Nutley, Developer Butt Heads Over Future Of Ex-Roche Property

NUTLEY, NJ — A battle is brewing between Nutley and a North Jersey development firm. And the fate of one of the town’s most prominent pieces of real estate is at stake: the former home of Hoffmann-La Roche on Route 3.

Now known as ON3, the property has gained a new life since the pharmaceutical company left its former headquarters, which is located on the border of Nutley and Clifton. Over the past several years, its new owner – Prism Capital Partners – has been redeveloping the 116-acre complex, which is now home to tenants that include Ralph Lauren and the Hackensack-Meridian School of Medicine at Seton Hall University.

In the past, Nutley officials have expressed high hopes for Prism’s redevelopment plan. But after years of waiting for the campus to build out, the town has run out of patience, officials said Monday. And now, they’re looking into possibly taking back unused portions of the property through eminent domain.

The standoff with Nutley is the second real estate clash that Prism has found itself embroiled in over the past year in Essex County.

In September, West Orange officials announced that the town has reached a settlement with the company over a massive redevelopment plan dubbed Edison Village. Declaring Prism to be "in default" of the redevelopment agreement, the township terminated the deal in June. The firm later launched a lawsuit to stop the process and restore its rights as exclusive developer for the project.

• See related article: West Orange, Prism Reach Deal To End Real Estate Standoff

NUTLEY OFFICIALS: ‘REBUFFED AT EVERY TURN’

On Thursday, Nutley town commissioners approved a resolution that will probe the possibility of seizing some of the property via eminent domain.

According to a statement from town officials, the resolution authorizes commencement of the condemnation process for the property in the Roche redevelopment area which is not subject to Prism’s already enacted redevelopment plans, including the Seton Hall-Hackensack Meridian Graduate School of Medicine, Modern Meadow, Ralph Lauren, the soon-to-be occupied Eisai Pharmaceuticals building and a new parking deck.

Nutley officials gave some background about the project in a news release:

“The proposed area was declared a condemnation site in need of redevelopment in 2015, in order to enable Nutley to control its destiny and ensure the redevelopment was done in a manner that would benefit the township and its citizens. The current owner of the property, Prism Capital Partners, purchased the area with the knowledge that it was in need of redevelopment on a condemnation basis, and with knowledge that Nutley had condemnation power over the property.”

But now, after several years of successful negotiations, relations between the town and the developer have come to an impasse, Nutley officials said.

“As our residents know, the commissioners have been attempting to work with Prism for several years, trying to agree on a comprehensive redevelopment plan for the property,” Nutley Mayor Mauro Tucci said.

“In the beginning, we were able to work cooperatively with Prism on certain matters such as the financial agreements for the medical school, Ralph Lauren, Modern Meadow and the building soon to be occupied by Eisai Pharmaceuticals, including the parking deck that services those buildings,” Tucci said. “When requested by the developer, we expedited decisions to help him move these projects forward quickly.”

“Unfortunately, our efforts to work with Prism regarding the balance of the Roche site have not been successful,” the mayor added.

“Rather than develop a comprehensive plan for the entire site, which would enable Nutley to understand the depth of the impact to be felt by Nutley residents, Prism has instead elected to move forward with piecemeal development which will have a devastating traffic impact on our streets, and stands to change the nature of this area of Nutley,” Tucci said.

“When asked to address our traffic concerns and to work with us on solutions, we have been rebuffed at every turn,” Tucci said.

Nutley officials are hopeful that Thursday’s approved resolution will act to accelerate the process of making the former Roche site an “enhancing, tax generating asset for the town,” Tucci said.

“This property is too significant not to get it right,” Tucci asserted. “What gets developed in and around this site will shape Nutley’s future for generations to come.”

• See related article: Nutley Apartments Sell For $19M; Revamped Ex-Roche Site Aids Sale
• See related article: Nutley Chamber Trying To Funnel ON3 Workers To Local Businesses

PRISM PARTNERS: ‘LIES AND FALSEHOODS’

On Tuesday, Eugene Diaz, a principal partner at Prism, fired back at the town’s accusations, calling them “lies and falsehoods.”

Diaz offered the following statement to Patch:

“We read with shock and disbelief the statements made by the township commissioners announcing an intent to acquire the remaining portions of the ON3 campus via the exercise of eminent domain. The commissioners continue to spread lies and falsehoods to cover up their own mismanagement of the single greatest economic development opportunity in Nutley for the past 50 years.

“The commissioners have not attempted to work with Prism. In fact, the commissioners have refused to meet with Prism for the past two years. Instead, the commissioners have spent more than $1 million of taxpayer money working with consultants that have produced absolutely nothing of value for the future of Nutley. The commissioners hide copies of studies that they refuse to disclose to Prism. Rather than engage in planning for the future of Nutley, the commissioners spend tax dollars on lawyers who have put forth challenges to every new development proposed in either Nutley or Clifton.

“Citizens need to know that the commissioners already control the redevelopment of these parcels. Prism has presented plans for things like a desperately needed assisted living facility, and new laboratory and research buildings and affordable housing. We made commitments to make reasonable and necessary traffic improvements as shown in numerous traffic studies Prism has submitted to the township and the county with every application for development. In fact, Prism is undertaking more than $2 million of roadway improvements on Bloomfield Avenue, in connection with approvals granted by Clifton and Passaic County. The commissioners have refused to act on any of these plans, and they have put forth no alternatives whatsoever to create value from these vacant parcels or to further its development as a cohesive and unified campus that can benefit all.

“It is clear from their legal strategy and their own inaction in addressing redevelopment of this campus for the past six years, that the commissioner’s ideas of redevelopment are ‘no development.’ They’ve attempted to illegally close the internal campus roadway system, the result of which would have been to overburden Passaic Avenue and Bloomfield Avenue with even more traffic. The closure of Metro Boulevard was thwarted by the court, who ruled in Prism’s and Clifton’s favor that Nutley lacks jurisdiction to close intermunicipal roadways.

“Now, the commissioners want to buy the ON3 campus through eminent domain? Taxpayers need to understand that in order for the township to take this property, they have to float a bond worth tens of millions of dollars and raise taxes to pay for it. Nutley taxes went up 4.5% this past year. That’s the 20th highest increase of all 565 municipalities in New Jersey. Meanwhile, Clifton, who has not had any problem working with Prism by approving great job and tax ratable creating projects, were able to lower their taxes 0.33% this past year.

“One thing is correct in their statement, ‘this property is too significant not to get it right.’ Then why haven’t the commissioners put forth any ideas as to what they would like to see developed? It only took Prism 3.5 years to rebuild and repopulate the existing buildings in Nutley that were part of the prior Hoffmann-La Roche campus. Prism has attracted world class companies to Nutley.

“It doesn’t take six years to figure out what else can be built on the Prism property. We have provided numerous ideas to the commissioners, only to be met with silence. The taxpayers of Nutley cannot afford to have the Prism property remain vacant. Further, with 1,000 unemployed people in Nutley, it is vital that development move forward swiftly. The fault does not lie with Prism, but with the commissioners.”

• See related article: Ralph Lauren Arrives In Nutley, Opens Office At Ex-Roche Site
• See related article: $70M Medical School At Ex-Roche Site Earns 'Good Neighbor' Award

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