Concerns over New Brunswick Devco’s Failure to pay CRDA’s Loan worth $20 Million

Concerns have been raised about New Brunswick Devco over unpaid CRDA loan of $20 million. In January, the Middlesex County Improvement Authority did not honor its payments for the loan in principal and interest. This article was written on Press for Atlantic as highlighted in the link below
The loan, which was sourced in 2005, financed the construction of The Heldrich, a hotel and conference center built by New Brunswick Development Corporation. State Senate President, Stephen Sweeney, has touted the corporation as a model of what public money can do to develop large-scale projects. The New Brunswick or Devco firm serves as a model for Atlantic City Development Corporation that expects to manage over $200 million in public-private financing. Attorney Christopher Paladino leads the two corporations. According to him, CRDA will receive payment but it may take a few more years to be actualized.

Heldrich, which was established in 2007 on, has struggled to get guests. According to Paladino, the hotel has financial difficulties. As a result, the corporation had to tap approximately $776,000 of its money to fund essential capital expenses like mattress and carpet replacement. Paladino added that the corporation is still engaged in the project in order to make it healthy.

The CRDA loan was part of a financing worth $107 million, which
was put together by the corporation in order to develop The Heldrich. In the meantime, the Atlantic County Improvement Authority is readying to issue $120 million in bonds for the Gateway Project in May. The bonds will be used to develop a Stockton University satellite campus. According to John Cantalupo, the bond counsel for the authority, the Gateway bonds will not face the same shortfalls as those experienced in Heldrich financing.

About Devco
New Brunswick Development Corporation or DEVCO on pressofatlanticcity is a nonprofit urban real estate development firm. It was established in mid 1970’s. It has designed a nationally recognized paragon for redevelopment based on strategic public policy. The company’s projects are in line with the needs of the people that live, work and visit New Brunswick. It leverages resources via public and private partnership to develop feasible projects.

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