in Jersey City is reported to have decreased in value, and the selected redeveloper and the government agreed to part ways, or perhaps the Government terminated the agreement

The Government Did Not Verify Qualifications

A new redeveloper was sought. The government chose a new entity which was backed by the same restaurant owner and another County resident, a medical equipment salesman who claimed to have the resources, knowledge, and ability to carry forth with the project in place of the then discharged first redeveloper. The Government apparently did not verify the new developer’s representation as to his qualifications.

It turned out that the second redeveloper did not have near the required resources, or knowledge, or any experience. They borrowed money piecemeal from a County resident and were never able to demonstrate that they had the ability to carry forward with the project so as to be able to attract the financing that they counted on to proceed. In order to stall the timetable and get additional time, in their effort to find investors, they convinced the government that the project was too small and that the redevelopment area had to be expanded.

They presented no figures or budget to justify their conclusion, a conclusion the government accepted. The area was thus expanded to include four other properties along Main Street, including the historic bank proprty the government owned and wanted to get rid of. . After failed attempts to raise money the second redevelopment group put its limited liability company into bankruptcy and walked away from the project. They left the local County resident who loaned money to them to foreclose his mortgage on the hotel property. He now owns the historic Hotel.

High Character And Deep Pockets

No doubt exasperated by their lack of success, the government sought a third redeveloper. They found an accountant who had sold his Main Street property, merged his accounting firm with a bigger outfit, and moved to a highway location in the neighboring township. He was known to have been involved in what appeared to be a successful local baseball enterprise, a large health club, and a super market with a strip shopping center. Without any particular known investigation as to his experience with a project of this type and magnitude, the mayor and his supporters selected this man to be their third redeveloper.

The man started by bidding in the liquor license owned indirectly by the second failed redeveloper at their bankruptcy sale. With control of this asset he was selected as the third redeveloper, the mayor declaring that he was of "high character and deep pockets". That may be true. He formed a new limited liability company that signed a redeveloper agreement favorable to him. No other investigation is known to have been conducted of him or his new company.

The third redeveloper declared that the project ,as presented, was too small. He asked that the redevelopment area be expanded to include property of the mayor's friend who had been the leader of the Flemington Fur Company. Because of the scope of this proposed project, which initially involved tearing down almost all of the center historic buildings in town, and constructing a residence tower twice the height allowed by the just passed master plan, a group interested in preserving the historical aspects of Flemington was formed under the leadership of a resident and a business property owner.

Just as the Borough had engaged the hotel liquor license owner in litigation in an attempt, an unsuccessful attempt, to keep the license in town, this new group interested in preserving the historic aspects of town turned to the courts and engaged the government in litigation in an effort to preserve the lifestyle that they felt was important to Flemington.

In two successive years elections to the Flemington governing body slowly have been replacing candidates who favored the massive development backed by the mayor, with people more interested in historic preservation. The governing body now consists of a mayor who was an outspoken advocate of the massive redevelopment project, and three members of the governing body who support him in his mission, and three newly elected members of the governing body who wish to see the historic aspects of the town preserved. Votes are now tie leaving the Mayor to make the decision on any issues related to the project.

Lifestyle Of The People

The mayor and his supporters have used New Jersey laws designed to tear down and replace slums by declaring the property as “blighted” to obtain almost unlimited control over the designated redevelopment area. The newly elected members of the governing body, and the group organized as the Friends Of Historic Flemington , have attempted to slow down the process that would lead to the destruction of the historic aspect of town, so the voters can have an opportunity to express their voice as they have been doing for two years.

In six weeks we expect that an annual election will have a substantial impact on the lifestyle of the people, including the businesses and residents. The question to be decided is whether or not the small town historic lifestyle in Flemington will be preserved, or whether Flemington will step out in a totally new direction, throw aside most of the historic traditions that make Flemington Flemington, cease being a small town, and become an entirely different community.

We await the results of the election and the final results in the Court system.

#government #justice #EconomicDevelopment #Flemington

Copyright 2020 - Lee B. Roth  | 91 Main Street, Flemington, NJ 08822 

908.782.5317 | lbr@lawroth.com 

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