1. David Fisher, PP, AICP
Vice President, K. Hovnanian Homes
March 1, 2013

2. Overview
• Background on State Planning
• Policy Emphasis & Redevelopment Focus
• Changing Demographics
• Trends in Housing Preferences
• Housing Product to Meet Future Demand
• Challenges

3. State Plan Background
State Planning
First attempt to create some type of
state planning authority came in 1934
when Governor A. Harry Moore
established a temporary state planning
board. In May 1934, the first State
Planning Act (P.L. 1934, c. 178) was
passed.
Modest efforts ensued for many years
until the late 1970’s when the NJ Dept
of Community Affairs prepared the first
real comprehensive plan, known as the
1977 “Preliminary Draft” State
Development Guide Plan.
Courts began to give credence to Draft
Guide Plan by tying affordable housing
compliance to areas identified in this
document for growth.

4. State Planning Commission
Established by 1985 State Planning Act along with Office of State Planning to
prepare state planning documents, and to manage implementation and
municipal ‘cross-acceptance’ of the Plan. Leads to adoption of first “State
Development and Redevelopment Plan” in 1992.

5. State Planning Commission’s
Office of State Planning later
becomes Office of Smart Growth
(moves from Dept of Treasury to
NJDCA)
Plan update and 2nd round of
cross-acceptance takes place
2nd State Plan adopted (2001)
Preparation of third draft Plan
released in 2004; cross-
acceptance process begins again,
but stalls …. little progress for
many years

6. New State Plan Vision
• Abbreviated (40 p.) State Plan
document simplifying state policy
guidance for investments in growth,
infrastructure and environment.
• Creates 4-tiers of ‘investment areas’:
~ Priority Growth
~ Alternate Growth
~ Limited Growth
~ Priority Preservation
• New emphasis on ‘Industry Clusters’
• Highest Priority Growth targeted for:
former PA-1 areas; urban centers;
UEZ’s; Redevelopment Areas; Transit
Villages; higher educ campuses; and
other areas key to important
industries
• State Strategic Plan yet to be adopted

7. Not Much Difference
1977
2001…

8. What’s left?
Planning Areas 1 and 2 and a
dozen or so designated
‘Centers’
… minus areas being removed
from local sewer service areas
by NJDEP through amendments
to Areawide Water Quality Mgt
Plans (WQMP’s)
RESULT: Less land for
development; greater focus on
redevelopment and infill.

9. Demographic Realities …. Future Growth Sectors
• Eco-boomer’s (children of baby-boomers) in mid-20’s to early 30’s
• Aging baby-boomers / move-downs … smaller homes; near children
• Foreign-born populations (Hispanic, Asian, Indian, etc.)
STATISTICS
• Birth rate in U.S. continues to fall … in 2011, we produced the lowest number (less than
4 million) since 1998. Nationwide, birth rates have been declining since a peak of 4.3
million in 2007.
• According to the Census, over the past four decades
while total population in NJ increased (from 7.1 to 8,7
million), the school-age population has declined by
more than 270,000 students during that period.
• Whereas in 1970, the number of
school-age children represented
25% of the total population, by
2010 that percentage had
dropped to 17.3%.

10. Changing Demographics
Fewer households with children … dependent on market and locational variations
Source: Otteau Evaluation Group, 2012

11. NYC v. NJ … a Reversal in School Kids
• Young and middle-age NYC couples Bergen County – school enrollment losses
and singles with children less likely to
move to NJ suburbs for schools.
• North Jersey (non-urban) towns
experiencing reductions in school
enrollments
Bergen Co. Towns 2000 2010 % drop
Norwood 320 214 .33
Harrington Park 344 193 .44
Franklin Lakes 703 435 .38
Wayne 3,313 2,458 .26
Ringwood 935 689 .26
MED. HH INCOMES Source: The Record,
2/17/2013, staff writer
> $125,000 David Sheingold.
$100 – 124,999
$80 – 99,999
$65 – 79,999
< $65,000

12. Increased Demand for Convenient Locations
• Fewer Young People Want Cars: In 1995, people aged 21-30 accounted for 21% of
all miles driven. In 2009, that number fell to 14%.
• Walk-ability Creates Value:
Homes in walkable urban
Percent of Homebuyers Wanting to Walk to:
neighborhoods experienced
80% less than half the decline in
70%
home prices (since 2006) as
60%
50% compared to other
40% traditional/suburban locations.
30%
20% Sources: Otteau Evaluation Group &
Brookings Institution, 2011
10%
0%
Source: National Association of Realtors, 2011

13. N.J. Residential Permits & Multi-family Segment
(1980 – 2012*)
Source: Patrick J. O’Keefe, Jan 2013

14. N.J. – Household Characteristics
Adjustments in Household Composition Alters Outlook and Demand for New Housing
Source: Otteau Evaluation Group, 2012

15. Buyer Profile
~ Seeking ~ Active ~ ~ Traditional ~ Affluent ~ Semi to ~ Middle ~ Wealthiest
pure, basic young Active, laid middle to families, olde fully retired class adults of active adult
housing professional back middle middle- r couples lower- nearing or in segments
singles & class singles upper class middle class retirement
~ adults ~ Middle to
~ Price is key couples, care or couples & families
Privacy, prest ~ upper class
er focused families ige and
~ Prefer mid- ~ Mixture of Locations, fe adults w/ eye
~ Lower upper- features
~ High rate sized ethnically atures and on retirement
income middle class important and racially community
segments professional of home- suburban ~
diverse; feel is
ownership homes ~ Custom Community, s
strong ties important
~ Desire ~ Adaptable often in tastes, countr ense of place
~ High home to and ability to
home- will sacrifice rural areas y club communities is important
ownership w/ remain active
ownership bdrms for preferences and
features; ~ Affinity for strongest ~ Motivated ~ Very active
but often traditions
price outdoor affinity ~ Demand to downsize and social
credit
focused on sports, rec toward new high-end ~ Only likely and have lifestyle
challenged finishes;
technology activities homes and to move to maintenance
communities many options downsize or ~ Stylish
& style -free lifestyle
~ Not locate features, new
~ Values traditionally ~ Home ~ Variety of closer to ~ Consider a construction,
career features and product, yet retirement community
convenience family
focused community location and purchase feel are all
over price size both
feel are their final important
important
important home

16. Buyer Profile

17. Affordable multi-family townhomes
Bayport
(West Atlantic City, NJ)
Whispering Pines (PA)
Delaware Run
(Trenton, NJ)

18. Mid-priced Townhouses (Infill)
Hartland Square
(North Brunswick, NJ)
The Ivy (Shrewsbury, NJ)
Providence Corner (PA)

19. Redevelopment - Condominiums
Morris Place
(Morristown, NJ)
Station Square
(Union Twp, NJ)

20. High-end Waterfront Condo’s
Grandview at Riverwalk
(West New York, NJ)

21. Mid and High-Rise Flats
77 Hudson
(Jersey City, NJ)
Port Imperial
(W. New York and
Guttenberg, NJ)

22. Oceanfront (Redevelopment) Multi-family

23. Active Adult SFD
Still in demand for right price / amenities
Four Seasons at Harbor Bay
(Little Egg Harbor, NJ)
Four Seasons at Manalapan (Manalapan Twp, NJ)

24. Multi-family Age Restricted Housing
Four Seasons at Ridgemont
(Montvale, NJ)

25. Broad Offering of Housing Product

26. Challenges
• Matching housing value/price to market demand … Can we make it
affordable enough to attract larger demographic groups/buyers?
• Overcoming redevelopment impediments:
 Acquisition issues … complications of condemnation
 Environmental remediation
 Cost of labor (prevailing wage)
 Condition of sewer, water, stormwater infrastructure
 Traffic improvements
• Securing incentives to acquire, remediate and/or improve properties to
create opportunities
• Finding properties with manageable environmental liabilities/clean-ups
• Managing costs for infrastructure and site development
• Financing challenges for land acquisition and for home-buyers
• Need for property tax relief in certain cities/towns (PILOT?)

27. Thank You!
For information contact:
David B. Fisher, PP, AICP
Vice President – Governmental Affairs
K. Hovnanian Homes
110 Fieldcrest Avenue, 5 th Floor
Edison, NJ 08837
(732) 225-4001
dfisher@khov.com