NJEDA Announces Additional $75M for Commercial Real Estate Projects
July 29, 2021
The New Jersey Economic Development Authority (NJEDA) announced a $ 75 million extension of the commercial component of the Economic Redevelopment and Growth (ERG) program. The agency also announced that the expanded Residential ERG program, which began accepting applications in June, has increased from $ 50 million to $ 125 million. Further information on the ERG program can be found at https://www.njeda.com/erg.
“With the foresight of Governor Phil Murphy and the Legislature in reopening the ERG program, substantial commercial and residential projects across New Jersey can move forward while the new programs created by the Economic Recovery Act are in development.” said NJEDA CEO Tim Sullivan. “These programs will fuel economic growth and attract new businesses and workers to New Jersey. This is always important, but it is especially important now as we recover from the economic impact of COVID-19. “
The ERG commercial program is an incentive to help developers and businesses fill project funding gaps in development or refurbishment projects, including below market development margins or returns. Qualified projects can be reimbursed up to 30 percent of the total eligible project costs. Projects in Atlantic City, Camden, Paterson, Passaic and Trenton can be reimbursed up to 40 percent of the eligible project costs. The grants granted under the ERG program are not intended to replace conventional debt and equity financing. Before submitting an application, applicants must determine or have the balance of their funding or be able to demonstrate that the terms of any other funding are appropriate.
The new phase of the ERG commercial program is subject to the existing ERG regulations and statutes, as amended by the New Jersey Economic Recovery Act of 2020 (ERA) (L. 2021, c. 156) and subsequently by L. 2021, c. 160. Projects must include:
- Predominantly commercial, comprising 100,000 or more square feet of retail, office, and / or industrial use for sale or rent.
- are in a qualifying incentive area.
- Before submitting an application, construction started on the site of a planned refurbishment project or demonstrated to NJEDA that the project would otherwise not be completed or that it would be carried out in phases.
- Show that there is a project funding gap.
- Show that the tax revenue that the state will generate from the project is higher than the incentive provided.
For complete information on eligibility for the ERG Extended Commercial Program, please visit https://www.njeda.com/erg.
NJEDA will start accepting applications for the expanded commercial ERG program starting Monday, August 16, 2021 at 12:00 PM EDT. All applicants must submit an application via NJEDA’s online application at https://application.njeda.com /. Applications will be accepted on a first come, first served basis until funds are used up or by Thursday, December 30th. Further information on the application process can be found at https://www.njeda.com/erg.
Potential applicants can send questions about the ERG commercial program and application to [email protected] until 11:59 p.m. EDT on Sunday, August 8, 2021. Answers to these questions are posted in a Frequently Asked Questions (FAQ) section on https: //www.njeda.com/erg.
In addition to the expanded ERG program, ERA is creating and expanding a number of programs that include tax credits to incentivize job creation, new construction and revitalization of brownfields and historic properties; financial resources for small businesses; Support for new supermarkets and healthy food retailers in communities in the food desert; new funding opportunities for startups in New Jersey; and support for the growing film and digital media industry. NJEDA will continue to involve the public as new programs and rules are developed. More information can be found at https://www.njeda.com/economicrecoveryact/.
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