With a new governor at the helm in New Jersey, and the Grow NJ program scheduled to sunset in mid-2019, the market is curious about the future of economic incentives in the Garden State.
So naturally, our colleagues in New York asked themselves what’s on the horizon for NJ incentives? We had a hunch that CRE leaders in Greater Philadelphia – especially those served by our Cherry Hill office – would be just as interested in the answer. According to JLL New York:
“Our expectation is that the existing Grow NJ program, which has provided among the nation’s most lucrative incentives in recent years, will be amended or replaced over the next eighteen months rather than extended in its current form.
We expect that incentives will continue to serve as a critical element in New Jersey’s economic development strategy, but it’s safe to say that changes of some sort will be on the horizon within the next year, and we will continue to monitor the situation closely. However, there have been no changes as yet, and nothing specific has been proposed by the new administration – we are told that it is “business as usual” at the NJEDA for the time being.
Among the many moving parts that will play a role in the evolution of New Jersey incentives in the coming twelve months:
- New Governor Phil Murphy (D) was critical of Grow NJ during his campaign, but significant changes to the incentives would require legislative action, and the program – from which a large majority of past awards have gone to urban, heavily Democratic communities such as Jersey City, Newark and Camden – has substantial Democratic support in the State Senate and Assembly. Murphy will need to work with the legislature to amend the program.
- Governor Murphy has instituted an “audit” of the Grow NJ program to take place over the next year. Our assessment is that this is designed to identify areas for possible amendment of the program, and the yearlong time frame does not suggest that changes are imminent.
- Governor Murphy is still staffing his administration. He’s named a Deputy Chief of Staff for Economic Growth and has nominated a new CEO for NJEDA, who could be confirmed by mid-February. These appointments may lead to more clarity as to the administration’s approach to Grow NJ in the short term.
When thinking about your real estate strategy for clients considering relocating to or within New Jersey, or expanding in the state, we recommend moving forward sooner rather than later with the application process if they intend to access Grow NJ. In an uncertain environment, we would recommend vetting applications in advance with NJEDA so as to identify any issues and make a well-informed decision before proceeding with the extensive application process. For the time being, however, Grow NJ represents an excellent economic opportunity for qualifying companies, and JLL’s Incentives team can help your clients evaluate, optimize and execute their opportunities in New Jersey.
For questions or inquiries, contact Dan Breen, Executive Vice President in the Business and Economic Incentives group.”
Adapted from the post “what’s on the horizon for NJ incentives?” originally published at http://newyorkblog.jll.com/.