77 Hudson Street

[MCA]

Hovnanian Will Soon See Outcome Of High-Stakes Hudson Gamble
June 10, 2009: 03:23 PM ET

NEW YORK (Dow Jones) - Hovnanian Enterprises Inc. (HOV) is about to learn if its high-rise gamble pays off.

Back in the boom, the home builder launched its biggest tower, a 48-story, 420-unit condo tower in Jersey City, N.J., offering Big Apple views just feet from the Hudson River.

But the market deteriorated dramatically during construction, and, with closings expected to start within the next month, it's likely some contracted buyers won't make it to the closing table. That could mean cancellations and fights over deposits as the company - which has seen 11 consecutive quarterly losses and its shares plunge by more than 60% in the 12 months - works to unload inventory in an ailing market battered by financial turmoil.

What's more, Hovnanian can't turn the project into a rental tower, said Marty McKenna, spokesman for Equity Residential (EQR), which is finishing and seeing strong demand for 480 apartments that share common areas including the pool deck and the parking garage with 77 Hudson.

Red Bank, N.J.-based Hovnanian, the nation's sixth-largest builder by annual closings, could be preparing itself. In its recent second-quarter results, the market came up as it discussed its eye-popping land-related charges of roughly $ 319 million.

"Impairments in the Northeast are due to recent weaknesses in this market primarily in the suburbs of Manhattan, which is a direct result of recent increases in unemployment in that market, especially as it relates to Wall Street," the company said in its June 3 conference call. " ...The New York City market held up much longer than other markets during this downturn, but with the perils of the financial market sector that really hit home in the fall of 2008, the declines in this market have occurred rapidly."

Like most builders, the company does not break out impairments by community.

Hovnanian did say that it recorded $8.7 million of write-downs associated with its investment in joint ventures, which show up on the income statement's loss from unconsolidated joint ventures line. "This joint venture where we had a write-down is in New Jersey and is also on the Hudson River waterfront with views of Manhattan," said Chief Financial Officer J. Larry Sorsby in the earnings conference call.

Hovnanian previously said Strategic Real Estate Advisors advised a joint-venture partner on the project, where prices now start in the $300,000 range. Hovnanian would not reveal the partner. It does, however, have a second joint venture on the Hudson, and would not say Wednesday if this impairment was for 77 Hudson.

Hovnanian isn't the only home builder better known for single-family construction selling condos in this Garden State market. Toll Brothers Inc. (TOL) just announced that, at its 12-story, 230-unit 700 Grove project in Jersey City, buyers can get in for 3.5% down - as little as $17,500 - through new Federal Housing Administration qualified loans.

"FHA is a big selling point," said Ben Jogodnik, senior vice president for Toll's City Living division in Hoboken and Jersey City.

The development is more than 85% sold and closed, making it eligible for loans guaranteed by government-backed mortgage agencies Freddie Mac (FRE) and Fannie Mae (FNM), he added.

In March, Hovnanian said 77 Hudson was not eligible, but it was offering competitive rates through various partnerships.

It could not say Wednesday if that has changed.

By Dawn Wotapka; Dow Jones Newswires

[MCA]

From the WSJ:

Hard Times for Hovnanian’s Jersey City Condo
By Dawn Wotapka

During the boom, home builder Hovnanian Enterprises Inc. launched its biggest tower, a 48-story condo showpiece in Jersey City, N.J., offering Big Apple views just feet from the Hudson River. Now it’s set to debut in an environment gone bust.

The address remains prime, but nearby Wall Street’s continued turmoil is feeding the region’s unemployment, affecting many purchasers and depressing sales and prices. Foreigners, long a key buying group, are battling what has become a worldwide economic crisis.

That could mean unsold units, an elevated cancellation rate and fights over deposits at Hovnanian’s 77 Hudson project, expected to start closings in the late spring/ early summer. (more)

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Towering $877G fine for 'unsafe' worksite
Friday, June 20, 2008
By PAUL KOEPP
JOURNAL STAFF WRITER

Federal regulators have proposed $877,000 in fines against a concrete contractor at a Downtown Jersey City high-rise construction site where a worker fell to his death in March.

The federal Occupational Safety and Health Administration cited Manhattan-based Broadway Concrete on Wednesday for a multitude of safety violations at 77 Hudson St., a condominium building planned to climb to 48 stories.

In March, a 31-year-old Queens man working as a plasterer died when he fell from the 25th floor of 77 Hudson and landed on the roof of an attached parking garage about 14 stories below.

Last October, a four-alarm blaze engulfed the 17th and 18th floors of 70 Green St., which is connected to 77 Hudson by a parking garage.

OSHA started investigating the company last December after a complaint of hazardous conditions at the site that could lead to falls.

On seven visits over a month, investigators found that Broadway Concrete did not have proper protection to keep its workers from falling from as high as 25 stories, even though the company was warned at each inspection of the safety rules it was breaking, according to an OSHA press release.

The problems included a lack of guard rails, improperly built scaffolds, unguarded utility holes and protruding rebar, said Department of Labor spokeswoman Leni Fortson.

In all, Broadway Concrete racked up 15 "willful violations" totaling $870,000 in fines and two "serious violations" for another $7,000.

Broadway Concrete's site superintendent at 77 Hudson and its vice president were managers at other concrete companies that had violated the same standards, OSHA officials said.

"The many alleged safety violations found at Broadway Concrete's site put employees at great risk for potential injuries or death," said Edwin G. Foulke Jr., assistant secretary of labor for OSHA.

Broadway Concrete owner Robert Cassera, who also owns Tri-State Employment Services, could not be reached for comment. He has 15 business days to contest the penalties.

Calls to the site's general contractor, Hunter Roberts Construction Group, and to the developer of 77 Hudson, K. Hovnanian Homes, were not returned.

[MCA]

From Multi-Housing News:


New Condo Complex Sets City Record for Penthouse Sales

Published: August 13, 2007
By Kelly Sheehan, Online News Editor

Jersey City, N.J.—K. Hovnanian Homes has sold two penthouse condominiums to one buyer for $6 million. The units are part of 77 Hudson, a new condo complex located in Jersey City, N.J.

The sale sets a new record price for a penthouse sold in the city. The penthouses, on floors 48 and 49, total 4,188 square feet.

Designed by New York-based architect firm Cetra/Ruddy, the community is currently under construction and is slated for completion in May 2009. Upon completion, it will feature 420 condos.

Units are priced from the $500,000s to $3 million, and they will include floor-to-ceiling windows as well as washers and dryers. About three-quarters of the residences will feature views of Manhattan’s skyline.

The community will feature a glass curtain wall façade, and will feature amenities such as a roof deck, dog park, pool, fitness center, café, lobby with art gallery, community lounge, game room, private dining room, screening room, virtual golf area, business center, barbeque area, hot tub, jogging path, massage room, yoga and Pilates studio, sauna and steam rooms, and party room. Residents will also have access to concierge services, state-of-the-art security systems, Wi-Fi in public areas and grocery delivery services.