Real estate icon, who transformed Jersey City’s waterfront, reflects on his legacy

When Richard LeFrak and his father, Samuel, surveyed Jersey City, they thought the desolate train yards near the Holland Tunnel might be a good spot for a Kmart.

More than 40 years ago neither even dared to imagine that his company’s development of 600 acres of what is now Newport would help transform the city into “sixth borough of New York City” status and trigger the city’s economic revival.

The Kmart was built somewhere else. The LeFraks had a hunch the land could be more valuable than a blue-light special.

“Something of this size, with this amount of land, it was a leap of faith in a certain sense,” Richard said. “And when I look at it today and I see not only what we’ve done, which is pretty extraordinary, but the whole explosion of growth in Jersey City … Did I ever think it would be quite as dramatic?

“No. If I did, I would have bought every inch of land I could in Jersey City.”

The third-generation leader of the city’s largest developer, LeFrak, sat exclusively with The Jersey Journal in his Manhattan office as he prepares to take a step back from the company and let his sons, Jamie and Harrison, take the helm.

The 77-year-old master developer, whose net worth is estimated by Forbes at $3.4 billion, reflected on the journey in transitioning the once-downtrodden waterfront into an affluent neighborhood packed with luxury apartments and condos, retail stores and restaurants.

“I kind of went from being on the field to coach, that is kind of what I tell everybody now,” said LeFrak, who became CEO upon his father’s death in 2003. “… There is a time in the life of any organization when you have to let some of the responsibility go and give people the opportunity to actually experience the thrill of victory and the agony of defeat.

“I am going to be 78 years old, there is a time when you have to take a step back,” said LeFrak, who despite the onset of Parkinson’s Disease plans to remain active in the company. “The next generation has to have the experiences of making decisions and living with what they do.”

The Newport visionary made the announcement at the Jersey City Summit Monday, in front of the many developers who followed the LeFraks’ lead in the city. But Richard and Samuel were one of the first, to take on the task.

“If you go back in time to 1987 or ‘88 when we opened the first building … there was nothing there …there were two buildings in the middle of nowhere … I said (to my father) ‘Why do you want to put the building there for?’ ” LeFrak said.

“You figured he would start on the south side or the north side. And he said ‘Well because nobody knows this place is here and I have to make sure when people go through the Holland Tunnel, they are going to see something.’ He had the right idea because there was nothing there.”

The first buildings, built in 1987 and 1988, were named after the first four U.S. presidents –George Washington, John Adams, Thomas Jefferson and James Madison. Today, the buildings, located on River Drive and Newport Parkway, are known as the Waterside Square and Parkside complexes and together contain 1,500 apartments, of which 271 are affordable units.

The LeFrak Organization, whose roots date back to 1883 in France, has more than 400 developments from New York to Miami to the West Coast; and has diversified with significant investments in securities, private businesses and energy. Before Jersey City, the company made its mark with Lefrak City in Queens New York.

But Jersey City is special, LeFrak says, because was “no one was living there, so no one had to be moved.”

A 15-minute video shared at the summit Monday reflects on the historic transformation of the area into one of the most affluent areas not only in Jersey City, but all of New Jersey.

The video, edited for the summit, was originally made for LeFrak to share the history of the family with his grandchildren and their children, “just so they would have some sense what was accomplished prior to them being born …”

The video starts with the anecdote about the search for a good site for a new Kmart, but Mel Simon, the co-founder of Simon Property Group, was seeking a partner and wanted a residential developer.

The LeFraks and Simon would eventually team to create Newport Mall in 1987, the start of the community LeFrak envisioned for the area.

Schools, subways and places to shop were touchstones Samuel, who died in 2003, searched for in creating large development communities, Richard told The Jersey Journal.

“My dad always believed when he was developing, and this goes back to the 1950s, that he should accumulate lots of land because if he had enough land he can kind of reshape the neighborhood,” he said.

The LeFraks don’t take all the credit for reshaping the entire area, but Richard knows his large role as a catalyst for the change Newport initiated in the city. He also tips his hat to former Mayor Gerry McCann for having confidence in the plan.

He is unsure that if without him, this project “would get off the ground. At all.”

Even if people scoffed at the notion of the Newport neighborhood 40 years ago, there was no “I told you so” moment for Richard, whose family business isn’t done in Jersey City.

“When we would tell people we were developing in Jersey City, they would roll their eyes,” said LeFrak, comparing 40 years ago to the current demand for redevelopment in the city. “We are delighted people are running there to develop. Competition brings business, and investment improves the community.”

The company still more than 20 properties in the city that haven’t been touched, LeFrak says. But those plans will be guided by his sons and “probably one of his sons or daughters, or my other son’s child will say ‘mission accomplished.’ “

LeFrak hinted that perhaps building the community from scratch was the easy part. Tending it and not overdeveloping may be trickier.

“I want (Jamie and Harrison) to continue in Jersey City, particularly, to be sensitive to the fact that the critical mass we have out there is already a community,” Richard said. “We have to develop within the framework of that existing community. I don’t want to over-tax the resources we have there … the infrastructure … I want to add more public amenities and more recreation. I just want to make it a wonderful place.”

Being able to view the work he, his father and his sons have created over 40 years is a priceless “dividend.”

Looking up at a panoramic photo of the Newport neighborhood that takes up almost an entire office wall, Richard sees his legacy.

“That’s what I did. When I am gone, that is going to be there. That place which didn’t exist is going to be there in 20 years, 50 years, and 100 years, it is still going to be there … I started it but my sons, of course, will finish it and they are going to get to say that is what I did.”