Ridgewood resident and Onyx Equities Managing Partner John Saraceno in the Eye of the Political Storm Brewing over NJ Transit Two Gateway Center Lease

the staff of the Ridgewood blog

Newark NJ, following what NJ Transit called a competitive procurement process, the unanimous approval of its Board of Directors and authorization to proceed by the Office of the State Comptroller, NJ TRANSIT has renewed its commitment to the City of Newark and its customers statewide, signing a 25-year lease to establish efficient, modern offices in Two Gateway Center, with a direct pedestrian connection to Newark Penn Station, the state’s busiest intermodal transit hub.

“NJ TRANSIT’s new headquarters will provide a more efficient and collaborative workspace for NJ TRANSIT’s employees who design, build and operate our transit system,” said New Jersey Department of Transportation Commissioner and NJ TRANSIT Board Chair Diane Gutierrez-Scaccetti.

NJ TRANSIT’s 25-year Two Gateway lease includes approximately 407,000 square feet of space in open floor plates which will be built to suit. Two Gateway has just been newly renovated, and the lease allows the potential to expand or contract NJ TRANSIT’s footprint as needed.

Onyx Equities, the owner of Two Gateway, has agreed to provide $130 per square foot toward design and construction, currently valued at approximately $53 million, specifically to meet NJ TRANSIT’s needs and create a modern work environment, customized to maximize productivity and efficiency. The new, up-to

But not everyone in Trenton was so happy, Senate Republican Leader Anthony M. Bucco (R-25) and Senate Republican Budget Officer Declan O’Scanlon (R-13) sent a letter today to NJ TRANSIT President Kevin Corbett asking for documents related to the agency’s recent lease of office space in Gateway Center.

In the letter, the senators say, “When NJ TRANSIT officials have acknowledged that fare hikes, personnel reductions, and service cuts are on the table, we believe it is important to understand the decision-making process that supported a headquarters lease that appears to be unnecessarily expensive.”

The man in the center of the controversy is Ridgewood resident and Onyx Equities Managing Partner John Saraceno. Saraceno made his case to ROI-NJ  pointing out :

• It brings 2,000 NJ Transit employees into a Class A office building that is far superior to where they are now — one that literally is connected to Newark Penn Station;
• It brings NJ Transit to Gateway in 14 months — or far faster than other bids and far faster than what would have been expected for a deal this size;
• It provides incredible financial incentives — what Saraceno calls an unprecedented tenant improvement allocation package of $58 million on top of $15 million being spent for demolition of the space and a new HVAC system. This more than offsets the higher per-square-foot cost, he said.

Saraceno said, some connected the lease as a political payoff for a standard contribution he and his co-founding partner, Jonathan Shultz, made to Gov. Phil Murphy. Some members of the Legislature have started calling for an investigation and Saraceno claims he has become the “story” , instead of the lease .

Right now the financially struggling NJ Transit has become a very hot topic in Trenton and only time will tell whether there is and any fire to go along with the proverbial smoke . The key issues is once again the Murphy Administration kept details secret until well after the deal was signed , failing to include the legislator in this massive deal.

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