NJ city has $350M plan to turn historic hospital into luxury housing. Locals are skeptical.

How does this sound? A brand new apartment with lower rents than Hoboken or Jersey City, yet still only a half-hour from Manhattan by train, all in a gated complex with restaurants, a rooftop pool and lounge, a park and an ice skating rink outside your front door.

That's New York City-based developer Terrence Murray's proposal to transform a historic hospital campus in Orange, New Jersey into luxury housing at a cost of $350 million. The Orange Memorial Hospital site has sat vacant for two decades, and preservationists have listed the buildings as endangered.

But some Orange residents are skeptical of the high-priced development in a city where Census data shows 1 in 5 people live in poverty, and where they say a higher share of Orange's predominantly Black population is being pushed out by gentrification and rising housing costs.

“The people in charge of the city really like the idea of putting market-rate apartments on every vacant lot they can find,” said Mindy Fullilove, a psychiatrist who was born in and currently works in Orange. “That  has pushed up prices all over the whole city.”

The hospital, which was built in 1906, once housed the United States' first four-year nursing school. It was also where local inventor and hospital patron Thomas Edison kept his lab. But it closed its doors in 2005, and many of the buildings have since fallen into disrepair.

“This is not just a real estate project,” he said. "It’s preserving the legacy of the hospital and bringing out more of the identity and history of Orange.”

If it continues moving forward, the project would create more than 1,000 market-rate apartments and help New Jersey meet its goal of ramping up transit-oriented development. Murray said he’s working to obtain tax credits from the state earmarked for housing near transit hubs under the New Jersey Economic Recovery Act passed in 2020. The plan would also relocate Orange Township City Hall from its current building to the hospital’s famous Mary Austen Hall, the site of the former nursing school, once it’s restored.

But a vocal group of Orange residents, some of whom recall being treated at the hospital, are opposed to the plan. Though they were promised that their voices would be heard around the redevelopment, they said, they were only brought into the conversation after the city approved the site plans. Existing residents also question whether the development’s amenities and features are meant to serve the community as a whole, or just the new people who move into the complex.

Byron Nicholas is a professional city planner who lives a block away from the site. He said he only became aware of the project in late 2024, a few weeks before the city’s planning board gave its stamp of approval. Afterward, two town hall meetings — one in February and another last week — were held to hear from the local community.

“ I think having a gated community really sends a message to residents adjacent or in the perimeter of the site that they're not welcomed,” Nicholas said.

He’s aligned with a coalition of about 20 local groups, including faith-based organizations, tenants associations and other residents, who are concerned there won’t be time to change anything about the developer’s plans.

Orange Mayor Dwayne Warren, who supports the plan, defended the timeline.

“ Legally, the planning board is the body that gives the go ahead for a development. So there's nothing to present prior to the planning board,” he said.

Plans for a park and skating rink have also raised concerns. Murray said the project would include about an acre-and-a-half of open space, including the rink, that would be open to the public during the day but closed at night for security reasons.

“What we're doing different than any other development in the city right now, is we're creating this really large open area that can be used by the public throughout the day,” he said.

But there is already a city park nearby, said Lavon Boykins, a single mom with two daughters who lives next to the hospital. She’s worried the new development could cause division within the community.

“My concern is: Are you trying to create separation between the children who are already here versus the new children who are going to come in?” she said.

The coalition of local residents has called for the plan to include affordable housing with access for people of all income levels.

Murray said he received site approval for two different concepts – one with about 20% of the housing set aside as affordable and another that is strictly market-rate – and his choice is contingent on how much he can obtain in state tax credits and other programs.

“The affordability will largely be driven by the incentive package that we can put together and the type of financing that we ultimately put together,” he said.

Murray still needs the City Council to approve his overall project plan. The developer said he’s hopeful he’ll be “moving some dirt” by the end of the year or early 2026, but that he’s still open to input from locals.

“ I'm continuing to have these conversations, hoping that I can get some of that input to understand where we might be able to make some changes,” Murray said.