Things didn’t go their way during a grueling year of hearings before the Morristown planning board.
But the would-be developers of 126-136 South Street made out okay in the end.
They have sold a one-acre tract next to the historic Vail Mansion for $6 million to the AHS Investment Corp., a subsidiary of Atlantic Health, parent company of Morristown Medical Center.
That’s about $2.2 million more than they paid for the horseshoe-shaped property in 2016 and 2017, records show.
Their plans for 29 apartments (including four designated as affordable) and ground-floor retail were approved in January 2022; construction has not started.
The deal with Atlantic, first reported by Morristown Green in December, closed last month. Eric Witmondt of Woodmont Properties signed off on behalf of two Delaware-registered LLCs, 126 and 136 South St., representing the developers.
Asked if its acquisition would be used for housing executives and top staff, Atlantic Health only would confirm the purchase.
“While the timing of the plans for the mixed use development of the property remain under internal discussion, Atlantic Health System is proud of its history as a collaborative partner with the greater Morristown community and looks forward to remaining an important part of the health and well-being of local residents and the continued growth and support of the local economy,” Atlantic spokesperson Karen Zatorski said Monday in a statement to Morristown Green.
The developers spent about five years creating and pitching the project, revising their plans at least 15 times for the planning board, according to their attorney, Frank Vitolo.
But they were rebuffed in their attempts to tap a “density bonus”–a quirk in the town’s zoning–to wedge in 10 more units. The bonus was meant to encourage downtown development by awarding extra units to builders on parcels below one acre.
To squeeze under that cutoff and secure the density bonus, the developers tried offering 652 square feet of their front lawn to the town, and later, to the state Department of Transportation. The DOT has jurisdiction over South Street.
The project also encountered opposition from Vail Mansion condo owners, and from the town Historic Preservation Commission.
It was rare pushback for savvy developers with successful track records in Morristown. Partners included Carl Goldberg, whose Roseland Property Co. teamed with Woodmont in the early 2000s to add 36 condos to the Vail Mansion.
The companies also developed the 40 Park condos and Metropolitan apartments near the Morristown Green, and the Metropolitan Lofts apartments on DeHart Street.
Morristown entrepreneur and philanthropist Finn Wentworth and David T. Welsh, co-founders of Normandy Real Estate Partners, also were members of the South Street consortium. Wentworth has built luxury condos on Maple Avenue.
Wentworth and Goldman also have worked closely with Morristown Medical Center over the years.
Goldberg is a trustee of the Foundation for Morristown Medical Center.
Wentworth is an Atlantic Health trustee who led a capital campaign that raised $106 million for Morristown Medical Center in 2016. The next year, he was in a joint venture that sold a portion of Giralda Farms in Madison to Atlantic Health for $18.5 million, for a rehabilitation center.
Correction: An earlier version of this story misstated the name of the developers’ attorney, Frank Vitolo.