A new slate of business incentives has state officials hoping they've charted a course to the economic promised land. If that's true, then someone has to be the navigator.
That's largely why real estate and service firms around New Jersey are moving quickly to raise their expertise in the subsidy programs, especially as they become available to a wider swath of businesses.
Just ask Tim Greiner of Newmark Grubb Knight Frank.
"We're spending a lot of time educating prospective clients that come through— and making sure our own office understands the models as well as anyone in the marketplace," said Greiner, an executive managing director with the brokerage firm.
He added that with a thorough, often time-consuming application process, "it's a much trickier job these days than just running around a 10,000-(square)-foot tenant."
Firms such as Newmark are not alone in trying to become de facto consultants on the new programs, along with their traditional roles. It's a need that stands to grow after passage of the Economic Opportunity Act, which streamlined the programs the state uses to incentivize business growth and development, while expanding their eligibility.
The law came amid great demand for the new Grow New Jersey tax credit and the Economic Redevelopment and Growth grant. Applying for the tax breaks can be painstaking, but the Economic Development Authority received nearly 20 submissions during the week of Nov. 18, the first week it accepted them.
It will no doubt be a busy time for a handful of New Jersey firms and professionals who already specialize in consulting on incentives. But insiders say there's no such thing as too much expertise these days — especially for programs whose regulations are nearly 90 pages — and it certainly can't hurt to grow that service from within.
"It's a complex piece of legislation," said Dan Breen, who heads Jones Lang LaSalle's business and economic incentives group in the Northeast. "It's going to be challenging in terms of understanding all of the nooks and crannies of the legislation, but I think at the end of the day, there are a lot of opportunities."
Breen, who has a background in accounting and tax law, joined the brokerage firm in mid-October and is based in New Jersey. His group is expected to focus on the New York metropolitan region with an emphasis on the Garden State, counseling clients on everything from determining if they're eligible to long-term compliance after they receive an award.
For companies that already have established niches in the area, it's been possible because of how infrequently businesses pull up their stakes.
"Like any specialized field, the client companies don't need these services very often," said Jay Biggins, whose Princeton-based firm, Biggins, Lacy, Shapiro & Co., advises on site selection and incentives. "So there would be very little reason for a large company to become experts in the incentives of the 50 states when in fact they only undertake projects that are (worthy of incentives) from time to time."
Biggins, the firm's executive managing director, noted incentives are just one factor and often come near the end of the site-selection process. But he said the need for experts in the field is on the rise — if only slightly, for now — as states such as New Jersey continue to refine their programs.
Still, developers, brokers and other professionals say the subsidies make up an increasingly larger piece of the process in real estate decisions.
That drove C&K Properties, the owner of Newark's 2 Gateway Center, to establish an "incentives concierge" program led by Sills Cummis & Gross attorney Ted Zangari, who helped rewrite the state's incentives programs; the service is designed to help tenants determine their eligibility as C&K works to lease space at the 18-story building.
"It's really critical that you have somebody who understands this because there are so many layers and so many angles to it," said Kevin Collins, C&K's managing director for asset management and finance. He added that "the information that gets presented to EDA significantly impacts the amount of money (awarded), so you need somebody … who really understands all of those nuances, to ensure that the tenant gets everything that they're really qualified for."
Meantime, professional service firms are making sure their own specialists are up to snuff — and that others know they have the expertise. In October, law firm Genova Burns Giantomasi Webster hosted a seminar on the Economic Opportunity Act in Jersey City, giving an overview of the new programs to nearly 100 professionals from across real estate.
George Garcia, the counsel of the Newark firm's land use and approvals group, said being well-versed in the field is integral to remaining a "cradle-to-the-grave" real estate practice. The know-how is even more critical because of the newly expanded eligibility for incentives, but also because some of the programs have statutory funding limits.
"It's very important to stay focused on it because it's going to be a very competitive process," Garcia said.
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