The private nonprofit company DEVCO is based out of New Jersey and has made one of the largest investments, over $1.6 billion, into the economic growth of the city of New Brunswick. Founded in the mid 1970’s, the New Brunswick Development Corporation has had its hand in several projects including several government, residential and educational buildings. Most recently they are working on the College Avenue Redevelopment Initiative. Since it was created to company has won over twenty awards for their designs. Devco believes that the reason for its success due to its partnerships with both private and public domains, spreading out its projects across different sectors and making alliances with many businesses.
Earlier this year, the Press Atlantic City reported that the New Brunswick Development Corporation is under scrutiny after working with the Middlesex County Improvement Authority, who has been neglecting to pay the $1 million principal on a $20 million loan. The loan was given over a decade ago in 2005 to renovate the Heldrich Hotel. Devco’s attorney Christopher Paladino went on the record saying that the loan,”will be paid, but it’s just going to take a couple more years.” Increased income from the refurbished hotel was supposed to help with payments but the Heldrich has been less popular than many had hoped.
The New Brunswick Development Corporation has been working to solve the problem as they wait for more funds. Many of the bonds used to pay for the Heldrich have been repaid with interest, but subordinate bondholders haven’t seen any payments. To try and increase income Devco is teaming up with the Atlantic County Improvement Authority to work on a new project, the Stockton University satellite campus. Their hope is to make revenue from sale of tax credits and other college expenses. Devco reviewed financing for the project and is positive that it will not face the same crisis.