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The road to Union: It took time for Russo to clear the path for development of the former Merck site in Union Township

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Russo Development broke ground on Oct. 10 for the first phase of Vermella Union on the former Merck site on Morris Avenue in Union Township. From left to right: Richard G. Berger, Esq. general counsel, Russo Development; Manuel Figueiredo, Committeeman, Twp. of Union; Clifton People Jr., Committeeman, Twp. of Union; Joseph Florio, deputy mayor, Twp. of Union; Suzette Cavadas, mayor, Twp. of Union; Edward Russo, CEO, Russo Development; Michele Delisfort, Committeewoman, Twp. of Union; Dr. Dawood Farahi, president, Kean University.
Russo Development broke ground on Oct. 10 for the first phase of Vermella Union on the former Merck site on Morris Avenue in Union Township. From left to right: Richard G. Berger, Esq. general counsel, Russo Development; Manuel Figueiredo, Committeeman, Twp. of Union; Clifton People Jr., Committeeman, Twp. of Union; Joseph Florio, deputy mayor, Twp. of Union; Suzette Cavadas, mayor, Twp. of Union; Edward Russo, CEO, Russo Development; Michele Delisfort, Committeewoman, Twp. of Union; Dr. Dawood Farahi, president, Kean University. - ()

When Russo Development first sought to purchase the 55-acre site across the street from Kean University in 2014, the school balked, claiming it had secured right of first refusal on a portion of the land stemming from 1986 when the Kean family trustees passed partial ownership of the site to the pharmaceutical firm Schering-Plough Corp.

Schering-Plough later merged with Merck, and the school had been in talks with Merck about the use of the site. The dispute over rights brought the parties to New Jersey Superior Court, where after nearly a year of litigation, Judge Katherine Dupuis granted summary judgment to Russo. The judge agreed with Russo that there was no written conveyance transferring the right of first refusal from the Kean trust to its beneficiary John Kean, which is required under the New Jersey Statute of Frauds. John Kean had attempted to assign the rights to the university’s board of trustees in 2014.  The judge found the family trust expired in 1997, along with the right of first refusal.

 

The litigation also ensnared the Township of Union, which was reported to be concerned about the loss of taxes if the university acquired the site.

Though the parties fought hard, they put the litigation behind them and this summer, Russo entered into an agreement with Union and Kean University to sell 13 acres to the university to complete its purchase.

And two weeks ago the developer hosted a groundbreaking ceremony on phase I of Vermella Union, a project expected to deliver 1,264 rentals at the site, located on US Route 82 and within walking distance of the Union Train Station and near the Garden State Parkway.

“Vermella Union is the result of more than three years of collaboration with Union Township on the planning and design of one of the largest mixed-use developments in northern New Jersey during the next decade,” said Edward Russo, CEO of Russo Development. “Union Township had the vision to adopt a thoughtful redevelopment plan that was needed to allow the transformation of this unique site into a first-class destination that will complement Kean University and the surrounding community.”

The developer said the first phase of the project will deliver 462 luxury rental units and 40,000 square feet of retail to the town by the end of 2019.

Union Mayor Suzette Cavadas said, “To be able to take a mostly vacant former pharmaceutical site and get it cleaned up environmentally and developed into an outstanding residential community is amazing. Vermella Union will be a great addition to Union and the most significant redevelopment project in our community for many years.”

The developer has high hopes for Vermella Union because of its proximity to the train station and its adjacency to Kean University along Morris Avenue.

Russo Development pointed to the 42 acres site’s frontage on a state highway, its proximity to the Garden State Parkway, New Jersey Turnpike and Route 22; and its access to the trains and a university with 16,000 students. “These attributes coupled with the site’s location in a densely populated, suburban town provided the opportunity to create a vibrant community that does not exist in this market,” the company said in a statement.

Still, Russo still has plenty of work left before beginning construction.

Vertical construction is set to begin in Spring 2018 due to infrastructure and demolition requirements.

The company said it is demolishing 23 existing buildings with approximately 1 million square feet of floor area. The balance of the site will be developed in phases over the next eight to ten years and environmental remediation within the first phase has been completed, the company said.

Russo said it could seek to begin construction on the second phase of Vermella Union in the next 18 months, but constraints such as additional remediation requirements and the general state of the market may prompt it to stabilize the first phase before moving forward.

Despite the legal challenges having set the developer back for a few years, and demolition and remediation requirements for the site, Russo said it is confident Vermella Union’s location and uniqueness in the Township of Union will allow the community to thrive.

“We recognize the pipeline of multifamily development throughout the market and we have implemented a strategy that we believe will position us well for the future,” the company said.

“A site in a great community like Union Township that is adjacent to a leading educational institution like Kean University is always going to have appeal,” Russo said.

Russo Development is also working to complete Vermella West, a 280-unit apartment complex in Kearny, a 112-unit rental complex in Verona and a 300-unit, 18,000-square-foot mixed-use project in Garwood.

The road to UnionIt took time for Russo to clear the path for developmentof the former Merck sitein Union TownshipBy Mario Marroquin When Russo Development first sought to purchase the 55-acre site across the street from Kean University in 2014, the school balked, claiming it had secured right of first refusal on a portion of the land stemming from 1986 when the Kean family trustees passed partial ownership of the site to the pharmaceutical firm Schering-Plough Corp.Schering-Plough later merged with Merck, and the school had been in talks with Merck about the use of the site. The dispute over rights brought the parties to New Jersey Superior Court, where after nearly a year of litigation, Judge Katherine Dupuis granted summary judgment to Russo. The judge agreed with Russo that there was no written conveyance transferring the right of first refusal from the Kean trust to its beneficiary John Kean, which is required under the New Jersey Statute of Frauds. John Kean had attempted to assign the rights to the university’s board of trustees in 2014.  The judge found the family trust expired in 1997, along with the right of first refusal. The litigation also ensnared the Township of Union, which was reported to be concerned about the loss of taxes if the university acquired the site. Though the parties fought hard, they put the litigation behind them and this summer, Russo entered into an agreement with Union and Kean University to sell 13 acres to the university to complete its purchase.And two weeks ago the developer hosted a groundbreaking ceremony on phase I of Vermella Union, a project expected to deliver 1,264 rentals at the site, located on US Route 82 and within walking distance of the Union Train Station and near the Garden State Parkway.“Vermella Union is the result of more than three years of collaboration with Union Township on the planning and design of one of the largest mixed-use developments in northern New Jersey during the next decade,” said Edward Russo, CEO of Russo Development. “Union Township had the vision to adopt a thoughtful redevelopment plan that was needed to allow the transformation of this unique site into a first-class destination that will complement Kean University and the surrounding community.”The developer said the first phase of the project will deliver 462 luxury rental units and 40,000 square feet of retail to the town by the end of 2019.Union Mayor Suzette Cavadas said, “To be able to take a mostly vacant former pharmaceutical site and get it cleaned up environmentally and developed into an outstanding residential community is amazing. Vermella Union will be a great addition to Union and the most significant redevelopment project in our community for many years.”The developer has high hopes for Vermella Union because of its proximity to the train station and its adjacency to Kean University along Morris Avenue.Russo Development pointed to the 42 acres site’s frontage on a state highway, its proximity to the Garden State Parkway, New Jersey Turnpike and Route 22; and its access to the trains and a university with 16,000 students. “These attributes coupled with the site’s location in a densely populated, suburban town provided the opportunity to create a vibrant community that does not exist in this market,” the company said in a statement. Still, Russo still has plenty of work left before beginning construction. Vertical construction is set to begin in Spring 2018 due to infrastructure and demolition requirements.The company said it is demolishing 23 existing buildings with approximately 1 million square feet of floor area. The balance of the site will be developed in phases over the next eight to ten years and environmental remediation within the first phase has been completed, the company said. Russo said it could seek to begin construction on the second phase of Vermella Union in the next 18 months, but constraints such as additional remediation requirements and the general state of the market may prompt it to stabilize the first phase before moving forward.Despite the legal challenges having set the developer back for a few years, and demolition and remediation requirements for the site, Russo said it is confident Vermella Union’s location and uniqueness in the Township of Union will allow the community to thrive.“We recognize the pipeline of multifamily development throughout the market and we have implemented a strategy that we believe will position us well for the future,” the company said.“A site in a great community like Union Township that is adjacent to a leading educational institution like Kean University is always going to have appeal,” Russo said.Russo Development is also working to complete Vermella West, a 280-unit apartment complex in Kearny, a 112-unit rental complex in Verona and a 300-unit, 18,000-square-foot mixed-use project in Garwood. Email to: mmarroquin@njbiz.comOn Twitter: @Mars3Vega

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Mario Marroquin

Mario Marroquin


Mario Marroquin covers real estate. A native of El Salvador, Mario is bilingual in English and Spanish. He graduated from Penn State University and worked in Pennsylvania before moving to New Jersey. His email is mariom@njbiz.com.

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