Hahne & Co. Case Study We are pleased to present a ULI case study of the redevelopment of the historic Hahne & Co. building in Newark, New Jersey. This is the first in a series of case studies and briefs jointly created by ULI and Cornell University’s Baker Program in Real Estate. The Baker Program is honored to collaborate with ULI and looks forward to contributing to the continued success of these case studies and briefs, which are important resources for professionals throughout the real estate industry. All ULI case studies and briefs can be found on ULI’s website at https://casestudies.uli.org/. Hahne & Co. Captions: PROJECT SUMMARY LOADING DOCK The historic Hahne & Co. building was redeveloped by a joint venture among affiliates of L+M Development Partners Inc. (L+M), Prudential, and Goldman Sachs from a once grand but vacant department store into a lively mixed- RESIDENTIAL LOBBY use development in the heart of downtown Newark, New Jersey. Built in 1901 at 609 Broad Street, the Hahne & ARCADE ENTRANCE Co. Department Store stood empty since its namesake brand closed in 1987. The building rises four stories and is now linked to a nine-story tower constructed on an adjacent parcel for a total of 528,500 square feet. This adaptive reuse includes 160 apartments–both market-rate 10 and affordable–as well as 75,000 square feet of retail. Rutgers leases nearly 60,000 square feet for a community arts collaboration space and campus bookstore, while other tenants occupy over 40,000 square feet of office space. The Grand Court located under the building’s historic skylight provides access to many commercial spaces and serves as a community gathering area. The project also includes over 200 underground parking spaces. The redevelopment opened in phases, first in January 2017, and it was completed in late 2018, after five years of planning and construction. THE SITE AND THE IDEA Site plan. (L+M Development Partners) The City of Newark, New Jersey, is a major employment center and commercial hub of the northeastern United States. Having suffered serious decline in the latter half of Site plan. (L+M Development Partners) the 20th century, at the time of the rehabilitation of Hahne & Co., the downtown area was characterized by a population building had floundered and it remained abandoned for 30 of mainly office workers who vacated the area in the years until L+M broke ground in 2015. Due to the many evening. While there was still some nearby street activity challenges presented by this redevelopment, Tim Lizura, due to the New Jersey Performing Arts Center and Rutgers the former Executive Director of the NJEDA, once referred University, the area lacked vibrancy. The site itself had been to it as “a site where developers came to die.” long recognized for its redevelopment potential in bringing life back to the area, but several attempts to redevelop the This landmark department store building is located on 52 a 2.39-acre site that occupies half of a city block on the Because of the size and location of the Hahne & Co. north end of downtown Newark and 0.3 miles north of the department store, the redevelopment project originated intersection of Broad and Market Streets, the center of with the idea of a mixed-use redevelopment, including a the city’s street grid, and 0.45 miles northwest of Newark combination of apartments, retail, and office space. These Penn Station. Hahne & Co. is in the historic Central Ward uses were brought together under a four-story Grand Court (earlier known as the Third Ward) that includes many of running lengthwise through the building. This atrium was Newark’s historic public spaces, one of which is Military capped by a steel and glass skylight, which served as the Park, downtown’s largest green space. The Hahne & Co. focal point for the redevelopment. building fronts directly on Military Park. At the time of the conceptualization of the project, this park was in the process The historic restoration and conversion of the property of a long-awaited revival by local stakeholders, thanks in centered on the removal, offsite restoration, and re- large part to a substantial grant from Prudential. To the west installation of this glass skylight. The newly rebuilt skylight, of the site is Halsey Street, a local commercial corridor, the together with a reimagining of the original atrium space with Rutgers University campus, which enrolls 12,000 students, the skylight relocated from the fourth to the second floor, and the New Jersey Institute of Technology, which enrolls proved to be challenging but ultimately paid great dividends. more than 11,000 students. The area to the south of the site was redeveloped simultaneously with this adaptive reuse project. The new 20-story Prudential Tower situated across New Street brought 6,000 workers to the downtown though the area still lacked any significant mix of uses or vibrancy. All of these factors served as the context for the concept of the multi-use combination of functions that were fused into the proposed program for the building. Lying at the nexus of important corridors of downtown Newark, the project was envisioned as a node around which the downtown could gather and grow. The dearth of residential options in the area was also an important piece of the development— addressing the need for market rate and affordable The Grand Court at Hahne & Co. and its skylight serve as the housing—while taking advantage of tax credit funding. As focal point of the historic redevelopment. The Grand Court The Grand Court at Hahne & Co. and its skylight serve as the focal point of the historic the project developed, it was also tied into the institutional redevelopment.offers access The Grand to Courtmany offers of accessthe commercial to many of the commercial spaces spacesin the in buildingthe building surroundings with the relocation of the Rutgers University andand serves serves as a community as a gatheringcommunity area. (L+Mgathering Development area. Partners) (L+M Development Partners) Department of Arts, Culture and Media. This community arts and education program facility, “Express Newark,” encourages the creation of a more mixed-use downtown, one with daytime and evening activity seven days a week. DEVELOPMENT BACKGROUND AND PROCESS The Hahne & Co. redevelopment project was spearheaded by a partnership between L+M, a New York-based developer with a record of success undertaking real estate developments in the five Boroughs, and Prudential. The developer had been looking to New Jersey, particularly Newark, as it believed these markets had strong growth potential. The firm recognized that Newark had excellent infrastructure, beautiful historic buildings, and a motivated group of local stakeholders. A critical component of the redevelopment project, the Whole Foods Market at the corner of Broad Street and New Street addressed the pre-existing food desert in the surrounding downtownA critical Newark component area. of (L+M the redevelopment Development project, Partners) the Whole Foods Market at the corner of Broad Street and New Street addressed the pre-existing food desert in the surrounding downtown Newark area. (L+M Development Partners) 53 The flagship Hahne & Co. Department Store was built in 1901 and served as the retail anchor at Broad Street in historic downtown Newark, New Jersey. (L+M Development Partners) Indeed, L+M initially had not anticipated how complicated it space in the Grand Court as being a pivotal component would be, or whether it was even feasible, to undertake this of the structure as it facilitated layouts with interior-facing work with respect to the skylight. The skylight had not been apartment arrangements. touched since World War II and had since been capped with asphalt causing the glass to be badly damaged. “We Throughout the development process, and especially during substantially evaluated its replacement and surprisingly the approvals phase, L+M juggled the varied requirements found that the restoration was cost effective when compared of several different agencies. While local historic approval against the replacement,” remarked Jonathan Cortell, was reviewed by the Newark Landmarks and Historic a Managing Director of L+M. Choosing to restore rather Preservation Commission, NJSHPO, and the NPS, the site than replace the skylight also allowed the building to retain plan approval fell under the purview of the Newark Central more of the original characteristic of the building. Cortell Planning Board. Further, the Newark Building Department explained, “we note here that preservation would enable oversaw building code and construction details, and the an accurate representation of the building’s history as hiring and contracting aspect of the project was reviewed modern skylight systems use lightweight aluminum framing by the City of Newark. members while the original steel includes exposed rivets The Developers faced significant challenges during the and connections.” project mostly stemming from the building’s years of Opting for a restoration of the skylight also fostered a positive neglect. Due to their lack of maintenance, the building relationship with the New Jersey State Historic Preservation elements required close evaluation, beginning with the Office (NJSHPO) and the National Park Service (NPS). cast iron columns and steel beams. The columns were The restoration of the Grand Court was a requirement of the cracked in places and were thus reinforced and incased development, though electing to restore the skylight over in concrete to the roof. As a result of the increased dead replacing it was not compulsory. In addition to the Grand loads and structural changes to the building, and to ensure Court restoration, other historic aspects incorporated into the structural integrity of the floors, an additional three-inch the development include renovating historic railings, exterior lightweight concrete slab was added to the original concrete windows, the grand staircase, exterior facades, and the floors and a new concrete perimeter wall was built on the terra cotta cornice.