The transformation of one of downtown Newark's landmark buildings took a ceremonial step forward Monday, as developers and financing partners joined city officials to break ground on the $174 million restoration of the Hahne & Co. building.
The project, led by L+M Development Partners, calls for rehabilitating and converting the Hahne’s department store into 160 mixed-income housing units, 75,000 square feet of street-level retail space and a new arts and cultural center for Rutgers University. The retail portion includes a 30,000-square-foot Whole Foods, a high-profile tenant that’s expected to bring new traffic to Broad Street.
For Newark, the project will reactivate one of its most iconic structures as part of a surge in development around it. The development team is preserving key elements of the four-story, 400,000-square-foot building, including the façade, the original signage and the skylight.
Newark Mayor Ras Baraka highlighted the significance Monday as he joined L+M, which is working with local developers Hanini Group and Crawford Street Partners, and partners Prudential Financial Inc., Goldman Sachs and Citi for the groundbreaking ceremony.
“The Hahne’s Department Store is one of the legendary buildings of our historic downtown and today’s groundbreaking is another step in the transformation of Newark’s core,” Baraka said in a prepared statement. “For nearly three decades, this structure has stood vacant, but now it is becoming an integral and dynamic part of our efforts to transform Newark’s downtown into a 24/7 neighborhood.”
Jon Cortell, vice president of development at New York-based L+M, called it “a historic day for the city of Newark. Together with our myriad of partners, we are proud to finally bring the iconic Hahne’s building back to life as well as inject new jobs, housing, retail and learning opportunities into the heart of downtown Newark.”
The project comes amid a wave of other redevelopment in New Jersey’s largest city, including the recent renovation of Military Park and the construction of Prudential Financial’s new 20-story office tower nearby. And at 15 Washington St., Rutgers and New Brunswick Development Corp. are restoring the former American Insurance Co. headquarters to create student housing at the 22-story building.
The new Hahne’s building will also include the new home for the Rutgers University Department of Arts, Culture and Media, which will occupy about 50,000 square feet, according to a news release. The space will include a 250-seat auditorium-style classroom plus studio and gallery space for campus arts programs, while providing a new teaching and work environment for more than 60 Rutgers staff and faculty.
The renovation is being financed through a partnership among public, nonprofit and private groups, including $66 million from the New Jersey Housing & Mortgage Finance Agency and $40 million from the New Jersey Economic Development Authority, the news release said. The financing also includes $67 million of private equity and tax credit equity from Goldman Sachs as well as financing from Prudential Financial, Citi and sponsor equity.
The Hahne & Co. department store was designed by architect Goldwin Starrett and built by prominent local businessman Julius Hahne in 1901. Hahne’s was Newark’s first commercial building designed specifically as a department store.
The building has sat vacant since 1987, when Hahne’s was sold to May Department Stores Co., owner of Lord & Taylor.
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