As everyone has seen, the economic times has slowed the LumberYard Project.  A combination of the “worst housing recession in the history of the world” and the credit crunch affecting the banking world, have caused the project to take longer than originally planned and have stalled the completion of the Atlantic Avenue building.  The half of the Atlantic Avenue building closest to Collings Avenue has, in essence, had eight of its units sold twice.  Eight units were sold for the first time immediately after the Haddon Avenue building sold out, but the recession came upon us and those sales were lost because of job loss, one death, and slowed construction  due to frozen credit.            

    For the last ten months, we have been working on restructuring all aspects of the project.              

        1. Restructuring the sales efforts.  An in-house sales team was replaced in early spring of this year with Main Street Realty.  Pat Ciervo and the crew of Main Street Realty have established a firm grip on the Collingswood market and their sales associates are bringing a new life to the sale and marketing of units within the LumberYard.  The sales office was moved to a model within the Atlantic Avenue building.  New marketing materials have been developed, with a new look and a new direction of focus through new media and new markets.  These efforts, helped with Federal housing tax credit assistance that resulted in nine sales in 2010.          

         2. Restructuring the project phases.  There is one remaining phase for the originally planned LumberYard Project.  This last phase called for a residential building constructed on the other side of Powell Lane.  With the current status of the residential housing market, we have over the past nine months been exploring conversion of that building into a commercial building with offices on the upper floors and retail and professional space on the first floor.  We are currently in discussions with two regional businesses for the construction of this building which would include the relocation of their offices into the location at Powell and Haddon Avenue.              

        The construction of this last phase as a commercial property would actually add to the mix of uses at the LumberYard Project and along Haddon Avenue, providing an additional source of customers for our businesses and additional ratables to help provide some property tax relief. We are hoping to have some conceptual plans for this reworking of the last phase soon.            

        3. Restructuring construction financing.  Within the parameters of the housing recession, the worst effect has been in the credit crunch throughout the banking industry.  The LumberYard’s construction financing has always been through the Thrift Institutions Community Investment Corporation of New Jersey which is a consortium of commercial banks throughout the State of New Jersey.  The lead bank in this project has been Sun Bank.               We have gone through months and months of evaluation, review of status and prospects of the project and the need for an infusion of additional capital to complete the second half of the Atlantic Avenue Building and are close to reaching a final agreement with the banks.            

    This restructuring of the construction financing will require the Borough to make an additional investment in order to match bank financing that will allow the completion of the brick façade on the remaining half of the Atlantic Avenue Building and finally open the public parking garage.  The final amounts, timing of investment and details of the next steps of the project are expected to be finalized in the coming weeks.              

        4. Overall status.  With the harsh budget times we have just completed, we are acutely aware of the need to complete this project without placing any additional burden on the Collingswood taxpayer.  We are working on a method whereby the additional tax revenue generated from the completion of the units at the LumberYard Project will be dedicated - in a type of lock box - toward any additional investment commitment required of the Borough to complete the project.            

        Even with these harsh economic times that have befallen this project, we expect this project to generate tax revenues to cover its expense and to provide property tax relief through the new municipal and school taxes it will generate over the years to come. The LumberYard’s long term benefit to our community is huge in bridging the downtown, welcoming new neighbors and ratables and bringing commerce to the Borough.