After years of delay, former Toys ‘R’ Us headquarters in NJ will be turned into housing

Seven years after Toys "R" Us declared bankruptcy, a deal to put a substantial amount of housing on the site of the company's former New Jersey headquarters is finally moving forward.

Town officials in Wayne Township this week passed an ordinance to rezone the property for residential use. That clears the way for the developer who purchased it from Toys "R" Us in 2019 to redevelop a substantial chunk of the 191 acres of land into 1,360 apartments, more than 200 of which will be affordably priced for low- and middle-income people. The town has a duty to develop about 500 affordable homes under a state mandate, but Wayne officials have waged a protracted battle with the state over how to fulfill this obligation.

The news comes after five years of negotiation between Wayne and the new owner of the land, Point View Wayne Properties, which has been trying to develop the area for years. The real estate development company met resistance from the township officials over its plan to build residential units, and negotiations were only able to move forward after Point View threatened to sue over Wayne's alleged "intransigent behavior."

A Passaic County Supreme Court judge on Oct. 1 ordered the township to rezone the property within 30 days so that construction could move forward. Following the 5-2 vote on Tuesday night, Wayne Town Council President Jason DeStefano told Gothamist that adopting the rezoning was the "right thing to do."

"I am happy we were able to get this done," he said.

But construction will only commence after several more bureaucratic steps, including more votes on the development plans by the Wayne town council and planning board.

'Under the gun' on housing

Wayne taking five years just to take the initial step of rezoning what's been a mostly dormant corporate site since the Toys "R" Us bankruptcy shows how some New Jersey towns are scrambling over their state obligation to provide affordable housing.

New Jersey next summer will begin the fourth round of its state-mandated affordable housing development under the Mount Laurel Doctrine, a 40-year-old state Supreme Court decision that says more than 500 towns across the state must contribute their fair share of low-priced housing in a series of time periods known as "rounds."

To prepare for the next round, which is scheduled to last 10 years, the state is providing towns this month with target numbers for how many affordable units it wants each municipality to develop. Towns like Wayne, one of the largest geographically in the state, could be asked to develop hundreds — or up to 1,000 — more affordable housing units over the next 10 years.

DeStefano confirmed to Gothamist that the hundreds of affordable homes earmarked for the former Toys "R" Us headquarters site would go toward satisfying units the town still owes for the prior Mount Laurel round.

At a town meeting on Oct. 1, Wayne Township's attorney Brian Chewcaskie indicated that officials were feeling the heat to make progress on the Toys "R" Us redevelopment. When asked by a councilmember why they had to "rush" to rezone the property, Chewcaskie said the town was "under the gun" to move forward with the project.

"We've been negotiating five years with them, and round three is coming to an end, and yes, we do have an obligation to provide for this housing — none of us like it, none of us do," said township Mayor Chris Vergano at the town council meeting this week.

Vergano and an attorney for Point View Wayne Properties did not respond to a request for comment for this story.

Some in Wayne believe the town shouldn't even be in the position where its officials feel pressure to fulfill their affordable housing obligation through what they see as overdevelopment. Councilmember Fran Ritter, a Democrat who voted against the rezoning, told Gothamist she had a "fundamental" issue with how Vergano's administration has handled the town's Mount Laurel obligations during the 16 years he's been in office. She said that instead of considering smaller, municipally-sponsored projects to satisfy the town's obligation, the mayor and his town planners have allowed large-scale housing development in Wayne to become a "boondoggle for developers."

"I wish that we could just create the units we need instead of making private developers rich," Ritter said.

A protracted battle

For the last decade, Vergano's administration has taken one of the state's most adversarial positions when it comes to fulfilling a municipality's affordable housing obligations. During the last Mount Laurel round, Wayne became one of only three towns in New Jersey to lose its immunity from what's known as "builder's remedy" lawsuits. This opened the door for any developer who wanted to build affordable housing in Wayne to be able to sue the town to build housing, even if town officials didn't want to approve the projects.

In 2020, after Wayne had failed for five years to put forward a plan to develop affordable housing the courts saw as viable, state Superior Court Judge Thomas Brogan ruled officials were acting in "bad faith" and with "concerted procrastination" to fulfill their Mount Laurel obligation. That ruling triggered several lawsuits from builders that have led to several large-scale apartment building projects getting greenlit in the town since 2020.

Point View Wayne Properties purchased the Toys "R" Us property for $19 million one year after the toy company declared bankruptcy. Two years later, the town reached a settlement in court with Fair Share Housing Center, a nonprofit that negotiates affordable housing plans with towns in New Jersey. As part of that settlement, the township agreed to continue its negotiations with Point View to develop the Toys "R" Us site.

DeStefano, the town council president, said he estimated the redevelopment would take "20-plus years" to be fully built out. Along with the housing, township planner Christopher Kok said during a presentation at the town council meeting that some of the property would be developed into a mixed-use "gateway" district with amenities including bars, restaurants and possibly a movie theater or bus station.

Moving forward, Wayne's town council has indicated it will continue its contentious approach toward the Mount Laurel Doctrine. In March, the council passed a resolution stating it would oppose a new state law passed in 2024 that laid out the guidelines for the next round of affordable housing development. DeStefano said at the time the law was "forced down taxpayers' throats."

"While I support the general goal of increasing affordable housing, I am deeply concerned about the state of New Jersey's approach," he said, adding that the most significant issue was "the lack of state financial support."

Councilmember Ritter, who abstained from the March vote on the resolution condemning the state law, said she expects Wayne will face the same challenges during the next affordable housing round.

"Wayne has an unwillingness to plan its own development for what it needs," she said. "I think that if the past is prologue, they're going to continue to do it this way."