Details Of Eatontown's Tax Deal With Kushner Cos. Over Monmouth Mall

EATONTOWN, NJ — Earlier this week, Patch reported the borough of Eatontown will offer a payment in lieu of taxes (PILOT) tax exemption to developer Kushner Cos. for Monmouth Mall.

Mayor Anthony Talerico says the tax exemption is necessary to allow Kushner to tear down huge parts of the mall and turn it into luxury apartments.

At the Wednesday night Council meeting, terms of the PILOT were unveiled:

The mall currently pays Eatontown about $4.5 million a year in property taxes. Under the PILOT, Kushner will pay Eatontown $4.5 million the first two years, but it then drops to $4.1 million a year for the next 30 years.

Once the apartments — to be named "Monmouth Square" — open, Kushner will pay the town seven percent of the revenue from the apartments and 8-10 percent of the revenue from the remaining retail, according to Michael Hanley of NW Financial. This is in addition to the $4.1 million a year.

Eatontown hired Hanley as an independent consultant to the Kushner PILOT tax deal.

Hanley did say the PILOT payments will be less than what Kushner would pay Eatontown in traditional taxes.

But he strongly urged the Council to accept the PILOT.

"Laws exist for properties such as this," said Hanley Wednesday night. "You have a property with an asset (the mall) whose value has plummeted. It was once something that was very valuable and is now no longer very valuable. Laws like this exist in order to generate new revenue and protect the taxpayer. Inaction (on approving the PILOT) would produce the loss of tens of millions of dollars. Action will turn an unproductive asset into a productive asset, and create a development that is desirable in today's marketplace."

Kushner Cos. is owned by Charles Kushner, the father of former President Trump's son-in-law Jared Kushner. Kushner is the developer and owner of Pier Village in Long Branch. The elder Kushner was also convicted in 2005 of illegal campaign contributions, tax evasion and witness tampering, under prosecution from then-U.S. Attorney Chris Christie. Kushner spent time in prison, but was pardoned by President Trump in 2020.

Monmouth Mall a "ghost mall"

Kushner wants to tear down the entire second floor of the mall and convert into a 1,000-unit apartment complex, a project they say will cost them $500 million. Monmouth Mall has become a "ghost mall;" about 500,000 square feet of stores are currently empty, according to the developer.

PILOTS are often controversial in New Jersey because they do not function like traditional taxes: 95 percent of the PILOT will go directly to the town of Eatontown; only five percent goes to Monmouth County. None goes to schools.

Yet some residents say they are specifically concerned the 1,000 new apartments will result in children that will crowd Eatontown public schools.

The Eatontown school district will request from the town their share of PILOT tax dollars.

If PILOT is approved, Kushner promises to drop millions of dollars in tax appeals

In exchange for getting the PILOT, Kushner Cos. agreed to drop several million dollars' worth of tax appeals they filed against the town of Eatontown over the past six years.

Kushner says it has overpaid millions in property taxes, as the value of Monmouth Mall has plummeted. Mayor Talerico warned Patch earlier this week he thinks Kushner will be successful in court on several of its tax appeals — which would "put the borough at tremendous risk."

"If they are successful in court — even some of them — it puts the borough at tremendous risk financially," said Talerico Wednesday. "It is a fact that the value of the mall property has decreased. And it is a large property in town."

The Eatontown town Council voted 6-0 to approve introduction of the PILOT. Talerico said the PILOT is the best way to allow Kushner to move forward with the apartments.

"They're not able to build this plan without the PILOT," said the mayor.

Eatontown already declared the Monmouth Mall property at the intersection of Rts. 35/36 an area in need of redevelopment.

The first public hearing on the PILOT will be Aug. 23, the regular Eatontown council meeting at borough hall. The public can speak on it at that time.

1,000 apartments, Whole Foods coming to Monmouth Mall

Kushner envisions 1,000 one- and two-bedroom apartments, with open-air pedestrian plazas, a center green and bike pathways around the perimeter. Kushner says they will build a pool, a gym and keep some ground-floor retail of the mall. Kushner said last summer they hope to entice a grocery store to open. In May, the Asbury Park Press reported it will be a Whole Foods, which will move into the space currently occupied by Barnes & Noble. The Whole Foods will open in 2026. The Barnes & Noble will remain open and relocate elsewhere on the mall property.

Eatontown Will Propose A Tax Deal For Monmouth Mall Owner Kushner Cos. (Aug. 9, 2023)

First Look At Kushner's Plan For 1,000 Apts. At Monmouth Mall (Aug. 2022)