Over the weekend I read this story in the Star Ledger and I began to think about how many property owners I know that are in the same situation. This scenario may be repeated by the New Jersey School Construction Corporation ("NJSCC") who acquired numerous properties to build schools throughout New Jersey. However, due to funding issues, some NJSCC school projects have been put on hold and it is questionable whether all of the schools will be built. If not, NJSCC will own property which may ultimately be re-sold and the original property owners will have no recourse.
Courts look at the proposed public purpose at the time of the taking to determine whether the taking is constitutional. However, most governmental takings are political in nature and subject to changing administrations and funding availability. In addition to governmental uncertainties, the economic climate may also impact construction projects, especially redevelopment projects. There are numerous redevelopment projects on the drawing board throughout New Jersey which are at various stages of planning and implementation. If housing demand drops, it is questionable whether redevelopers will seek to complete projects immediately, or look to delay the construction until the housing market improves. The recent bankruptcy filing by Kara Homes may be a telling sign.
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