Plans to revitalize a full block of Marin Boulevard may have hit a snag following a rival developer’s claims of corruption behind the deal.
On July 2, a fresh lawsuit was filed in Hudson County civil division by Saddlewood Court LLC. The company, which owns a prefabricated home on a redevelopment site, is owned by Shuster Management and controlled by Eyal Shuster and Adam Knoll.
The complaint centers around a proposal from Lennar dubbed Laurel & Saddlewood that first emerged in February last year. That company is looking to redevelop 1.81 acres along First and Second streets straddling Marin Boulevard and Grove Street with a 50-story tiered building of 810 rental apartments and 41 units of affordable housing.
Besides a new plaza and 14,000 square feet of retail space, a new 50,000-square-foot public school would be built under the deal. Jersey City later declared the block a condemnation redevelopment area to facilitate the plan, as Lennar owns 37 of the 38 homes on the land.
Saddlewood Court’s claims in their 16-page lawsuit focus on the school component, which they argue drove the condemnation designation. The case says that Jersey City Mayor Steve Fulop “proudly proclaimed that his administration was getting ‘creative’ by leverag[ing] the private sector…to build new schools at no cost to the taxpayers.”
The filing alleges that as part of its so-called leveraging, Jersey City “reached a corrupt quid pro quo arrangement with Lennar whereby the[y] agreed to a pre-determined, sham blight designation of the Laurel-Saddlewood Block, and further agreed to designate [Lennar] as the redeveloper of same, in exchange for Lennar’s development of a multimillion dollar school.”
The plaintiffs say they learned of the improper arrangement on February 21 of this year following a meeting with Charles Epstein, who serves as Vice President of Lennar. Epstein allegedly advised them that Jersey City “guaranteed” that the Laurel-Saddlewood Block would be blighted well before the redevelopment process began, with Lennar set to be designated as redeveloper.
“In fact, Mr. Epstein went so far as to comment that Lennar was told by the City, prior to the time it even commissioned an investigation of the Laurel-Saddlewood Block, that if the City received a new school from Lennar, it would blight the Laurel-Saddlewood Block and designate [them] as redeveloper,” the case claims.
Epstein allegedly further disclosed that Lennar promised a new school in exchange for the redevelopment designation, supposedly justifying the move by explaining that “this is the way things are done in New Jersey.”
“But for Lennar’s backroom promise to develop a multi-million-dollar school, the City would not have caused the City Council to adopt [the redevelopment resolution],” the complaint says.
Saddlewood Court alleges four counts of civil conspiracy and bad faith in their complaint, which seeks a declaratory judgment voiding the redevelopment designation. Named as defendants in the case are the City of Jersey City, the Jersey City Redevelopment Agency, and Lennar Multifamily Communities.
Jersey Digs reached out to Lennar regarding the lawsuit and have thus far not received a response. Jersey City Press Secretary Kimberly Wallace-Scalcione declined to comment on the specifics of the litigation but defended the proposal’s givebacks and community engagement.
“It is important to note that this project will include affordable housing, a public park, flood mitigation, and a new 50,000 square-foot public school for PreK-5 students to help alleviate the school system’s overcrowding and long waitlists – all valued at nearly $25 million, at no cost to taxpayers,” she said in a statement to Jersey Digs. “The City has worked closely with all of the Laurel and Saddlewood Court homeowners, all of whom are fully supportive, except for one person who does not actually live in the area.”
Saddlewood Court filed a previous lawsuit last year over the same proposed development, a case that was dismissed in May. Another company associated with Shuster Management filed a separate court challenge seeking to block Epire’s 144 First Street development, which broke ground last month.