With over 5,500 new jobs being relocated to Camden, it appears the city is experiencing the most meaningful influx of investment since efforts to improve Camden began decades ago.
In the past, leaders in South Jersey and Trenton have created a multitude of economic stimulus programs intent on helping distressed cities throughout the State — with mixed results. The latest iteration, the New Jersey Economic Opportunity Act of 2013 (Grow NJ), was introduced to intensify efforts to improve safety, income, and quality of life in Camden and similar municipalities in New Jersey.
In Camden, the early stimulus programs of the 1990’s included monies to develop the Rand Transportation Center as well as the development of a new State office building, consolidating numerous State agencies under one roof.
The 100,000-square-foot Camden State office building, completed in 1991, was followed by the opening of the NJ State Aquarium (now the Adventure Aquarium) and a new 575,000-square-foot administration, research and production complex for L3 Communications in 1992. The Delaware River Port Authority (DRPA) headquarters building was completed in 1996, followed by the newly constructed four-story Ferry Terminal Building in 2007. It was the first privately financed office property built in Camden in over 48 years.
New Jersey’s efforts to stimulate private development through the New Jersey Economic Development Authority (NJEDA) programs, including the Business Employment Incentive Program (BEIP) and Business Retention and Relocation Assistance Grant (BRAGG), succeeded in drawing an occasional user over the bridge from Philadelphia and helped retain existing companies in South Jersey. However, it did not sufficiently jump start meaningful private investment in the city. Even coupled with the investment and development by Cooper Hospital, Rutgers and Rowan Universities, the successes weren’t enough for Camden to provide meaningful momentum.
The passage of Grow NJ heralded an unprecedented rush of private development activity in Camden. Campbell’s Soup named Brandywine Realty Trust the master developer for its 14-acre Knights Crossing Project (adjacent to Campbell’s world headquarters and includes the former Sears building). With the signing of Subaru of America for its headquarters, it was one of the first office projects to gain momentum and attract tenants with tax incentives.
The beneficiaries of this program — and Camden’s future corporate citizens — include household names like Lockheed Martin, the NBA’s Philadelphia 76ers, and others who will bring up to 5,500 employees to the city. With the announcement of Liberty Property Trust’s 26 acre development on the waterfront, many more well-known firms are likely to follow. The Liberty project has the potential for an additional 4,000 employees, 1.5 million SF of new office space, 200 residential units, retail, and a hotel.
A number of South Jersey companies are considering relocation to the Liberty site along with American Water Works, Inc. who was the first to commit to building a 222,000-square-foot headquarters facility there. Adjacent to the Liberty site, AthenianRazak (the developer of the Philadelphia 76ers new 125,000-square-foot training facility) is actively converting a 75,000-square-foot historic building at the foot of the Ben Franklin Bridge into modern loft offices under the name Ruby Match Factory. These projects provide companies considering Camden with new office construction, aggressive economic incentives, and easy access to a skilled labor pool on both sides of the river.
The Grow NJ program offers tax credits totalling up to $15,000 per year per employee for up to 10 years when companies commit to relocate to Camden for a period of 1.5 times the duration of the period they receive incentives. This program provides Camden and New Jersey with a powerful tool to compete for and retain businesses and jobs in the region and beyond — something it never had before.
Holtec International’s decision to locate its 600,000-square-foot technology campus in Camden exemplifies the desired effect of the program. Camden was able to secure this competitive project with an incentive package of $260 million over 10 years, resulting in anticipated job creation of 1,000 to 3,000 new jobs.
Reason for Optimism
Meaningful challenges remain in both Camden and South Jersey, including a recent decision to end the nearly 40 year old tax reciprocity program between New Jersey and Pennsylvania, and the vacancies in Camden and Burlington Counties created by corporate relocations.
Several recent announcements demonstrate cause for optimism. Virtua Health System is building a $22 million Family Health Center on its Camden campus, a private partnership is acquiring the 100,000-square-foot Terminal Ferry Building as a speculative investment, the State of New Jersey is funding the $133 million construction of a new 242,000-square-foot Camden High School, and the MD Anderson Cancer Center at Cooper opened a $13.5 million inpatient oncology center in July.
If Liberty Property Trust’s success at the Philadelphia Navy Yard is any indication of what can occur when incentives, investment, and planning intersect, then it is reasonable to believe there will be vibrant mixed use development on the Camden riverfront over time.
For Grow NJ to truly succeed, residents of Camden must benefit in the form of jobs and opportunity. If that happens, Camden may actually reach the tipping point that so many have worked so long and hard to achieve and Camden may reclaim its former reputation as a vibrant center of commerce.
EVAN ZWEBEN is a Senior Vice President of office real estate at Colliers International in Philadelphia. He specializes in the leasing and sale of office and medical properties in Southern New Jersey.
JOSEPH FETTERMAN is the Executive Vice President of Strategic Initiatives at Colliers International in Philadelphia.