Mar. 24--Two developers said Thursday they are going to construct a four-story office building on Front Street in Red Bank on the site once occupied by the Schwartz automobile dealership.
West Long Branch-based PRC Group and Mack-Cali Realty Corp., based in Cranford, said they would team up to build the Red Bank Corporate Plaza. The project, expected to be completed by the third quarter of 2007, already has been leased to Hovnanian Enterprises Inc.
The 93,000-square-foot project will include an 88,000-square-foot office building, a one-story, 4,900-square-foot retail center and a four-story parking garage. Officials, who said the project already has received municipal approval, declined to disclose how much it would cost.
A second phase of the project, an 18,560-square-foot office building, will be developed later, the companies said.
One executive said the deal represented an endorsement of the Monmouth County office market, which has suffered since telecommunications companies downsized and closed earlier in the decade.
Monmouth County's high-end office space had a 9.7 percent vacancy rate at the end of 2005, compared with a 13.6 percent vacancy rate at the end of 2004, according to the most recent Sitar-Rutgers Regional Report.
Mitchell Hersh, Mack-Cali's chief executive officer, said his company, a real estate investment trust, has recently bought office buildings in Holmdel, Middletown and Freehold. Hovnanian, which signed a 10-year lease for the building, is one of several companies expanding in the area, he said.
"Quite frankly, I would have built the building anyway (without Hovnanian's commitment), but this is my preference, to have it on a pre-lease basis," Hersh said.
Hovnanian officials declined to comment on the project, leaving it unclear whether they are going to occupy the building or sublease it to other tenants.
The company, currently based in Middletown, is expanding in Red Bank quickly. It is building a 65,200-square-foot headquarters across the street from the Red Bank Corporate Plaza. And it recently moved into two floors of the Noglows Building, a new 10,000-square-foot building on Monmouth Street, that building's developer, Paul Noglows, said Thursday.
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