Economy stalls ‘science park’

Eastern Properties, a real estate company based in Cranbury, has decided to move forward with the construction of the complex at a slower pace because of difficult economic circumstances, Princeton Forrestal Center director David Knights said.

The planned development, called Science Park at Princeton Forrestal, will be located on the west side of Route 1, north of the Forrestal Village shopping and office complex.

The souring national economy has played a major role in the delay, Knights explained, adding that the University does not intend to sell the land to Eastern Properties until the company appears ready to develop it.

“We never sell any land until the developer has everything lined up,” Knights said.

Princeton Forrestal Center, a branch of the University that manages and develops land along a stretch of Route 1 southeast of the main campus, purchased the land that Eastern Properties plans to develop in 1986, Knights said.

Eastern Properties president Joseph Stern and his son and partner, Zev Stern, declined to comment, citing a policy of not speaking to the media.

South Brunswick Mayor Frank Gamabatese said in an interview with The Newark Star-Ledger that a development plan approved by South Brunswick Township requires the University to begin development of the property by December 2009.

Gambatese explained that the proposed development would generate $5 million annually in property taxes for South Brunswick.

While Knights expressed confidence that Eastern Properties would eventually follow through on the development, he cited expensive credit and a cautious business atmosphere as reasons for postponing construction.

“They’re a father and son team. They’re fully committed, but they haven’t gotten to where they are by being great risk takers,” Knights said.

The national lending crisis has driven up interest rates, making it difficult for the developers to borrow money to finance projects, he noted.

“Many developers with projects that are further along than this one can’t get money at all,” Knights explained. “There’s a total freeze on construction lending and mortgage financing.”

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In addition, Eastern Properties has encountered difficulty finding tenants for the proposed development because fewer companies are moving to new office space.

“Many, many companies are just really operating at a very slow pace and not expanding,” Knights said.

Though the Star-Ledger characterized the proposed development as “a science research campus” that would be built for the University by Eastern Properties, Knights clarified that the new construction would be a “commercial development” and would be owned entirely by Eastern Properties, not managed on behalf of the University. Editors of the Star-Ledger could not be reached for comment.

“Eastern’s going to build these buildings and rent them to commercial users,” Knights said. “It’s very different than a chemistry building on Washington Road.”

Tenants at the complex will likely include pharmaceutical, microelectronics and biotech companies, Knights explained, adding that “a bank operation could easily go in one building.”

The Star-Ledger reported that plans for the development include two hotels, seven laboratory buildings and an office building.

Eastern Properties intends to build 10 buildings in total, Knights said.

While the economic downturn is affecting area developers, University Provost Christopher Eisgruber ’83 said at a Council of the Princeton University Community meeting on Monday that he did not think that the slowdown would derail construction projects in Princeton’s 10-year Campus Plan.

“As you know, all this takes place at a time when the University is in the midst of its Aspire campaign,” Eisgruber said at the meeting. “That campaign continues to go forward with enthusiasm. Yes, there are headwinds, there are challenges, but this is a marathon, not a sprint.”