In 2005, the Casino Reinvestment Development Authority loaned $20 million dollars to the Middlesex County Improvement Authority for construction of a a New Brunswick hotel and conference center called The Heldrich replacing a blighted hotel that sat on the site. This 365,000 square foot project has been heralded as a landmark development in what can be accomplished when the public and the private sector work together. It contains 248 hotel rooms, 48 condominiums, a 50,000 square foot conference center, retail, restaurants and the Workforce Development Center for Rutgers University.
The Middlesex County Improvement Authority already missed almost $7 million in payments during the last five years. In January,the Middlesex authority DEVCO says that it will miss another $1 million payment plus interest payments on its loan. These loans are already provided at a lower interest rate than the authority could get if they went to the local bank.
Many real estate developments did not do as well in 2007 and 2008 as investors had hoped. Officials with the Heldrich like Chris Paladino say it was no different for them. The hotel continues to receive only 63.5 percent occupancy rates with Johnson & Johnson being their largest customer. Interestingly, executives with Johnson & Johnson serve on the board for the Middlesex authority.
DEVCO has asked to borrow millions in bonds for the Gateway project that will include a university campus, along with some office space. In March, the Atlantic City Improvement Authority approved $145 million for the Stockton campus and $12 million in state tax credits for construction of South Jersey Gas’ new $50 million headquarters which has previously been located at the other end of the county. The facility will also include a $35 million 886-space parking garage with South Jersey Gas paying for about 200 of those spaces.
DEVCO has many exciting projects in the works including the redevelopment of College Avenue. There is no doubt that these projects will be successful over time.