In an effort to address the negative consequences stemming from vacant, abandoned and other troubled unused properties, New Jersey recently passed legislation that allows for the creation of land banks. Under the Land Bank Law the State will allow municipalities to designate single entities to acquire, maintain, and convey, lease and otherwise dispose of vacant, abandoned and problem properties in order to carry out strategies to ensure the reuse of the these properties. These entities, known as the land bank entities, can be a public entity such as a redevelopment company or a non-profit entity seeking to acquire land for a charitable cause.
Municipalities and land bank entities, under the Law, are able to enter into a land banking agreement which will allow the latter to act on behalf of the municipality and hold, maintain, and lease or convey property owned by the municipality and not needed for any public purpose. This agreement shall establish the responsibilities of the land bank entity and shall specify the terms and conditions for the acquisition of property, its demolition and subsequent redevelopment, and its later conveyance. The agreement shall also provide for such municipal oversight of the land bank entity as the municipality deems necessary and appropriate and shall prescribe how any costs and revenues, including proceeds of the sale or leasing of land bank property, shall be distributed. The land bank entity may not lease any land bank property for a term of more than 99 years.
The idea behind the land bank approach is to create an incentive for individuals and municipalities to re-invigorate underperforming properties. It is hoped that the concept will aid in the redevelopment of land which has not benefitted from already existing laws. It may also provide an advantage to certain individuals or companies who can take advantage of the development of underperforming lands. If you believe you or company may be just so suited, please contact the lawyers at Lavery, Selvaggi, Abromitis and Cohen to discuss.