Holmdel Joins Fight Against Apartment Proposal

Proposal for 6 apartment buildings (408 units) at 114 Nut Swamp Road

In April 2023, a builder, Adoni Property Group, filed a builder’s remedy lawsuit against Middletown and proposed to build 478 apartment units on two properties adjacent to the Memorial Sloan Kettering Cancer Center next to GSP Exit 114.

On Friday, June 9th, Holmdel Township announced that it filed to join as an intervenor in the lawsuit, citing an adverse impact by the high-density development proposal since the proposed developments are right along Holmdel’s border and could not be accessed without crossing into Holmdel.

“The developer’s proposal is unreasonable and violates sound land use planning,” said Holmdel Mayor DJ Luccarelli. “We are committed to fighting high-density housing proposals right along Holmdel’s border that would have a devastating impact upon our traffic, infrastructure, and quality of life.”

Mount Laurel Doctrine

In 1983, New Jersey Supreme Court ruled, in what is known as Mount Laurel II, that all municipalities are required to create a realistic opportunity for their fair share of affordable housing. The 40-year-old ruling also created a builder’s remedy lawsuit as a way to enforce the Mount Laurel Doctrine. Under a builder’s remedy lawsuit, a builder’s remedy may be awarded if a developer can demonstrate that the municipality has not satisfied its affordable housing obligation and certain other conditions.

In March 2015, another New Jersey Supreme Court ruling declared the then defunct agency Council on Affordable Housing (“COAH”) to be moribund and, essentially left the administration of affordable housing to be decided by an NJ Superior Court judge, the Fair Share Housing Center (“FSHC”), a nonprofit advocacy organization, and local municipalities.

The Tale of Two Townships

Like Middletown and other municipalities, Holmdel filed a lawsuit a few months after that 2015 Supreme Court ruling for “declaratory judgment” action that protected it from a builder’s remedy lawsuit and allowed it time to work out an agreement to satisfy the latest round of affordable housing obligations. Holmdel reached an agreement with FSHC in January 2019. A judge approved the agreement and granted a court order that protects Holmdel from a builder’s remedy lawsuit until the next round, which will start in July 2025.

Middletown, in what was considered to be a bold move, decided in July 2019 to withdraw from its court proceeding citing that FSHC was unreasonable in its proposal for affordable housing obligations. Some predicted and feared that this could leave Middletown susceptible to builder’s remedy lawsuits. It took about four years but it looks like this might come home to roost.

There is no question that 478 apartment units on about 19 acres is a very high-density residential development and goes against sound planning principles and objectives for suburban towns like Middletown and Holmdel. In response to the builder’s remedy lawsuit, Middletown’s Township Committee is seeking to acquire the two undeveloped properties, including the possible use of eminent domain, and preserve the land as open space.

State law allows municipalities the use of eminent domain to take private property (for “just compensation”) and convert it into public use including a park.

It will be very interesting to see how this plays out in the legal proceeding and whether a judge will allow the use of eminent domain in direct response to a builder’s remedy lawsuit.

Stay tuned.