Amusement park demolition underway at the Jersey Shore.

A large crane began razing an old, dilapidated amusement park here, paving the way for a new mixed-use project that will rise along Long Branch's redeveloping Atlantic Ocean shoreline.

As the crane worked its way through the rundown structures of Kids World, a crowd of Long Branch officials and long-time residents looked on with fond memories of the once-popular tourist attraction and enthusiasm for things to come.

"This is an important day for Long Branch as the demolition is the first physical sign of redevelopment," noted Mayor Adam Schneider. "We've been telling people for years about restoring vitality here. There's nothing like seeing dirt being moved."

The fate of the Kids World amusement park was sealed in 1987 when a fire destroyed the Long Branch Amusement Pier and most of the park. The pier was removed several years ago and the park never reopened, its meandering blue waterslide slipping into further decay -- a symbol of the lost spirit and disinvestment in much of the area.

Last year, Applied Development Company of Hoboken was selected to transform 16 acres of property at the former amusement park site and surrounding streets into Pier Village, a complex of 420 upscale residences and 100,000 square feet of shops and restaurants. The project is being completed with gap financing from various state agencies, including the New Jersey Redevelopment Authority, the Department of Community Affairs and the Housing and Mortgage Finance Agency.

Simultaneously, Applied expects to break ground for an additional 350 luxury residences and 5,000 square feet of retail space on 25 acres in the district's Beachfront North section.

"This is very exciting for Long Branch which provides the perfect environment for this type of housing effort," noted Joseph Barry, Applied's President. "We believe the continued strong local support and development of the oceanfront will spark citywide reinvestment of businesses."

The new activity along the water's edge is just part of the story surrounding plans to revive this oceanfront community. With the crane continuing to carve away at the old amusement park, officials moved inland for a ribbon cutting ceremony to celebrate the first phase of 38 new for-sale homes located on scattered sites that are available to moderate-income families.

All ten of the homes in the first phase have been sold, while an additional nine contracts have been taken on the remaining 28 homes -- all of which are located in a neighborhood designated for assistance by the Urban Coordinating Council and within Long Branch's Urban Enterprise Zone. The homes feature three bedrooms, 2 1/2 baths, a full basement and a one-car garage, and are priced from $96,000.

"These residences are significant not only because where they are, but where they are not," said Jane M. Kenny, Commissioner of the Department of Community Affairs (DCA). "They are proof that the renaissance of Long Branch will not be [limited to the waterfront. Like a mighty tide, the investment that's flowing into Long Ranch has quickly crossed Ocean Avenue and into the city's neighborhoods."

The new affordable housing is being developed by a joint venture of The Mon Group of Shrewesbury and Applied.

"New Jersey clearly needs to develop its cities," Applied's Barry pointed out. "Areas like Long Branch became invested, and disinvested. They must be reborn as communities for everyone, and that means housing."

The $4.2 million affordable housing program is being financed in part by the New Jersey Housing and Mortgage Finance Agency (HMFA), which provided $2.2 million in construction financing and subsidy funds through its Urban Home Ownership Recovery Program.

Applied Development Company currently owns and manages more than 5000 units throughout the state and is actively developing over $1 billion worth of real estate in New Jersey.