Investment Advisor Pleads Guilty

Name Changes: Buschman

Matrix Builds For Mercedes Benz

Equity for Doctors: Works for M. Gordon

Corrections or additions?

These articles by Barbara Fox were prepared for the July 23, 2003

issue of U.S. 1 Newspaper. All rights reserved.

Life in the Fast Lane: Safe Corridors

If you get a speeding ticket or change lanes without

signaling while you drive past the Carnegie Center, it will cost you

more than if you are driving by the Sarnoff Corporation. That’s

because

10 miles of Route 1 — from where you cross the bridge in Trenton

to Carnegie Center Boulevard — have been declared a "Safe

Corridor," and some traffic fines will double here.

A just-signed law authorizes Jack Lettiere, transportation

commissioner,

to designate "Safe Corridors" based upon accident rates,

fatalities,

traffic volume, and other highway traffic safety criteria. Half of

the fines collected will go to a new Highway Safety Fund to be used

for education, enforcement, capital improvements, and similar projects

that could improve highway safety. The law is part of a state

initiative

to reduce the record of 700 traffic-caused deaths in New Jersey last

year.

Twelve other Safe Corridors have been created, including the stretch

of Route 1 beginning at milepost 20 (just north of Henderson Road

and south of Black Horse Lane) and continuing to milepost 30 in

Edison.

The governor’s office also reports that $3 million is earmarked for

short-term improvements for a different 10-mile stretch of Route 1,

the stretch between Franklin Corner and Ridge roads. The improvements

include upgrades to traffic signals, installation of new, larger

signs,

new pedestrian crosswalks, and enhanced pavement markings.

These improvements were recommended by a Safety Impact team, convened

two months ago, that a press release says is "a

first-in-the-nation

collaborative effort" between the NJDOT, NJTransit, the Federal

Highway Administration, state and local law enforcement, the Federal

Motor Carrier Administration, and the National Highway Traffic Safety

Administration.

More than 677,000 vehicles traveled the Franklin Corner/Ridge Road

section of Route 1 in 2002, and nearly 1,400 accidents occurred there

in the last two years, according to the DOT. Yet not all of this

stretch

was included in the Safe Corridor assignment.

Safe Corridor assignments, parceled out in 10-mile modules, are

sometimes

contiguous, but the DOT chose to omit the 10-mile stretch between

the Carnegie Center and the northern part of South Brunswick. Kristin

Appelget, president of West Windsor Council, and Charles Morgan, West

Windsor councilman, are pushing to have the rest of this stretch added

to the Safe Corridor legislation.

The reason for omitting the 10 mile stretch of Route 1 in West

Windsor,

Plainsboro, and South Brunswick? "The Safety Impact team went

out prior to the decision on the corridor, two months ago, before

the passage of the legislation," says Anna Farneski, DOT

spokesperson.

"We didn’t want to wait for the Safe Corridors to be decided."

She says the DOT decided that the smaller section, from Trenton to

Carnegie Center, was deemed to be the most dangerous section. "It

was based on scientific evidence. Our review was comprehensive, and

we spent much time doing it."

The DOT points to other steps it has taken to improve highway safety:

actively promoting the #77 Aggressive Driver hotline statewide;

expediting

the installation of 100 miles of safety barriers; allocating $20

million

for engineering and technological highway improvements; adding 500

miles of raised pavement reflectors over the next two years; recording

public safety announcements; and expanding driver education programs.

Top Of Page
Investment Advisor Pleads Guilty

Former investment advisor Alexis Arlett, 44, pleaded

guilty last week to wire fraud and tax evasion. Arlett had conducted

her business, Arlett & Associates Inc., from her Montgomery home.

She has been charged with embezzling $3.3 million from her clients’

accounts and evading more than $922,000 in federal income taxes.

Last week, in the court of U.S. District Judge Anne E. Thompson,

Arlett

admitted to overcharging her clients and doctoring their account

statements

to conceal the fraud. She reportedly spent $1.3 million of the

embezzled

funds on jewelry and the rest went for art and clothes.

Arlett is free on $25,000 bond, says her attorney, Jeremy Frey of

Pepper Hamilton’s Cherry Hill office. She could face up to five years

in prison and maximum penalties of $350,000. She and her husband,

Michael Kochmann, have one child.

Arlett’s sentencing is scheduled for October 21, and though she could

be ordered to pay back the stolen investor funds and the unpaid income

taxes, it has yet to be seen whether the money can be collected.

Arlett’s

assets were frozen two years ago by the SEC. Just $500,000 has been

recovered so far from her estate, according to Theodore Liscinski,

a bankruptcy trustee in charge of Arlett’s involuntary personal

bankruptcy

case.

How Arlett’s scheme worked: she inflated her fees and, when clients

questioned their statements, she claimed there were accounting errors

and provided altered monthly statements. Sometimes she covered her

errors by inflating the value of her clients’ holdings.

The clients of Arlett & Associates were supposed to pay annual

advisory

fees: 1.5 percent of assets under management up to $200,000; 1 percent

of assets under management between $200,000 and $1 million; and .75

percent of assets under management of more than $1 million. Arlett

admitted that the amount she embezzled from 1995 to 2000 was more

than half of the entire value of all her company’s investment accounts

at the height of their collective value.

Assistant U.S. Attorney Scott Christie of the U.S. Attorney’s

Commercial

Crimes Unit in Newark represented the federal government.

Top Of Page
Name Changes: Buschman

Now that Insignia/ESG is joining CB Richard Ellis,

Buschman

Partners will once more be an independent corporate real estate

services

firm. For three years the Buschman organization was Insignia/ESG’s

representative in the Greater Princeton/Mercer County area.

"I have the utmost respect and admiration for Insignia/ESG. Our

parting has ended on only the most positive terms," says Buschman,

who has had his business in Princeton since 1985. Working with Steve

Tolcash, Tom Romano, and former Yardley golf pro Jim Murray, he

intends

to remain a niche broker catering to the needs of a defined market:

"We had a good time, and they are good people, but there were

a lot of people to put together in this thing. It wasn’t right for

them and it wasn’t right for us."

CB Richard Ellis and Insignia/ESG are scheduled to release the details

on the merger and the new name of the merged company on Wednesday,

July 23.

Buschman Partners, 1009 Lenox Drive, Building 4,

Suite 116, Lawrenceville 08648. John H. Buschman, executive managing

director. 609-896-1600; fax, 609-896-1753.

Top Of Page
Matrix Builds For Mercedes Benz

Matrix Development is developing a 650,000 square foot

regional parts-distribution facility near Exit 7A for auto

manufacturer

DaimlerChrysler’s Mercedes Benz division. To be completed by next

year, it will be the first major building at Matrix Business Center

at 7A. KSS Architects of Witherspoon Street is doing the high-tech

futuristic design.

The Mercedes Benz facility will be the second auto parts distribution

center that Matrix has developed, and the third one that KSS designed.

Matrix and Volkswagen commissioned KSS to design Volkswagen’s first

warehouse at Exit 8A in 1997. The 223,000-foot building became known

for its walls of glass. It is on the market now, marketed by Trammell

Crow, because Volkswagen has tripled its space with a move to a

928,000-foot

Station Road facility, also designed by KSS and developed by Cabot

Industrial Properties.

Purpose-built warehouses with very high ceilings are what the Fortune

500 companies want right now. "The norm for warehouse distribution

centers in Central Jersey was recently 32 foot clear and today it

is 36 foot clear," says Jim Murray, vice president of development

at Matrix. "As companies retool their logistics they ask for an

increasing number of dock doors and trailer parking spaces."

Matrix has filled one of its tracts at Exit 7A (Northeast Business

Park) and Mercedes Benz represents the first project in Matrix

Business

Center. The tracts are contiguous. They both use Exit 7 from the New

Jersey Turnpike but each has its own exit from I-195. The Mercedes

Benz Park will use Interchange 8 off of I-195, while Northeast

Business

Park has Interchange 7 off of I-195.

Of the 10 buildings totaling 3 million square feet at Northeast

Business

Park, two are under construction. The buildings include 1 million

square feet fronting the turnpike for Seaman’s Furniture, an almost

finished 435,000 foot warehouse for W.W. Grainger, 552,000 feet for

Lifetime Hoan (kitchen cutlery ), 120,000 feet for Bohren’s Moving

& Storage, and 150,000 for the Jack Morton Group, a display company.

Under construction is 135,000 square feet for Sleepy’s Mattress.

Since its founding in 1979, Matrix Development has developed real

estate valued in excess of $1 billion. In March the firm began

constructing

a 230,000-foot warehouse at 5 Fitzgerald Avenue in CenterPoint at

8A Industrial Park. Designed by Venezia & Associates of New Brunswick,

it is easily divisible for multiple tenants but Murray says he hopes

to announce a deal for 150,000 square feet soon.

Some of the vacant older buildings at Exit 8A are filling up, says

Murray. "Ten years ago the standard was 26 and 28 foot clear and

those buildings are a large chunk of the 8A vacancy. But those

buildings

are being filled by companies moving down from further north where

the ceilings were even lower."

Matrix Development Group, CN 4000, Cranbury 08512.

Joseph S. Taylor, president and chief executive officer. 732-521-2900;

fax, 609-395-8289. Home page: www.matrixcompanies.com

Top Of Page
Equity for Doctors: Works for M. Gordon

It’s the renter’s dilemma: Whether to bleed money into

the landlord’s pocket or whether to build or buy an office. Renters

don’t need capital, can move when they want, and don’t have to take

care of the property — and it costs time and trouble to develop

a building. Buying a condo is one solution, and M. Gordon construction

company has another that it is pitching to doctors.

Linden-based M. Gordon Construction is offering equity to its major

tenant, Windsor Radiology, a partnership of Princeton Radiology

Associates

and Radiology Affiliates Imaging. It is scheduled to occupy 14,000

square feet (most of the first floor) of an $8 million 40,000 foot

two-story building at Route 571 at Old Trenton Road in East Windsor.

Two similar buildings have also been approved for the $25 million

project. Buckman Architectural Group in Kenilworth is the designer,

and Dave Saltzman, of Newmark Real Estate of New Jersey, is marketing

the project.

M. Gordon has built 10 medical buildings around the state, is in the

process of constructing 6 buildings, and has 18 medical projects under

development, says Norman Silbert, business development manager. The

Windsor Radiology building broke ground on July 10.

It’s unusual to develop medical buildings that offer equity, but it’s

a good idea, says realtor Saltzman, because medical practices rarely

move — they stay in one place for an average of 27 years. That’s

why this construction company employs this unusual model. It allows

doctors to get equity in their office without subjecting them to the

hassles of development, construction, and maintenance. Other practices

can choose to lease or buy space in this building. M. Gordon handles

all the construction, fitout, and even the maintenance after the

building

is completed.

Physicians like owning their own offices, says Saltzman. "It is

good diversity for their income, but they don’t have the time to go

through the process of building them. Condominiums give you greater

risk because you are responsible for your space if you don’t use it

any more. With M. Gordon managing the project, including future

maintenance,

it is vertically integrated. This building is not just a return on

investment. It is a hands-free — but touch and feel

investment."

"Our project started with the need of a future tenant, and they

have speculated a venture for additional space. Every building the

Gordons have ever built is fully leased before the building is

complete,"

says Saltzman.

Saltzman cites the demographics: this building is equidistant from

three hospitals (Princeton, Hamilton, and Freehold) and can draw from

five towns experiencing growth rates of up to 37 percent. He’s also

happy about working with East Windsor. "In my 20 years of

development

experience," says Saltzman, "East Windsor has been as good

as any town in assisting in the application process."


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