The New Jersey Economic Development Authority (NJEDA) recently approved Sills Cummis client Meadowlands Logistics Center LLC to receive the first Aspire tax credit incentive awarded to an industrial warehouse project. The project owner will receive an award of up to 50 percent of the total project cost, not to exceed $56.5 million for the development of a modern warehouse facility in Secaucus. The warehouse, which will be located on the last large tract of undeveloped land in the Meadowlands, will measure 775,000 square feet and include a 40-foot clear ceiling height, 232 trailer parking spaces, 96 loading docks with capacity for an additional 89 docks if needed, four drive-in entrances, 570 parking spaces, and integrated office space. Planned uses for the development include warehouse operations, light industrial manufacturing, logistics and distribution, cold storage, import and export port services, e-commerce fulfillment, and a data center. The project will also include community amenities such as a public walking trail, a scenic overlook with dedicated parking, expanded sidewalks, and a bus shelter to enhance accessibility.

Gov. Phil Murphy today signed into law a bill establishing the “Next New Jersey” tax credit incentive program for manufacturing businesses creating at least 20 new full-time jobs and making a capital investment of at least $10 million at a New Jersey facility. The award amount to an eligible business will be equal to the lesser of: (1) 0.1 percent of the eligible business’s total capital investment, multiplied by the number of new full-time jobs; (2) 25 percent of the eligible business’s total capital investment; or (3) $150 million, and the New Jersey Economic Development Authority (“EDA”) is authorized to also issue “bonus credit awards.”

Late last night Governor Murphy signed legislation into law requiring the State Treasury to buy back developers’ unused tax credits under the NJEDA’s Aspire, Film & Digital Media Tax Credit, and CAFE incentive programs. Under this new law, a tax credit recipient under any of these three programs has the absolute right to redeem unused tax credits to the State Treasury for cash if those credits remain unsold for longer than one year after their date of issuance. Although most developers have been able to sell their tax credits in the private markets (typically above 90 cents on the dollar), this new requirement will provide a much-needed backstop; banks contemplating making a bridge loan or construction loan against tax credit awards issued under any of these programs will now be assured that the tax credits can ultimately be monetized at the State Treasury and that they will be purchased at a certain price (85 cents for Aspire and CAFE tax credits, and at 95 cents for Film & Digital Media tax credits), thereby providing a reliable floor for budgeting purposes.