Investing in a Hub for Entrepreneurs at Kearny Point

This story is highlighted in Capital One’s 2019-2020 Corporate Social Responsibility report. To view the full report, click here.

Economic change invariably produces pockets of decline, but across the United States, revitalizing underused or abandoned industrial and military spaces are major socio-economic and environmental opportunities waiting to happen. Kearny Point – a former World War-era shipyard on a 130-acre brownfield site along New Jersey’s Hackensack River – is being transformed into one of the largest and most economically significant redevelopments in the region, thanks in part to $14.5 million in New Market Tax Credit (NMTC) loans from Capital One and New Jersey Community Capital (NJCC).

This mission-driven redevelopment project is preserving a historically significant site. Capital One is proud to be a part of this forward-thinking investment in diverse, entrepreneurial ingenuity. Finding opportunities to support community beneficial revitalization projects has been part of Capital One’s quest to help local organizations take steps towards resilient development. 

During World War I and II, the Federal Shipbuilding and Dry Dock Company operated Kearny Point and employed thousands of people. In modernity, property redevelopment is helping to revive job opportunities in the area based on a climate resiliency model. Kearny Point offers a welcoming and inspiring home for businesses that are working to develop and commercialize technologies and services that advance energy conservation, alternative energy, resiliency, storm water management and preservation and restoration of precious natural resources, as well as dozens of varied small businesses.

“Most people know of that area in their respective community that may have been booming at one point but that is now a source of blight,” says Mitchell Hart, a Vice President at Capital One who worked on the transaction. “By restoring these sites, we have the ability to bring vibrancy and jobs back to areas that were long forgotten.”

The new Kearny Point is anchored by the Building 78 small business incubator, a 160,000 square foot adaptive reuse of a historic-four story warehouse building. It features flexible office spaces, co-working and light industrial space. In total, Kearny Point has reactivated more than four million square feet of flex and industrial space.

Adjoining Building 78 is The Annex, which features two floors of state-of-the-art creative office space, modern amenities and break-out areas in a naturally lit crane way. The Annex's office space caters to small businesses and start-ups, including many minority- or women-owned businesses and nonprofit organizations – all part of Kearny Point's community of creators, cleantech disruptors and small businesses. Within the walls of The Annex, entrepreneurs are given a stable place to tap into a meaningful channel of economic opportunity and further the growth of their socially beneficial businesses. Stringent operational changes in 2020 have since meant that Kearny routinely cleans and maintains its grounds.

The NMTC loan package to Hugo Neu Group, a mission-driven private redeveloper, was led by Capital One and included a $4 million allocation from Capital One Community Renewal Fund (COCRF). The loans are funding the construction and rehabilitation of The Annex, which is the third structure to be transformed as part of Hugo Neu's multi-phase $1-billion redevelopment of the former shipyard.

The NMTC program is a federal initiative that encourages investment in lower-income communities with a modest tax credit that provides an incentive for development. Authorized under the Community Renewal Tax Relief Act of 2000, since 2003 more than $50 billion in NMTC investments have been made, leveraging more than $100 billion in total capital investment to businesses and revitalization projects in communities with high rates of poverty and unemployment.

“What’s happening at Kearny Point is a terrific example of how New Market Tax Credits can be used to make worthwhile projects with a strong community benefit a reality,” says John Chamberlain, a Managing Director at Capital One who worked on the transaction. “The work being done in New Jersey can help other communities think about ways in which abandoned or underused sites in their own communities could be reimagined.”

 

Capital One is on a mission to change banking for good. To be authentic and impactful, our goals for our customers, associates and our communities must be clearly linked. Our 2019-2020 Corporate Social Responsibility Report illustrates this commitment. Learn more about Capital One’s commitments, here.