JUST IN: FOLLOWING COURT RULING, LAKEWOOD TOWNSHIP REVOKES CONSTRUCTION APPROVAL OF TOVIA ROSENBERG'S HOTEL & BANQUET HALL

Following the New Jersey Appellate Division's recent ruling tossing the Lakewood Planning Board's second approval of Tovia Rosenberg's nearly 10 year long project to construct a 5-story Courtyard Marriott hotel on Pine Street and New Hampshire Avenue, Township officials have now formally revoked their construction approval of the project, FAA News has learned.

Back in 2014, RD Lakewood, LLC, which is owned by Tovia (Thomas) Rosenberg, filed an application with the Lakewood Township Planning Board for site plan approval to develop a 5-story, 22,500 square foot hotel, a 3,153 square foot bank and 153 parking spaces, on Pine Street and New Hampshire Avenue.

Before the public hearing, RD Lakewood published a public notice in the local newspaper and mailed it to all property owners within 200 feet of the site as required by MLUL. The public notice stated that RD Lakewood applied to the Board "to construct a hotel as well as a bank."

At the public hearing, architectural plans were shown that included a bar, restaurant, and banquet facilities. These proposed uses were not listed in the applicant's legal notice.

Despite this issue, the Planning Board unanimously approved RD Lakewood's application and adopted a resolution on June 23, 2015.

In July 2015, Lakewood Realty Associates (LRA), which owned the Hilton Garden Inn in Lakewood and the Ramada Inn in Toms River filed a lawsuit in Superior Court seeking reversal of the Board's approval. LRA argued, among other things, that RD Lakewood's public notice was deficient because the notice stated that the site was for a "hotel and a bank," and did not mention the proposed bar, restaurant, and banquet facilities.

The Superior Court upheld the Board's approval and dismissed the lawsuit, determining, among other things, that the notice stating a hotel was proposed was sufficient given that the architectural plans on file with the planning board clearly indicated the proposed hotel would also include a restaurant with a bar, banquet facilities and meeting rooms, which the judge noted "are common amenities in a hotel of this size associated with a national brand."

In 2019, the Appellate Division reversed the trial court's decision and tossed out the Planning Board's approval.

The Appellate Division held that RD Lakewood's public notice was materially deficient because it did not adequately describe "the material characteristics of the development's proposed uses."

In tossing the lower court's decision, the Appellate Division noted that despite RD's assertion that restaurants, a bar, banquet facilities and meeting rooms, "are common amenities in a hotel of this size associated with a national brand," the issue is that on the local level, Lakewood Township's ordinance includes a definition of a hotel and that definition only said that "motels typically do not include lobbies and hotels do typically include lobbies," without specifying that hotels typically include restaurants, a bar, banquet facilities and meeting rooms.

The simple way to move forward would have been for RD to submit a new application to the Planning Board with proper notice listing all of the proposed uses. However, this would have been problematic as then, objectors could have argued that each use requires its own parking - which RD saw no reason to provide.

Never ones to sit back after someone suffers a loss in court and does not want to submit a new application with sufficient parking, in November 2019 Lakewood's Township Committee came to the rescue with an ordinance amending their definition of a hotel to expressly say that hotels "may include, but not be limited to, a lobby, full-service restaurant, cocktail lounges, meeting rooms, banquet facilities, and convention facilities..."

By amending this ordinance, the Committee hoped to fix RD's double problem, as their new notice would not need to disclose all of these proposed uses, - as they were now expressly part of a hotel, - and parking did not need to be provided for each of these uses, as they would be considered accessory uses which the ordinance deemed permitted with no additional parking requirement.

Of note is that prior to voting on the ordinance, Committeeman Albert Ackerman asked for an explanation on the ordinance wording change. Township Attorneys Steven Secare and Harold Hensel vaguely responded that this change was simply "to clarify the use."

Committeeman Meir Lichtenstein, who manages properties for Tovia Rosenberg, did not recuse himself from voting on this ordinance.

Subsequently, in August 2020, RD Lakewood sent legal notice to the neighbors notifying them about an "amended application for a hotel." The notice did not include the additional proposed uses inside the hotel.

In September 2020 the Lakewood Planning Board approved the amended application for a 5-story hotel with 138 rooms, a pool and sauna, gym, 3 meeting rooms, a bistro and 6,700 sq feet dining area, and a total of 193 parking spaces on the 3.569 acre lot.

Importantly, the Board accepted Engineer Brian Flannery's testimony that the dining area would be limited to meetings and convention uses and that it would not be used for weddings.

On November 30, 2020, represented by Newark Attorney Mark E. Duckstein, Esq. of Sills Cummis and Gross P.C., Lakewood Realty Associates, LLC filed yet another Complaint in Lieu of Prerogative Writs seeking to overturn the Planning Board's approval.

The Complaint challenged the fact that the legal notice did not mention the proposed banquet hall, arguing that the notice was "misleading, defective and in violation of N.J.S.A. 40:55D-11 and as a result the Planning Board was without jurisdiction to hear or act upon the application."

"The notice... enumerates a number of the components of the proposed hotel... including meeting rooms, food preparation areas/kitchen, lounge, bar area, dining area, pool and exercise room, but fails to identify the proposed banquet facilities notwithstanding that a 6,700-square foot banquet facility is included within the Application for the proposed hotel. 

"The proposed banquet facility available for functions which is the use that has the potential to be the most intense of all of the proposed uses comprising the hotel facility from a traffic and parking perspective, perhaps even more intense than the hotel use itself should definitely have been included in the notice," the Complaint stated.

Judge Marlene Ford held a trial on the Complaint in December 2021, and released a written decision dismissing the entire Complaint.

Notably, Judge Ford conceded that the legal notice did not mention a banquet hall, however, being that the Planning Board accepted Engineer Brian Flannery's expert testimony that the dining area would be limited to meetings and convention uses and that it would not be used for weddings, "the Court finds no merit to these arguments."

Lakewood Realty Associates continued right on to the Appellate Division. After over a year and half of waiting for a hearing, the Appellate Division held oral arguments on Monday, September 18, 2023.

As previously reported here on FAA News, just weeks after hearing oral arguments on the case, Appellate Division Judges Sabatino, Mawla and Chase issued a written ruling reversing the Board's 2020 approval, finding that "the developer's public notice of its second land use application was materially defective because it failed to disclose that the hotel would contain a banquet facility with the capacity to accommodate up to 833 people."

The public notice need not be "exhaustive." Shakoor Supermarkets, Inc. v. Old Bridge Twp. Plan. Bd. However, it must be sufficient to enable members of the public to make "an informed determination" about whether to attend and participate in the applicant's land use hearing. Perlmart.

Our first opinion in this case held that the elements of a restaurant and a banquet facility were sufficiently important to be required within RD Lakewood's public notice. Our determination in that regard remains unchanged. RD Lakewood persuaded the Planning Board and the trial court that the banquet facility did not have to be mentioned in the notice because, in the interim between the 2014 hearing on the first application and the 2020 hearings on the second application, the Township's ordinance was revised in 2019 to redefine "hotel" to include "banquet facilities." The trial court reasoned this definitional change no longer required RD Lakewood to obtain a use variance to enable the planned hotel to include a banquet facility.

However, that change does not eliminate the applicant's statutory obligation -- in connection with the land use application as a whole -- to convey to the public the impactful activities that will be authorized on the site.

The testimony at the hearings elicited that the banquet facility, which would be located in the hotel's basement, could hold up to 833 guests. That number of allowable attendees would far exceed the number of diners a member of the public would reasonably expect to use a "restaurant" within a hotel with 138 guest rooms and 193 parking spaces. 

Counsel at oral argument on the appeal suggested that the 833-guest figure was inaccurately calculated, and that far fewer banquet guests would be expected to use the facility. That assertion overlooks the point that a banquet facility is designed to draw substantial numbers of guests who would be traveling to and from the facility for banquet events and who would not necessarily be staying in a room at the hotel.

We recognize the Planning Board's resolution disallows the hotel to be used as a "wedding hall." But that does not prevent other very large gatherings from being held at the banquet facility, such as fund-raising dinners, political events, galas, retirement dinners and anniversary parties, and so on. The banquet facility was a material aspect of the application that needed to be mentioned in the notice, regardless of the change in the ordinance's definition of a hotel.

It is also concerning that the notice enumerates seven other activities that are specifically permitted for a "hotel," but conspicuously omits mention of a banquet facility. At oral argument on appeal, counsel for RD Lakewood candidly acknowledged the omission was not inadvertent. RD Lakewood presents no justification for why the public specified the hotel would have meeting rooms, a food prep area/kitchen, lounge, bar area, dining area, pool, and exercise room, but did not mention a banquet facility. Surely a banquet facility would have a far greater potential impact on site parking and traffic than, say, an exercise room. The exclusion of the banquet facility made the notice materially defective. 

Hence, consistent with the requirements of the MLUL and case law, we must reverse the trial court and vacate the approvals once again because of that 

jurisdictional deficiency.

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Following the release of this decision, the Township Engineering Department has issued a Stop Work Order on the project.

The notice is shown below:

Since the 2020 approval, (which is now vacated), the Township Committee has adopted a new Ordinance requiring 1 parking space per 1 person of the capacity of the banquet hall in the Cedarbridge Corporate Campus. This means that if the hotel project does seek a new Site Plan approval from the Planning Board, they will need to provide adequate parking for the banquet hall, which their previous application did not include.

The Township Committee likely enacted that new Ordinance only after this hotel got its 2020 approval simply to ensure that there is no competition hotel and banquet hall built in this area.

However, now that the new Ordinance will also require this hotel to provide adequate parking, it will certainly be interesting to see how the Committee deals with this new headache!

Of additional interest is that the Appellate Division was not persuaded by Brian Flannery's testimony that the banquet hall will not be used for weddings. This opens the door to two big things: 1) Yeshiva Toras Chaim's pending appeal includes an argument that the Board simply relied on Brian's expert testimony and therefore whatever he says should be the final word of the law. Based on today's ruling we see that the Appellate Division can ignore such an argument. 2) Going forward, the Planning Board will have the ability to push back harder on applications that contain rooms - even when Brian says it will not be a wedding hall - if they can potentially be used for "other very large gatherings... such as fund-raising dinners, political events, galas, retirement dinners and anniversary parties, and so on."

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