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20 DECEMBER 2021
Completed in 2019, the New Brunswick Performing Arts Center on Livingston Avenue has brought new performance venues, rehearsal space and more than 200 apartments by Pennrose and office space to downtown New Brunswick.
residential market.
By the time it broke ground in fall 2017, with Devco at the helm, the project had attracted nearly 20 other stakeholders beyond the initial theater groups, from the city, county and state agencies to Rutgers’ Mason Gross School of the Arts. Paladino also noted that Pennrose, a private developer, would buy the air rights to build 207 apartments above the state-of-the-art performance venues, rehearsal space and county offices.
Funding the project also meant tapping multiple banks and government grant, tax credit
and bond programs as part of
its elaborate financial structure. That included the use of a $40 million tax credit under the state’s former Economic Redevelopment and Growth program, which was authorized a year earlier by special legislation.
“The diversity of Devco’s portfolio demonstrates its enormous talent,” Cahill said
during NBPAC’s
grand opening
ceremony in
September 2019.
“Each project
may be unique,
but each has
followed the
same Devco
path: uncanny preparation, an ability to cull together the financing necessary to accomplish projects others would find impossible to undertake and a driving focus to execute the plan no matter the challenges confronted — always on budget and on time.”
Paladino, who boasts that the performing arts center was delivered with no debt, jokes that “the building part of it is easy.” Rather, the heavy lifting comes in the form of determining the feasibility of the project and creating a business plan.
“Once you know what you want to do and what it costs — and this is usually how it works — then you go shopping,” he said. “Then you go and you try to find the resources.”
Devco does that as well as any developer in New Jersey. And its not-for-profit structure allows
it to be much more patient than
its for-profit counterparts. The organization’s cash flow is typically from development fees and earned
income — accounting for roughly 75 percent of its budget — rather than recurring revenues from completed projects, he said. He added that, in some cases, the company has stayed on to manage a building after it’s delivered, providing another source of income but one that is much smaller by comparison.
“All of our profit gets spent on the next projects,” Paladino said.
Look no further than what’s now known as the New Jersey Innovation and Technology Hub, a planned two-building, 555,000-square-foot research campus in New Brunswick. Devco broke ground on the $665 million project in mid-October, but has spent the better part of five years preparing for it — investing some $4.5 million during that time — from marketing the site to prospective users to razing the hulking, concrete parking deck and retail mall that once occupied the property.
Those efforts are paying off in a big way. The Hub is now proceeding as
a key piece of Gov. Phil Murphy’s innovation- and technology-focused economic agenda and will house the new Rutgers Robert Wood Johnson Medical School, a new Rutgers translational research facility and an innovation center where startups will mingle with the state’s top health care and academic researchers. Devco
is the master developer for a high- powered partnership that includes Rutgers, RWJBarnabas Health and Hackensack Meridian Health, along with Princeton University as the complex’s first tenant.
“If you continue to work on things and you keep your eyes wide open, people see opportunity,” said Paladino, who recalls discussing the site with Murphy when the latter still only a candidate for governor. He also noted that the project, which will help Rutgers fulfill one of its most imminent needs, will benefit from Murphy’s new package of economic incentive programs.
“That makes The Hub the homerun that it’s going to be,” he said.
The groundbreaking came less than three months after Devco’s largest endeavor to date — a 12-story, 520,000-square-foot cancer hospital operated by RWJBarnabas Health and the Rutgers Cancer Institute of New Jersey. Slated for completion in 2024, the Jack and Sheryl Morris Cancer
doesn’t want to take,” Paladino said. “So we kind of stand in that abyss between those two things.”
The New Brunswick Performing Arts Center, which opened in 2019, “is
a perfect example” of that process, he said. The $172 million project was nearly a decade in the making, stemming from a desire by Mayor
Jim Cahill and others to double down on an industry that draws 300,000 patrons to the city annually. For many, that meant updating the aging, scattered facilities for the three active theater organizations in New Brunswick, which could only boost the economic impact on restaurants, hotels, parking and the
Jim Cahill
Courtesy: Pennrose