Paterson NJ Art Factory renovation project secures $ 12.5 million loan
PATERSON – The massive renovation of the Art Factory, a 19th-century factory complex near the Great Falls, will continue with a $ 12.5 million loan, according to the owner of the property.
The project, which would include shops, offices, and arts-focused exhibition and production areas, was at a standstill after another lender changed its mind last May on financing the works, said David Garsia, owner of Art Factory.
But two Bergen County-based private groups, Silver Arch Capital Partners and Procida Funding & Advisors, have agreed to give Art Factory a one-year bridging loan, the lenders said recently.
“Art Factory Studios is not a straightforward office park,” Procida said in a press release. “This is such an exciting property with so many different purposes that can be too complicated for conventional lenders to even think about.”
Mayor Andre Sayegh praised the project as part of his plan to make Paterson “a city of renaissance”.
“A sturdy art factory will only add to Paterson’s artistic appeal,” said the mayor.
Several dozen artisans, including film production crews, have been using the Art Factory studio space on Spruce Street for several years. But the current improvised character of the complex has been a source of controversy.
In 2015, city officials shut down the art factory for fire safety violations days before a Christmas party was planned for hundreds of people. The city allowed the studios to reopen after improving fire safety, including sprinklers.
After that, Paterson officials issued Garsia and his tenants over 150 summons alleging they did not have proper occupancy certificates. These cases are pending before the municipal court.
These disputes arose when Jose “Joey” Torres was mayor. Under Sayegh, the city took a more cooperative approach to the Art Factory.
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Garsia said the development of an arts center just down the street from Great Falls National Park offered a unique opportunity.
“We are creating a destination that is unlike anything else in the world,” said Garsia.
The complex contains 21 buildings with 280,000 square feet of space on a five-acre site, Garsia said.
After the one-year bridging loan, Garsia said he plans to seek conventional financing to repay the two Bergen County lenders and to cover the remainder of the cost of the renovations. Silver Arch Capital and Procida are providing a team of marketing and development experts to help the project move forward, Garsia said.
As collateral for the loan, Garsia said he was using the Spruce Street site as well as an industrial property he owns on Totowa Avenue near School 5.