BORO LOT, W/ RIV VU, MAY GO ON BLOCK

Img_4241Img_4253Two views of the disused borough parking lot at the foot of Maple Avenue that may come up for sale this year. Click to enlarge images.

Hoping to trim a proposed budget that would otherwise sock property owners with a 20-percent tax increase, Red Bank officials have hired an appraiser to set a value on a primo piece of borough-owned land, redbankgreen has learned.

The hiring of Peter Sockler could mean that the property, at the foot of Maple Avenue, will go on the market this year, says Mayor Pasquale Menna.

Because it’s a buildable lot with an unimpeded, panoramic view of the Navesink River, “it’s a very desirable property,” says Menna. “Where else are you going to get that kind of view?”

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RED BANK BUDGET DRAFT: $311 INCREASE

Taxes

Red Bank officials last night introduced a proposed 2008-’09 budget that would increase the local portion of the typical homeowner’s property taxes by $311.20 per year.

The figure is just a starting point for several weeks of refining and public comment, borough officials said. But the $19 million spending plan — $10.4 million of which would be raised by taxes and fees — lands at a time of statewide fiscal turmoil not seen in several years.

It also reflects a quadruple whammy:

• a $362,000 spike in the borough’s state-mandated contribution to pension costs for public employees;

• the elimination of $182,000 received as state aid from Trenton last year;

• the full impact of debt service costs not felt in the last three years, even as the borough was racking up $6.38 million in bonding costs for infrastructure repairs;

• and a slowing economy, which has cut into fees from builders and other sources.

“There are no sacred cows in this budget. We have to make some rather difficult decisions — they’re going to be painful decisions this year,” said Mayor Pasquale Menna. “We’re going to have to make some very difficult, politically charged decisions with regard to some employees.”

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NON-PROFITS TO LOSE FREE TRASH PICKUP

Img_4211Red Bank Catholic and St. James Elementary School are about to see their trash-removal costs rise.

Red Bank is tightening its fiscal belt, and non-profits that generate more trash than the typical household are about to feel the pinch.

Last night, the mayor and council introduced a proposed ordinance change that would require any non-profit that puts out more than two household-sized barrels of trash for each of the twice-weekly pickups to make private collection arrangements.

The move, which is expected to have a significant impact on the St. James School/Red Bank Catholic High School complex on Broad Street and Peters Place, should save the borough roughly $50,000 a year in dumping fees at the Monmouth County landfill, says Mayor Pasquale Menna.

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HOV SLUMP EXTENDS WITH $131M LOSS

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Red Bank-based Hovnanian Enterprises reported its sixth consecutive quarterly loss yesterday, this time a $131 million shortfall that was double the year-prior amount.

The publicly traded homebuilder, which operates in 19 states, managed to sell more units in its lastest fiscal quarter — 3,604 homes, up 10 percent from a year ago — but at lower average prices, the company disclosed. As a result, quarterly revenue fell 6.2 percent to $1.09 billion, from $1.17 billion.

From the Associated Press:

“Market conditions remain challenging across many of our markets,” President and Chief Executive Ara K. Hovnanian said in a statement.

The company will continue to reduce inventories, maximize cash flow and shrink overhead, he said.

“Despite the persistence of negative factors impacting the homebuilding industry, we are diligently working to position the company to take advantage of the stronger demand for new homes that will inevitably return once the current housing correction ends,” Hovnanian said.

He did not suggest when that might occur.

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COURT TIME: BOROUGH PLANS LAWSUIT

Img_3474Oh, brother: this one’s headed to Freehold.

The Red Bank council has authorized Borough Attorney Tom Hall to file a suit against the Community YMCA over that organization’s plan to sell the Children’s Cultural Center, redbankgreen has learned.

At issue, says Hall, are the terms under which the borough deeded the 116-year-old red brick marvel to Kids Bridge, a Children’s Cultural Center predecessor charity, for $1 in April, 2000.

The complaint, which Hall said he expects to file in state Superior Court in Freehold by early next week, will not immediately involve separate allegations by the Y that the borough owes it some $500,000 over renovation costs to the Monmouth Street structure. But Hall said he expects the Y to countersue over that issue.

“What they do about the construction costs is up to them,” he said.

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WATER BILLS, ALREADY HIGH, GOING UP

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When the economy is, um, flush, and the infrastructure doesn’t break down, Red Bank’s water utility sometimes generates a surplus that gets poured into the general fund.

That happened last year, when $300,000 was moved, offsetting the need for that much in property tax collections. And the Borough Council hopes to wring another $200,000 out of the utility in the coming tax year.

But the economy has slowed, and with it, construction, which means reduced growth in connection and use fees for water and sewer services. And the turndown comes at a time that principal payments on $6.38 million worth of long-term debt for a string of emergency repairs kicks in, adding a whopping $337,000 in charges over the current year.

Bottom line: a loss in 2007 of $183,259 that has to be made up, and a forecast of $607,000 in higher costs in the coming year.

The only solution, officials say, is to jack up the rates.

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RIVERCENTER EXEC TO MEET WEST SIDERS

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The special assessments are being collected — and have been since last September.

Now,
Red Bank RiverCenter is moving to solicit input from business owners in the West Side expansion zone about how those funds might best be spent to boost the district.

RiverCenter, the overseer of both the original downtown special improvement district and now its western portion, has invited merchants, restaurateurs and property owners covered by the expansion to a pair of brainstorming sessions to be held this week at Racioppi’s restaurant on Oakland Street, next to the train station.

“We’re trying to do an outreach,” says RiverCenter executive director Nancy Adams. “I just want to hear from them what the issues are on the West Side.”

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ANOTHER DONOVAN’S DEAL FALLS APART

Donovans_1007_2Might there be another summer of cocktails on the beach after all?

By LINDA G. RASTELLI

For the second time in six months, the owners of Donovan’s Reef are back to square one in their effort to sell the beachfront bar, redbankgreen has learned.

A proposed $5 million sale to Stone Enterprises of Toms River announced in Octoer is off the table, and the owners are looking for another buyer, says Bob Phillips of Avon, one of three partners in the oceanfront nightclub.

Stone, a condominium builder, backed out of the deal, Phillips said, though he declined to discuss specifics.

“Life goes on,” Phillips said.

Last year, the Borough of Sea Bright considered, and then rejected, the idea of buying the club, located next to its borough hall. Councilman Tom Scriven said last week that the cost of the property was too high to be practical.

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RESTAURATEURS LAY IT ALL ON THE TABLE

Lyristis_george_2The Bistro’s George Lyristis: “You can’t always ask somebody else to fix the problem.”

Business is tough these days for many Red Bank restaurants. And it’s not simply a matter of the winter blahs.

The economy has soured. Would-be patrons are turned off by the perception of aggressive ticketing by the borough Parking Authority, and by real or perceived parking shortages. Competition from Pier Village in Long Branch and even downtown Asbury Park is siphoning off business.

And that’s just the out-of-towner trade. Then there are closings of retail stores and — less noticed — second- and third-floor businesses that supply a steady flow of weekly customers. A doubling of taxes last year after a revaluation has added to the burdens of premium-priced leases.

“You know what it is? It’s the two-, four-, six-person offices,” says Gary Sable, who owns That Hot Dog Place off Monmouth Street. “It’s the parking, it’s the rents. They’re moving out to Tinton Falls, moving out to Wall Township.”

As Zebu Forno owner Andrew Gennusa sees it, the problem is a borough administration that is indifferent to the impacts that soaring taxes and picayune code enforcement have on downtown businesses. “They have a heavy hand in this town,” Gennusa tells redbankgreen.

Conditions, in other words, are widely thought to be less than ideal for businesses that require big capital investments and daily purchases of large amounts of perishable inventory.

So roughly a dozen owners of restaurants, delis and takeout businesses from throughout Red Bank — not just the downtown — have decided to put their heads together to see what they might do collectively for themselves.

At this point, it’s little more than a concept, but they think they may have gotten the ball rolling on forming a restaurant association, an organization that will cater (pardon) specifically to their needs.

“Restaurants bring a lot of business into this town,” says George Lyristis, who owns The Bistro at Red Bank on Broad Street with his brothers Charlie and Tasso. “But we don’t have a voice.”

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MTOWN REVAL: 26 YEARS AND COUNTING

A revaluation of property in Middletown that Monmouth County wanted effective this year won’t be, today’s Asbury Park Press reports.

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From the story:

County officials are now probing why Middletown did not comply with an order from the Monmouth County Tax Board to have the revaluation take effect in 2008, instead of 2009.

Middletown officials, who hired a special attorney late last year to evaluate whether the township could legally seek a postponement of the revaluation in part because of fluctuating real estate prices, say the municipality did not have enough information to submit a complete filing by a Jan. 10 deadline.

“I didn’t believe that the town could be finished in time,” Charles Heck, Middletown’s tax assessor, told the board today. “That’s what possessed me to file a book on Jan. 10 the way that I did.”

But here’s the part that jumps out:

Middletown’s last reassessment was in 1991; its last revaluation was in 1982, county officials said.

A reassessments is completed by a local tax assessor, whereas a revaluation is done by an outside firm. Red Bank went through a revaluation in late 2006 that hit taxpayers last year; the average property value more than doubled in the process.

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HOV STOCK, RECENTLY IN DUMPS, SOARING

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This time three weeks ago, shares of Hovnanian Enterprises were at a seven-year low, trading below $5 apiece.

Four dollars and eighty cents, actually, as of the close on Jan. 9. No doubt investors who’d bought the stock as it peaked above $72 in mid-2005 weren’t too pleased. Even a year ago today, the price was about $36.

The giant homebuilder, headquartered on West Front Street, has been suffering through the prolonged, multi-symptom flu that’s devastated the real estate and lending industries nationally and fueled fears of a U.S. recession around the world.

So when Standard & Poors downgraded Hov’s preferred shares and put the company’s debt on watch with “negative implications” one week after that low, one might have expected the common stock to fall farther. But it didn’t. Instead, it rose.

And it’s kept rising.

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S&P CUTS HOV RATINGS, BUT SHARES RISE

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Ailing national homebuilding giant Hovnanian Enterprises saw its stock and debt downgraded by a major ratings agency yesterday, but investors bid the company’s stock up neatly anyway.

The price of a share rose 70 cents, or almost 12 percent, to $6.63 today, continuing a recent climb out of a basement. For the first time in seven years, Hovnanian shares were trading below $5 last week.

Earlier in the day, Standard & Poor’s put the Red Bank-based company’s debt on credit watch with “negative implications” and downgraded it’s preferred shares after the company failed, as expected, to make a dividend payment to shareholders Tuesday.

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TIFFANY FEELS DOMESTIC ECONOMY PINCH

Garmany2c

Tiffany & Co., which opened much-anticipated new store on Broad Street in November, saw sales in its American stores that had been open a year or more dip 2 percent in the November-December period, the jeweler announced late last week.

The New York Times called it “a sign that a pullback in consumer spending that started at the low end of American retailing is percolating up to high-end merchants.”

From the Times account:

The slowdown was unexpected, and it sent jitters through the world of luxury-goods makers, who had seemed invulnerable over the last five years, even as energy prices surged and the housing market began to sputter.

The Tiffany results were among the clearest evidence yet that wealthy consumers — and middle-class shoppers who sometimes splurge on luxury items — are starting to tighten their purse strings.

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FOR DOWNTOWN SELLER, TOO-EASY MONEY

25broadSold, for more than the seller ever dreamed: 25 Broad Street.

Stuart Paer’s request to the Red Bank Planning Board on Monday night went through like lightning.

He was asking for a change of use for the second-floor space in a building he owns at 25 Broad Street. Long utilized as an office, it at one time served as an art gallery owned by Lloyd Garrison, and is now used as an office again. The board granted the request. The whole thing took about five minutes.

And just like that, Paer cleared the last hurdle that will enable him to sell the building, and another one he owns at 19 West Front Street, to a Brooklyn-based buyer for $3.2 milion.

What does it mean for downtown? We’re not sure. But when a seller boasts, before a closing, that he’s getting more for a building than it’s worth, it just might be a sign of an overheating market.

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HOVNANIAN: NOT YET THAT SUNK

Hovnanian_new

Today’s Star-Ledger takes a look at the “dismal” year that Red Bank-based Hovnanian Enterprises has had. And the coming year doesn’t look at lot brighter.

But to make that point, the page-one story kicks off with an an anecdote that appears to confuse, or perhaps conflate, members of the Hovnanian family:

The Hovnanians have been building homes in New Jersey for almost a half-century, but the measure of their success was never more indelibly stamped than in a 1992 mishap, when the family’s 123-foot yacht sank off Cape May.

Outfitted with teak paneling, gold-plated fixtures and other luxuries, the $10 million sport-fishing boat seemed more worthy of an oil sheik than crafters of humble condos.

In the years since, Hovnanian Enterprises has grown into the nation’s sixth-largest homebuilder, snapping up smaller businesses and expanding into a total of 19 states. Riding the great housing boom of the past decade, the company built developments as fast as it could, with homebuyers queuing up overnight to sign sales contracts like groupies camping out for Hannah Montana tickets.

The credit crunch and a glut of unsold homes has put an end to those glory days, however. And this time, it’s the Red Bank company itself that’s taking on water.

But the yacht belonged to Hirair Hovnanian, a brother of the man who founded and controlled Hovnanian Enterprises.

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HOVNANIAN: LOSS QUADRUPLED IN 4Q

Hov_hq_81206File photo of Hovnanian’s Red Bank HQ, as seen from the foot of Maple Avenue.

Amid a widespread credit shutdown, Hovnanian Enterprises said its fourth-quarter net loss quadrupled over year-ago results.

The Red Bank-based homebuilding company yesterday reported a net loss of $469 million in the quarter, compared to $118 million in the fourth quarter of 2006. Contract cancellations rose to 40 percent, from 35 percent in the third quarter. Revenue for the year was down more than 22 percent, to $4.58 billion, from $5.9 billion in fiscal 2006.

As a result, the company said it won’t pay a dividend this year on a class of preferred shares.

Still, the company saw a glimmer of better days to come after the fiscal quarter ended.

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NY POST: GOOCH ON RUDY AND RICHES

Gooch_1

Today’s New York Post features a Q&A with Rumsonian Mickey Gooch, who among other things is a Wall Street billionaire, head New Jersey fundraiser for GOP presidential hopeful Rudy Giuliani and co-owner, with his wife Diane, of the Red Bank-based Two River Times.

In the interview, Gooch explains why so many Wall Street firms — but not his — have gotten hammered in the credit meltdown, how his boy Rudy’s doing in New Jersey, and whether he finds it “satisfying” to be a paper billionaire.

From the story:

Q: New Jersey has raised a lot of money for Rudy?

A: Rudy has raised more money in the state of New Jersey than any other candidate including the Democrats, and the only other state where he has achieved that is Texas.

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MIDDLETOWN BALKS ON REVAL

Taxes

An ebb tide of property values and glut of ‘for sale’ signs has Middletown officials thinking this might not be he best time for a revaluation, today’s Asbury Park Press reports.

Township officials have hired a taxation law expert to tell them if they have a case for asking the Monmouth County Board of Taxation for a reprieve on doing a reval that uses Oct. 1 as the reference date.

From the story:

“Our concern is that if the values are so off, the number of (tax) appeals will be very high,” Middletown Deputy Mayor Pamela Brightbill said.

Citing an “ever-increasing number of “for sale’ signs,” news that properties are not selling and a rising number of foreclosures, Brightbill said there has been growing concern that the updated property values will be inflated if the market continues downward.

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MERCHANTS: TIFFANY WILL HELP, NOT HURT

Img_8228A customer tries on a bracelet at an opening-night reception at Tiffany & Co.’s Broad Street store earlier this month.

The Asbury Park Press today pops in on store owners in downtown Red Bank to gauge their feelings about the recent arrival of Tiffany & Co., and finds the welcome mat is out.

In fact, writes business reporter David Willis, “other businesses in town have showered the store with flowers and gifts.”

“They have been dropping in to see the store,” said store manager Vicky Shortland. “Just very welcoming.”

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TIFFANY SET TO TWINKLE ON BROAD STREET

Garmany2c

Love it or loathe it, Tiffany & Co. arrives in Red Bank tomorrow with the opening of a 6,000-square-foot emporium of luxury that caps the downtown’s 17-year sprint from economic backwater to one of the most admired in all of New Jersey.

Select guests will be treated to tours of the new store today. The big brushed-metal doors open to the public tomorrow.

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HOV CONTRACTS FALL OFF ANOTHER CLIFF

Hov_hq_81206Hovnanian’s Red Bank HQ, as seen from the foot of Maple Avenue in sunnier days.

Red Bank-based Hovnanian Enterprises, one of America’s largest publicly traded homebuilders, got walloped again in its latest fiscal quarter.

Continuing a slide that company official haven’t been able to foresee the end of, Hovnanian reported that sales results “significantly deteriorated” in October from recent months, with new orders down and contract cancellations up steeply.

As reported by Reuters:

Hovnanian said preliminary results for the fiscal fourth-quarter ended October 31, showed that excluding unconsolidated joint ventures, net contracts fell 10 percent to 2,781 homes, while sales slid 19 percent to 3,969 homes.

Would-be buyers canceled contracts at a rate of 40 percent, as many found themselves unable to qualify for mortgages. The cancellation rate rose from 35 percent in the prior quarter as well as the year-earlier quarter.

In early September, the company reported stronger-than-expected sales activity as a result of steep markdowns and heavy promotions that in some cases cut hundreds of thousands of dollars from asking prices for new homes.

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PRESS: FOXTONS RUNS OUT OF GAS

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Its signs, and tiny cars, may have seemed ubiquitous. And the basic idea — transacting home sales at commission rates lower than those typically offered by real estate brokers — seemed like a winner.

But local upstart Foxtons is sputtering to a close, today’s Asbury Park Press reports.

The West Long Branch firm announced last night that it was done in by the sharp slowdown in the residential market and will lay off 350 of it’s 380 employees, the Press reports.

A bankruptcy filing remains a possibility, a company official told the newspaper.

From the story:

“The plain fact is that we have been battling against a real estate market that recently has turned into a sharp decline, and the company no longer has the liquidity to operate as a going concern,” said John D. Blomquist, Foxtons’ senior vice president and general counsel.

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HOV: WEEKEND PRICE CUTS MOVED UNITS

Slashing sticker prices and throwing in extra amenities, Hovnanian Enterprises reports that its weekend sales push on new housing units nationwide exceeded expectations.

Wall Street cheered the report, boosting the battered homebuilder’s stock price yesterday.

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From a report on Bloomberg.com:

The company had gross sales of 2,100 homes. More than 1,700 potential buyers signed contracts and 400 gave deposits, Red Bank, New Jersey-based Hovnanian said today in a statement. The sale began on Sept. 14 and ended yesterday. It has boosted the company’s shares almost 13 percent in the past two trading days.

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HOV PRICE-SLASHING ‘UNPRECEDENTED’

Today’s Star-Ledger reports that Red Bank-based homebuilding giant Hovnanian Enterprises is cutting prices and offering incentives worth up to $240,000 on unsold new homes, discounts that industry experts call unprecedented.

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From the story, by business reporter Joe Perone:

Just a few years ago, Hovnanian Enterprises held lotteries to sell new homes because demand for housing was white-picket-fence hot.

Now, with the residential real estate slump deepening by the month, the largest New Jersey-based homebuilder is holding a fire sale at developments across the country. Prices this weekend will be slashed by up to six figures — $100,000, $149,000, in some cases $240,000.

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ON DECK: A TRADER JOE’S AND A GARAGE?

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It is perhaps the single most contentious issue in Red Bank: whether the downtown needs a parking garage.

Merchants, in general, say yes. They complain that a shortage of street and lot parking is choking their businesses and undermining broader efforts to capitalize on the town’s sterling reputation as a cultural and shopping destination.

Building a garage that significantly increases the number of parking slots in the central business district is the best thing Red Bank could do to preserve its stature among New Jersey downtowns and stave off threats from Pier Village in Long Branch and other emerging marketplaces, proponents say.

But many residents say no way to a parking deck — not if they have to pay for it with higher property taxes.

Efforts by the Democrat-controlled council to convert the borough-owned White Street lot to a parking deck attracted large, angry crowds in 2001 and 2005. The latter attempt called for a 570-car, $11.8 million structure. Both times, the idea was shelved.

The solution, many agree, is some form of public-private deal in which a developer carries the financial risk and the town gets both revenue and more slots.

Finally, a plan along those lines may be in the works. And it involves a high-profile retailer that has done this sort of thing before elsewhere.

redbankgreen has learned that representatives of Trader Joe’s, a wildly popular chain of specialty food stores with affordable prices, met with borough officials two weeks ago to explore the possibility of building a store with a parking deck above it on the White Street lot.

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