Russo Development Funds 2-Phase NJ Luxury Project
Development is taking shape at the site of a former Sears department store.
Russo Development LLC has closed on $162 million in construction financing for The Raye by Vermella, an under-development 543-unit luxury apartment community located in New Brunswick, N.J. The three-year floating rate permanent construction loan was provided by Wells Fargo in a transaction handled by JLL. Transformco Properties is also listed as an owner of the property.
The Raye by Vermella is being built as two five-story buildings taking shape over two phases. Phase one is nearing completion and is expected to reach full stabilization by the end of this year. This phase will bring 272 residences with a mix of one- to three-bedroom layouts that are already 65 percent pre-leased. Phase two is expected to stabilize in late 2027, and will comprise 262 units.
The JLL team consisted of Senior Managing Director Thomas Didio, Managing Director Thomas E. Didio, Jr., Director Gerard Quinn and Associate Michael Mataras.
Reimaging a former Sears
Russo Development received a separate construction loan from Wells Fargo for the project totaling $72 million in 2023, according to Yardi Matrix data. Amenities for The Raye include a pool deck with grilling stations, a fitness center, package lockers, pet spa, children’s playroom, podcast rooms and more. The community is also benefitting from an accretive 30-year PILOT program.
Individual units will be fit with in-unit washers and dryers as well as stainless steel appliances and walk-in closets. Some residences will feature dens, alongside private balconies or patios.
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Located at 1000 Vermella Drive, The Raye by Vermella has access to major roadways like the New Jersey Turnpike and Route 1. The community will offer residents a private shuttle to the New Brunswick Train Station for NJ Transit access. Rutgers University is about two miles away and about 22 miles away from Newark Liberty International Airport.
The construction site spans 20 acres and was the former home to a Sears, which closed its doors in 2020. In addition to being a luxury residential community, plan call for a 40,000-square-foot retail space on the ground floor. There are talks of adding a grocery store to the second building.
In addition to the 543 units across the two buildings, the community is also adding 168 Pulte townhomes in its Scarlet Place section, which is nearly finished, My Central Jersey reported. Russo also included this development in an Urban Land Institute Program, UrbanPlan, which brings high school students the ability to work with real estate professionals in a simulated real estate planning experience.
Russo’s projects across New Jersey
Russo Development is an active developer in New Jersey, having opened multiple properties over the years within the Vermella brand. These include Vermella at Garwood Station, which opened in 2022. Late last year, Russo, along with partners The Hampshire Cos. and Riverbank Management LLC, delivered on The Ora, a 270-unit luxury property with 9,000 square feet of ground-floor retail space. Russo’s Property Management Firm operates the property, which opened last December.
Still to come for the company is a future 426-unit multifamily near Paramus, N.J. Russo and KRE Group purchased the Bergen Town Center Land site from Urban Edge Properties for $25 million. Construction is set to happen in two phases.
