Kushner Nabs $415M for New Jersey Mall Redevelopment

The Monmouth Mall in Eatontown, N.J., will become the latest U.S. enclosed mall to be redeveloped into a mixed-use property, now that owner and developer Kushner Cos. has secured $415 million in construction financing.

The New York-based firm is planning to transform the 1.5 million-square-foot enclosed mall into Monmouth Square. The redevelopment is expected to take four to five years to complete.

The construction financing for the $500 million project is comprised of two key loans. Funds managed by affiliates of Fortress Investment Group will provide $303 million in financing for the residential component. For the redevelopment of the retail section, Rithm Capital issued a $112.5 million note, which will be managed by its operating partner, GreenBarn Investment Group.

Kushner acquired the asset at 180 State Route 35 in October 2002, according to CommercialEdge data. Previous financing included a $65 million loan from AIG originated in 2021, the same source shows.

READ ALSO: Why Mixed-Use Developments Are All About the Right Synergies

Upon completion, the open-air town center will feature 900,000 square feet of retail, restaurant, and medical office space; 1,000 apartments of which 125 units will be affordable, and public green spaces and pedestrian pathways.

The residential component will feature a 40,000-square-foot clubhouse with a fitness center, spa, cafe, coworking space, media room, library, pickleball and basketball court, golf simulator, children’s room, and pet spa. The retail part of the project will include 990,000 square feet of space, anchored by a Whole Foods Market.

Redevelopment plans

Located off Route 35, less than 1 mile from the Garden State Parkway, the initial 600,000-square-foot shopping center opened in 1961. The mall was enclosed by 1975, when 900,000 square feet were added to the center.

Kushner broke ground on Monmouth Square in early May with initial work currently underway to demolish about 600,000 square feet of the retail space at the mall, thus reducing the footprint for that component by 40 percent for the new project.

Lord & Taylor, vacant since 2018, was the first department store to be razed on the 79.8-acre site under the new redevelopment plan. JC Penney, which closed in 2022 as part of the retailer’s shift to an online marketplace, will also be demolished. Whole Foods Market will move into the space currently occupied by Barnes & Noble, which will relocate to a new building in the town center. The remaining retailers, including AMC movie theater, Macy’s, and Boscov’s, will remain open during construction.

The project is already 82 percent pre-leased to a diverse set of tenants across a range of industries. BOND Retail Partners is managing the retail leasing strategy. Architectural design for the project is being led by Minno & Wasko Architects and Planners, Benoy, and the Dietz Partnership.

Earlier Kushner projects

Plans to redevelop the Monmouth Mall date back to at least 2017, when Kushner formed a joint venture with Rouse Properties to renovate the shopping mall into The Heights at Monmouth, which was also slated to be a mixed-use destination. That version proposed adding a mix of shopping, dining, entertainment, leisure and daily-use providers as well as residential space and public areas to create a community environment.

Kushner previously teamed with Extell Development to expand Pier Village in Long Branch, N.J., which now has more than 130,000 square feet of retail space and restaurants, luxury apartments, upscale condos and a hotel. Extell eventually sold its stake in Pier Village to Kushner.

The company’s portfolio includes residential, commercial, retail and hospitality assets. The firm has about 10,000 apartments under development and more than 27,000 apartments under ownership in 14 states.

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