New Vernon Equities acquires 17-acre site from Novartis

New Vernon Equities is building up its Arena complex in East Hanover, adding a 17-acre parcel newly acquired from Novartis.

The Morristown-based commercial real estate developer and investor announced the acquisition of 135 Route 10 Nov. 2. According to the firm, the 150,000-square-foot office building will be redeveloped for science and technology users.

“We are thrilled to become a part of one of Morris County’s premier sites and continue our focus on top tier science and technology property development,” Peter Gilpatric, head of development for NVE, said in a statement.

Regarding the repositioning efforts, NVE noted the strength of Morris County for serving smaller office, labs and light manufacturing tenants. With redevelopment work already under way, Gilpatric told NJBIZ in a statement that the property is actively being marketed.

NVE’s Arena is centered on, now, three East Hanover buildings. Gilpatric said the firm envisions the campus as a more than 200,000-square-foot 21st Century workplace with a focus on science, technology and innovation.

New addition 135 Route 10 is complemented by 30 and 31 Farinella Drive. The former is a 75,000-square-foot biopharmaceutical manufacturing facility fully leased to GenScript ProBio, according to NVE. Currently under development, 31 Farinella Drive is expected to deliver 50,000 square feet of high tech/science space by the end of 2023.

In March, the East Hanover Land Use Planning Board voted to deny an application from Novartis to subdivide approximately 17 acres for sale at the corner of Route 10 and Ridgedale Avenue. At the time, New Jersey Hills reported that Novartis East Hanover Site Head Gregory Struckus said during the March 23 meeting that the company had entered into a memorandum of understanding with NVE for the property.

NVE declined to comment on the impact the denial had on the purchase process. In a statement accompanying news of the acquisition, Gilpatric spoke positively about its work with the municipality and the seller.

“Our strong working relationship with the Township of East Hanover Township and Novartis allows us to collaborate in making this part of the Township a work, play, learn hub for ideas and innovation within a 21st Century workplace,” he said.

Evolving needs

“Novartis continues to transform the East Hanover, N.J., campus to ensure we are using our office spaces as effectively as possible. As part of this initiative, we have divested an additional 17 of our 140 acres on the east side of the campus, including one office building,” the Swiss pharmaceutical giant told NJBIZ in a statement.

The transformation of the working space at Novartis’s East Hanover U.S. headquarters pairs with an “ongoing organizational evolution” across the company. At the end of the summer, Novartis disclosed plans to lay off 130 employees in East Hanover, which serves as its U.S. headquarters. That followed news from the end of 2022 that the company would cut 285 jobs at the site.

“Our efforts to transform the East Hanover campus are part of a multiyear, worldwide Novartis global initiative to improve and adapt work environments in many of our larger sites,”  Novartis added. “The work we are undertaking will also enable us to become more responsible with our footprint today and in the future.”

That idea was echoed by remarks Struckus made at the March planning board meeting.

“Like many other companies, we’re moving to a hybrid working model which offers better collaboration for our associates and provides our associates with more flexibility,” he said, as reported by New Jersey Hills. “But the new model also is a more efficient use of space. And therefore, we don’t require all of the buildings that we currently  have to accommodate our employees. And also by reducing our real estate footprint, it helps us achieve some of our energy and sustainability goals.”

Novartis shrunk that footprint by a sizeable amount in 2021 when a joint venture of Onyx Equities LLC and Russo Development acquired 62 acres from the company with plans to eliminate vacant office buildings in lieu of building up more than 800,000 square feet of industrial space at the site. Demolition was paused in April, with the partners, working as R&O East Hanover, announcing they would propose a smaller project, according to a report from the Daily Record.

Like NVE’s plans, the move would remove extra office space from the market and add more square footage in a sector with rising demand, particularly in recent years.

The post New Vernon Equities acquires 17-acre site from Novartis appeared first on NJBIZ.

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Author: Jessica Perry