Bayonne issued similar redevelopment area bond agreements

The film studio touted as one of the biggest ever commercial investments in Bayonne history may also receive a rare incentive from the city: millions of dollars in city bonds. As a part of a negotiated deal with the developer Togus Urban Renewal, the city is considering issuing $65 million in bonds to the 1888 Studios project that would bring a film studio to the former Texaco property near the Bayonne Bridge.

While the city frequently offers developers incentives in the form of payment in lieu of taxes (PILOT) agreements, it hasn’t offered redevelopment area bonds for a commercial project since 2015.

So why is Bayonne planning to do so this time around?

In part, because of just how unusual, and in the administration’s eyes, exciting, the project is for the peninsula city. The $900 million project will transform a long vacant oil refinery into a studio expected to host up to 3,000 full-time employees once complete.

“This specific commercial project is going to generate several thousand jobs, and it will be the largest project in the city of Bayonne to date,” said Bayonne Law Director Jay Coffey when explaining the reasoning for the bonding.

Revenue from filmmaking in New Jersey exceeded $500 million last year for the first time. The state recently increased tax credits for digital media projects from a $10 million to $30 million limit.

Bayonne also has carefully weighed the risks and rewards and feels that a couple of security measures in place for the deal significantly lower the risk factor if the project falls through, Coffey said.

One of the security measures is a $65 million letter of credit, a guarantee that if the developer itself doesn’t make the annual bond repayments a financial institution will do so on its behalf.

The second is a deed in lieu of foreclosure, which would allow the city to take the property that Chevron sold for $33 million in 2020 if there is a default in the payments.

“We’re doubly secured,” Coffey said.

The law director said there have been a “tremendous amount” of negotiations surrounding the project, with the bond being one of the negotiated points.

It will require an application to the Local Finance Board and City Council approval. So far, it has not even been introduced at the City Council for transfer to the finance board.

The project will also have a 30-year PILOT agreement in which Togus will pay the city $130 million.

Bayonne issued similar redevelopment area bond agreements for the Prince Royal Corp. development and the Bayonne Crossing shopping center. The city approved $17.5 million in bonds for the wine wholesaler warehouse on Lefante Way in 2013, and they were issued in 2015, Coffey said.

Bayonne Crossing’s bond agreement was for $23 million in 2009.

The 17-building studio will occupy most of the 58-acre lot that was previously a Texaco refinery. Construction is expected to begin early next year.

It is just one of several projects that are expected to transform former industrial sites on Bayonne’s Newark Bay waterfront into commercial and residential hubs with a public waterfront walkway.

A shooter opened fire in a gay nightclub late Saturday, killing five people and wounding 18 in the latest mass shooting to befall the country in a year in which anti-gay rhetoric has been amped up among extremists.

Lt. Pamela Castro of the Colorado Springs Police Department said police received a report of a shooting at Club Q at 11:57 p.m.

Castro said there was one suspect who was injured and was being treated. She said it was not immediately clear whether the attacker had been shot by officers. She said the FBI was on the scene and assisting in the case.

The police department tweeted that it planned an 8 a.m. news conference at its operations center.

Club Q is a gay and lesbian nightclub that features a “Drag Diva Drag Show” on Saturdays, according to its website.

In addition to the drag show publicized on the website, Club Q’s Facebook page said the night’s planned entertainment included a “punk and alternative show” preceding a birthday dance party, with an “all ages brunch” scheduled to begin at noon on Sunday.

Exit mobile version