Hotel at center of Tenafly redevelopment plan sold; council says original redevelopment agreement stalled

Tenafly officials told the mayor and council on March 4, 2025, that the hotel property included in the borough's Dean Drive redevelopment plan was sold to a new owner after the plan was adopted, and that sale has stalled the negotiated redeveloper agreement.

The change in ownership means the single-ownership condition in the redevelopment agreement no longer holds, town staff said, and the council rescinded authority to execute the redevelopment agreement when it learned not all parcels remained under the same ownership. Staff said the group that had been negotiating still owns the southerly parcel but the northerly parcel containing the hotel was sold “relatively soon after the redevelopment plan was adopted, unbeknownst to us,” according to a staff member identified in the meeting as Jeff (staff member). Jeff said the redevelopment agreement contained covenants and representations that presumed single ownership of the involved lots and that those conditions would have been breached had the agreement been signed.

Why it matters: the redevelopment plan is an overlay zone that would have permitted two principal uses — assisted living (congregate care housing) and hotels — and included conditions linking the proposed assisted-living development to hotel refurbishment. Jeff told the council the redevelopment plan was intended to be implemented together (hotel first, assisted living second), and that separate ownership prevents that integrated approach from moving forward as originally negotiated.

Council members reviewed the three-step process staff had described: (1) a redevelopment study that finds an area meets the state statute definition of “area in need of redevelopment,” (2) adoption of a redevelopment plan (an overlay that changes permitted uses and zoning provisions), and (3) a redevelopment agreement with the redeveloper that would set covenants and obligations. Staff said the borough had completed the study and adopted a plan; the redevelopment agreement, however, was not executed and the council withdrew authority to sign it once the ownership split became known. The council also noted that, because the redevelopment plan is an overlay, a property owner may instead use the underlying B-2 (downtown business) zoning to pursue permitted uses such as hotels or commercial uses. The underlying B-2 zone also allows dwelling units above a building’s first floor, staff said.

The council clarified limits of municipal authority: stormwater or other upgrades would apply only to new construction or additions that require site‑plan approval; interior renovations requiring only a building permit generally do not trigger stormwater upgrade requirements, Jeff said. The borough also confirmed it has no agreement with the current hotel owner and that the previously proposed assisted‑living project is not moving forward “as originally envisioned” while ownership remains split.

The mayor and council asked staff to report back on whether the current hotel owner plans to pursue renovation permits and what applications, if any, they file. The meeting record shows staff told the council the new hotel owner has come to discuss upgrades and that the owner is free to apply for permitted renovations under the underlying zoning, but no formal applications had been filed at the time of the meeting.

Ending: Council members said they would expect staff to return with options and next steps if the new hotel owner submits applications or if consolidating ownership again becomes feasible.