The CRDA Unpaid $20 million loan is raising questions about New Brunswick Development Corporation
This past month, Middlesex Regional Development and Expansion Authority failed to pay back $1 million in interest and principle on the received $20 million loan from the Casino Reinvestment Development and Expansion Authority. For five years now, the Improvement Authority has already been in arrears, racking up more than $7 million in skipped payments.
The loan, made in 2005, took a long way in financing the construction of the Heldrich, the New Brunswick hotel and conference facility that was developed by the non-profit organization by the name New Brunswick Development Corporation, Devco.
The Senate president, Stephen Sweeny, has continually touted the corporation as an example of what is usually done when public funds are channeled through private companies for large scale construction execution. The outfit for New Brunswick is also the very model of the Atlantic Development Corporation that is a sister company expecting to oversee over 200 million in private and public funding – including the $19.5 million private and government funding- for the development of the Gateway project in the Chelsea section of the city.
Both companies are headed by the same attorney, Chris Paladino, who arranged for the transfer f the $20 million Heldrich loan. “CRDA will be eventually paid in full, but this will take longer than we expected,” he said this past week.
The Heldrich building, which was opened in 2007 at the beginning of the global economic crisis, is still struggling to attract customers. This past year, it had an occupancy rate of 63.5 percent, and its largest tenant was Johnson & Johnson, whose executives are sitting on the board of directors of the New Brunswick Development Incorporation. The hotel is struggling with raising enough money to run itself and pay for its debt. Full article can be found on the PressOfAtlanticCity.com.