Middlesex County Improvement Authority took a loan in 2005 for the construction of The Heldrich, a hotel and conference centre. A total of $ 107 Million financing was put together to finance the construction. Mid County Improvement Authority issued municipal bonds of $ 70 Million while as Casino Reinvestment Development Authority issued $20, Million. The $ 20 M loan was arranged by attorney Christopher Paladino, who heads the New Brunswick Development Corporation the developer of The Heldrich. The Improvement Authority failed to pay $1Million in interest and principal and the $20 M loan. The Authority has been in arrears for five years accruing $7 Million in missed payments.
The 235 roomed hotel has been struggling to attract guests and so far senior bondholders have been repaid $30 Million while as subordinate bondholders have not been paid yet. Casino Reinvestment Development Authority acknowledged that the loan has not been paid, but they are aware that subordinate bonds will be repaid last. More about the loan can be found on Press of Atlantic City.
Atlantic City Development Corporation, a sister firm of New Brunswick Development Corporation, expects to oversee more than $ 200 Million in private and public financing, which includes the development of Getaway Project. The Middlesex County Improvement Authority will issue $120 Million bonds that will build Stockton University Satellite Campus. The bonds will be paid through the sale of tax credits and dorm-room revenue. However, there is a law barring state agencies from giving loans and grants to businesses and non-profits that have defaulted state-issued loans and bonds.
New Brunswick Development Corporation (Devco) is a private non-profit urban real estate development company. The Corporation was founded in the mid-1970s and it has overseen about 1.6 Billion investments and it serves as a catalyst for city’s revitalization. DEVCO has been recognised as a powerful engine for economic growth. It creates innovative project financing structures, strategic alliances and strong public – private partnerships.