Kushner and KABR Sue Jersey City, Claiming Anti-Trump Politics

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Kushner Kabr Sue Jersey City One Journal Square
One Journal Square rendering by Woods Bagot.

The seemingly never-ending saga of One Journal Square added yet another layer of drama yesterday, as several subsidiaries behind the project filed suit against Jersey City, Mayor Steve Fulop, and the Jersey City Redevelopment Agency.

The history of the development is starting to resemble a novel at this point, but the short version is that KABR Group and Kushner Companies purchased the property in 2015. An earlier version of the project was taller and had signed co-working giant WeWork to operate over 100,000-square feet of office space in the building, but that company pulled out of the deal and took $59 million in tax breaks with them.

Kushner Kabr Sue Jersey City One Journal Square 3
One Journal Square rendering by Woods Bagot.
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A scaled-back version of the development featuring twin 66-story towers was approved last September. But in April this year, the Jersey City Redevelopment Agency sent Kushner and KABR a Letter of Default saying they violated a redevelopment agreement the parties entered into following the project’s initial approval in 2015.

The letter stated that Kushner Companies and KABR Group failed to start construction by January 1 of this year, have failed to submit firm financing commitments to the JCRA, have failed to obtain or waive redeveloper contingencies before they expired, and have failed to submit an annual administrative fee that was due in April of 2017.

Lawyers for KABR and Kushner officially fired back yesterday with a lawsuit in Federal Court, slapping the city with breach of contract, civil rights, and due process violations. The companies claim that shortly after 2017’s swearing-in of President Donald Trump and the naming of former Kushner Companies CEO Jared Kushner as a senior advisor, Jersey City’s Deputy Mayor Marcos Vigil advised them that, for political reasons, they “should submit [their] application for tax abatements by April or May, or should wait until after elections for Mayor and City Council were held in November.”

Kushner Kabr Sue Jersey City One Journal Square 2
One Journal Square rendering by Woods Bagot.

Later last year on May 7, not long after controversies surrounding Kushner’s solicitation of Chinese investment under the EB-5 visa program for the project became public, the lawsuit says that Mayor Steve Fulop posted on Facebook that his administration made clear to the companies that “the city is not supportive” of their tax abatement request for One Journal Square. The case claims that Fulop’s statement “was a repudiation of the contractual promises in the Redevelopment Agreement obligating the City and the JCRA to cooperate with [Kushner and KABR] in obtaining abatements” and was made “to curry favor with the overwhelmingly anti-Trump constituents of Jersey City.”

The lawsuit says that the companies attempted to meet with Jersey City officials in September 2017 to discuss extending certain deadlines in the redevelopment agreement, but the JCRA canceled the meeting and then “unilaterally cut off communications” with them. Following Fulop’s re-election, Kushner’s lawyers claim a meeting was held with the mayor on January 10 this year about why the project wasn’t moving forward.

During that meeting, the lawsuit says Fulop told representatives of Kushner that “it would be blatant discrimination” to refuse to provide tax abatements for the One Journal Square project, but later confirmed that “the true motive in the denial of the tax abatements was the involvement of the Kushner family, stating that it was ‘really tough’ to move forward with the deal, and that the problem would go away if the Kushners left the deal and a new partner was brought in.”

In one of the lawsuit’s more colorful passages, the companies claim that after Bloomberg published a piece about a possible January groundbreaking at One Journal Square, “Fulop called a member of KABR Group…stating angrily ‘what the f*ck is going on with this article?’” The lawsuit then cites several tweets from the mayor lamenting a “sense of entitlement that the developer has towards a subsidy” for the project.

The filing claims the mayor himself “orchestrated the Notice of Default, conspiring with the city entities he controlled, in an attempt to push the Kushner family out of the project.” They also argue that Fulop has failed to properly submit their tax abatement request to the City Council within the legally required 60 days despite them sending it to his office on April 6.

Fulop fired back over the lawsuit last night on Twitter, stating that the case is “nonsense” and that “the same way they illegally try to use the presidency to make money when it suits them is the same way here where they try to use the presidency to be pretend victims when that suits them.” He also told the Jersey Journal in an email that “it’s not like the Kushners have a great deal of credibility in anything they say.”

You can read the full filing here.

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9 COMMENTS

  1. Kushner lawsuit sounds weak, it’s going to be hard to prove the city was acting in discrimination…

    you know what’s easy to prove? That the project hasn’t broken ground, that Kushner can’t get funding for the project, that the land just sits vacant collecting litter, that weworks backed out of the deal, that KABR Group hasn’t paid their fees.

    So good luck with that one! And SOMEONE PLEASE develop this land already!!

    • Classic stall tactic; famously used by his father in law. I’m so confused. They want a wall but meanwhile they sell EB-5 visas to the Chinese? I thought they hated China? This lawsuit won’t hold up in court but it sure will waste a lot of time and money. Way to stick it to the city KABR

      • Yup exactly, I like how they park 2 cars in the lot every few days to act like someone is actually doing something. But the cars are always empty…and no one is ever doing anything!!

  2. They are just trying to stall because the city now has the right to sell the land to someone else and they are trying to stop that and force the city into an agreement

  3. This whole thing is sad. I walk by this lot everyday. This is smack in the middle of EVERYTHING! This lot not being built for whatever reason is the problem. They should just have a mediation, and come to some sort of an agreement! BUILD THE TOWERS! Stop the nonsense! City should encourage this project since it’s in the city’s interests(even with a tax abatement) THE CITY OF JERSEY CITY NEEDS THESE TOWERS TO BE BUILT! Therefore, the mayor, JCRA, KARB, and KUSHNER must stop being children and do what EVERYONE WANTS!

    • The problem is Kushner can’t get funding for the project because no one wants to work with him and his shady cronies. That’s really the major issue at hand. That’s why they can’t break ground is because they don’t have the money to build. So they will just keep stalling until they can fund it. That’s why JC wants to give it to another developer who can actually get the job done!

  4. Um, someone please explain to me why Kushner’s brother, Murray, who is a staunch democrat is able to build almost an identical building with significant tax abatement directly across the street? Fulop politicized a building that would have brought jobs to the city, hundreds of new tenants who would have spent money in local establishments, and anchor tenants that would have increased safety in the neighborhood. Fulop sounds so shady.

  5. Just get one of their Russian or Chinese friends to do a solid and provide financing so this one can get built already!!

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