LCOR Aims Its Hoboken Connect at Reactivating a Stretch of Jersey Waterfront

But shovels are finally in the ground for the preojct, dubbed Hoboken Connect, following the demolition of a former NJ Transit operations building at the corner of Hudson Place and Hudson Street, and the residential component will be under construction by October.

“It’s a great example of what we have become known for: a thoughtful, holistic and comprehensive approach to development that includes both private development as well as public infrastructure components,” Barry told Commercial Observer in April. 

In that span of almost 20 years, the project has taken on many faces depending on the challenges of any given year or years.

“So that period of time from ’05 to more recently, you had a series of macro events between the financial crisis to political changes of leadership continuing to evolve at the state and local levels to natural disasters such as Superstorm Sandy,’” Barry explained. “So the project itself has continued to be kind of reshaped, and evolved to meet what the market conditions are today in response to all of those factors.” 

LCOR partnered with NJ Transit and the City of Hoboken to bring the project to life, which in turn meant that Barry’s team will renovate the dilapidated, but once elegant, NJ Transit Hoboken Bus Terminal and turn a parking lot into a pedestrian plaza, adding a historic preservation angle to the project.

New Jersey Gov. Phil Murphy’s administration committed $176 million to the project in July 2022, which would cover the cost of the NJ Transit infrastructure improvements, but will not fund the residential building and the 700,000-square-foot office tower.

Besides that contribution and a $90 million tax credit for the residential component from the New Jersey Economic Development Authority, LCOR is funding the project themselves.

The private development sites are controlled by LCOR through a 98-year ground lease with New Jersey Transit, according to Barry.

LCOR is incorporating a digital twin-like experience to its pre-leasing of the office building.

“What we’ve done is create, with our head of marketing and tech, a pretty unique experience, breaking the mold of how buildings are leased historically,” Barry said. “So what we’ve done is create more of an immersive experience for each component of our pre-leasing office. So we have in collaboration with Pixel Artworks a 280-degree immersive experience center. … And then we have a leasing center that’s attached to it as well. It’s meant to be more interactive than what you would historically see.”

While office leasing has made slow improvements since the pandemic rendered in-person workspaces nearly obsolete four years ago, Barry believes LCOR will bring that component of the development online in a different market than it is in today considering that the firm hasn’t broken ground on it. (Delivery is at least five years away).

“When you look at the office market just more broadly, it was only three years ago that people were expected to be back in the office three to four days a week when everybody was supposedly going remote. Right? We’re in a very different place today,” Barry said. “So I think that that messaging and that narrative of how people work and who works where will continue to evolve.”

In Hoboken’s waterfront, Barry and his predecessors at LCOR have seen a wide expanse of untapped potential, despite being on what some would deem the wrong side of the Hudson River. In other words, Hoboken has all the features that make Manhattan a hot market yet is only a short commute away.

“What we’ve had the benefit of while there’s been a long duration for this project is that Manhattan’s West Side has been completely transformed from Hudson Yards down through Chelsea,” Barry said. “So what we have here is connectivity. In somewhere between 15 to 30 minutes, you can be from Hoboken to the West Side of Manhattan by bus, ferry or PATH train. It’s the only multimodal transportation hub in the system that has five modes of transportation with direct access to Manhattan. So you have that connectivity at a discount [compared] to where rents are today in New York.”

This has already been proved on other stretches of the Hoboken waterfront. But with the public realm improvements, LCOR plans to make an already logistically feasible location an attractive destination.

“This is arguably the last stretch of waterfront that hasn’t been redeveloped. When you look at the experiences from southern Hoboken to northern — restaurants, nightlife — you have all those experiences either a resident, commercial entity or tenant are looking for, and you’ll have all the infrastructure,” Barry said. “The state that it’s in today? It is not a desirable location. But all of those improvements, between what we’re proposing to build at the residential site as well as all the public infrastructure improvements, will completely transform this area.”

While Hoboken Connect is likely a safe bet with only the office component seeming like a bit of a gamble, Barry seems to have the experience to handle it, being no stranger to distress.

In his 25 years in the real estate industry, Barry spent time at Lehman Brothers, both pre- and post-bankruptcy.

“I’ve been in the capital market side, I’ve been in risk management, I’ve been in asset management,” Barry said. “The experiences that I had predating LCOR, I think it was unique in the sense — especially that post-bankruptcy period of what I was working on and what I was dealing with — to be able to transition into this on day one.”

LCOR is planning to deliver the full development within the next five to seven years.

“We think that when you set aside all the noise and look at a longer duration, it’ll sort itself out,” Barry said. “I think it’s probably still, I don’t know, 12 to 18 months away from what the new normal will look like. … [But] you have all of those attributes that New York offers from an urban existence experience.”

From Boston to Florida, LCOR has about 9,900 apartments under management and is in the process of delivering another 1,500. 

Some of the projects under construction by LCOR include 247 North Avenue in New Rochelle, N.Y., a 28-story mixed-use development with 307 units and 3,000 square feet of retail, and the newly completed 1515 Surf Avenue in Coney Island, Brooklyn, which is 27 stories and 463 units.

LCOR’s project development pipeline includes a community known as McLean Crossing in McLean, Va., and a residential tower at 1775 Biscayne Boulevard in Miami.

The company has 48 developments total in its portfolio.

Mark Hallum can be reached at mhallum@commercialobserver.com.