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The Deal Maker

As president of the New Brunswick Development Corporation, the nonprofit organization largely associated with the physical renaissance of the Hub City, alumnus Christopher J. Paladino brings an effective repertoire of leadership, vision, bureaucratic finesse, and passion in facilitating the redevelopment of one of Rutgers’ host cities. By Steven Hart UCNB’92

When Christopher J. Paladino takes a walk through downtown New Brunswick, he sees the past, the present, and, he hopes, the future. As president of the New Brunswick Development Corporation, the nonprofit better known as Devco, Paladino RC’82, CLAW’85 is in charge of guiding the redevelopment of a city that once seemed destined to be another flat-lining urban center, a casualty of deindustrialization and white flight, its employers and businesses consumed by metastasizing suburbia. Since he took the job in 1994, Paladino has initiated and overseen $1.2 billion in projects, the most recent being a pair of complementary developments bracketing the New Brunswick train station that blend residential, retail, and institutional space. This year will see the launch of Devco’s most ambitious effort yet, a three-phase project that will transform the university’s College Avenue Campus.

Chris Paladino
Chris Paladino stands before the signature clock that greets visitors entering the Barnes & Noble at Rutgers college bookstore, which is part of The Gateway, a high-density, mixed-use redevelopment project on the corner of Somerset Street and Easton Avenue in New Brunswick. Photography by Nick Romanenko

Devco’s works are everywhere: a new Middlesex County administration building; a cluster of new or rehabilitated court and public safety centers; Rockoff Hall, a student apartment tower at George and New streets, which brought fresh life to an area once notable chiefly for drug dealing in the nearby cemetery; The Heldrich, a conference center right across Livingston Avenue from the Edward J. Bloustein School of Planning and Public Policy; the refurbished State Theatre, George Street Playhouse, and Crossroads Theatre; The Gateway, which houses residential units, university offices, and the Barnes & Noble at Rutgers college bookstore; and Wellness Plaza, which offers a menu of fitness and health services, as well as the Fresh Grocer, a top-quality supermarket in the center of New Brunswick’s downtown.

This blend of high-density residential and retail development is meant to attract young professionals and people sick of suburban sprawl, Paladino explains. “People don’t want to live out in the middle of nowhere,” he says. “A lot of them like the idea of living in an urban center, of being able to get around without having to live in their cars.” If enough of those people can be drawn to New Brunswick, he says, they will be followed by more and better retail, along with more and bigger employers. In short, the city will achieve what Paladino calls “critical mass.”

As a graduate of Rutgers, Paladino is in a better position than most to appreciate the scale of New Brunswick’s transformation. He came to Rutgers College in the late 1970s, when the city was flat on its back, seedy and prone to crime, its potholed streets lined with abandoned and decaying buildings. “Old New Brunswick was a pretty wild place for a college kid,” he says. “It was an interesting time in a lot of ways.” After graduating in 1982, he earned his law degree from the Rutgers School of Law–Camden in 1985. Paladino then served as a law clerk for state judge Eugene Serpentelli, the assignment judge of the Superior Court of New Jersey who was immersed in the controversy over restrictive zoning and the obligation of municipalities to allow for affordable housing. After practicing law with Connell Foley & Geiser for a few years, Paladino became an assistant counsel to James Florio, one of his Camden law professors, during Florio’s stormy single term as New Jersey governor. He had a ringside seat when Florio attempted to address a budget shortfall by increasing the state sales tax, prompting a statewide antitax tantrum that cost Florio politically.

“My takeaway from the Florio administration was that it isn’t enough to have good public policy,” Paladino says. “You have to sell it to the public.” Judging from the changes he has brought to the New Brunswick skyline, he took the lesson to heart.

The Devco office on Albany Street is more functional than opulent: a warren of small rooms crammed with blueprints, files, and conceptual drawings. In one corner of Paladino’s office stands a chest-high Everlast punching post, a gift from the Devco staff. “They thought it was better that I have something like that to take out my aggressions on,” he says. On the other side of the office, mounted on the wall by the door, is a collection of what are presumably frequently heard phrases such as “He’s dead to me” and “Just get it done.” Is Christopher Paladino a tough boss? “I’m passionate,” he says.

Chris Paladino
Chris Paladino, sitting in his office at Devco in downtown New Brunswick, expounds on his vision for the city and partnerships between his company, public and private developers, and Rutgers. In the foreground is a model of the three-phase project that will substantially redevelop the College Avenue Campus and be completed in 2016, in time for the university’s 250th anniversary. Photography by Nick Romanenko

He speaks quickly, usually in fully formed sentences, and during long conversations, his rapid-fire blinking and abrupt manner convey an impression of a tightly wound Type A personality in search of details to pounce on. His office is crammed with sports memorabilia; he cradles a football as he explains the Devco vision for New Brunswick. His seat on the New Jersey Gaming, Sports, and Entertainment Advisory Commission re­flects that lifelong passion. “I still have a scar on my head from grabbing a piece of the goal post at the last Rutgers-Princeton game,” he jokes.

Glenn Patterson, the city’s director of planning, community, and economic development, has his own take on what it’s like to work with Paladino. “It’s fun and intellectually stimulating,” says Patterson GSNB’86. “Chris has a buoyant personality, and he always lets you know what he’s thinking. He holds his staff to a very high standard and that makes it exciting to work with him.”

Before he was recruited for Devco, Paladino worked from 1991 to 1994 as deputy director for the New Jersey Economic Development Authority. There, he developed what all agree is his greatest strength at Devco: his ability to weave intricate financing deals with corporate and institutional partners, drawing on public and private sources. “These redevelopment projects are not simple,” Patterson says. “There are a lot of moving pieces, and nobody puts them together the way Chris does.”

For example, The Gateway and Well­ness Plaza projects, major developments adjacent to the New Brunswick train station totaling $250 million, required negotiations with 26 lending institutions. There was a $24.6 million issue of Recovery Zone Facility Bonds, a $41.5 million issue of Build America Bonds, and a $26.2 million offering of Recovery Zone Economic Development Bonds (all made possible by the American Recovery and Reinvestment Act of 2009); negotiations with banks to purchase federal tax credits through the New Markets Tax Credit Program (launched in 2000 to spur revitalization in low-income areas); and separate negotiations with 13 banks to put together a short-term construction financing package. This all took place at a time when the economy was still in a tailspin, lenders were averse to risk, and crucial funding sources were set to expire at year’s end.

Meanwhile, there were overlapping ownership interests to work out for each structure, with the university owning the bookstore portion of The Gateway building and leasing other areas under separate terms, and an ever-shifting calendar of planning sessions, meetings, public hearings, and engineering reviews to manage. Rockoff Hall, in the meantime, was financed primarily through a $54 million issue of revenue bonds, enhanced by a favorable rating from Moody’s, the credit rating agency. In January 2013, the building was sold to McKinney Properties, a Pittsburgh-based company that specializes in student housing. The $57 million purchase price was plowed into design work and preparations for the College Avenue redevelopment. “The type of deals we do—it’s more like conducting a symphony orchestra in which all the financial parties are temperamental musicians,” says Paladino. “It’s not just a matter of getting people to participate. It’s getting them to participate in queue.”

The Heldrich, top, the site of the former Roger Smith Hotel below
The Heldrich, top, features a 250-room hotel and conference center, retail space, academic space, and luxury condominiums. The cornerstone of the facility is the John J. Heldrich Center for Workforce Development. The facility’s location, at the confluence of George Street and Livingston Avenue, occupies the site of the former Roger Smith Hotel, at one time the center of New Brunswick’s social life. Before its demolition, it was a welfare hotel. Photography courtesy of Devco.

Now that the symphony has been composed, the music sounds sweet, indeed. New Brunswick’s strategic location along the Northeast Corridor rail line is an asset, but its decrepit train station (built in 1903 by the Pennsylvania Railroad) is a liability. The Gateway tower, featuring a ground-floor clock visible from College Avenue, its face spelling out “Rutgers,” was built with a pedestrian causeway affording access to the southbound train platform from Somerset Street. Commuters who don’t want to wait on the platform can take it easy in the ground-floor coffee shop, where flat-screen monitors list train arrivals and departures. (A similar causeway is planned for Wellness Plaza.)

Rivaling the ambition of The Gateway project will be the $300 million College Avenue project, which will create a new 30,000-square-foot facility for the New Brunswick Theological Seminary; a major academic building for the School of Arts and Sciences that will house a lecture hall and classrooms as well as offices for the humanities faculty; a residential honors college at George Street and Seminary Place; and a green space to enhance the appeal of Voorhees Mall. Once those facilities are completed at the beginning of the 2016 academic year, coinciding with the university’s 250th anniversary, Devco will build a 500-bed undergraduate residence hall at Lot 8 on College Avenue—long home to the Rutgers grease trucks. According to Paladino, the spirit of the trucks, which are more like stationary trailers, will live on at the newly developed site as concessions of some kind; final design decisions have yet to be made. Future generations of students will know the joy of a Fat Darrell, day or night.

It’s a Friday morning in February at Devco’s headquarters, and Paladino is hosting a delegation from Bethlehem, Pennsylvania, which hopes to emulate the Hub City in its own redevelopment program. The decades-long New Brunswick redevelopment program has become a frequently cited model for other troubled communities. Casinos are part of the Bethlehem plan, although New Jersey governor Chris Christie has compared Atlantic City’s tepid recovery unfavorably with the successful New Brunswick endeavor. Paladino, makes it clear he sees Atlantic City as a gigantic missed opportunity. “All the money didn’t stay in the city,” he says. “It became a political ploy; the money was used all over the state.” Although casinos were touted as Atlantic City’s path back to prosperity when the state’s voters approved the legalization of gambling in 1976, the casinos are now a barrier to any new approach, he says. “They let the casinos do whatever they wanted, and now there’s a wall of parking decks between the boardwalk and the rest of the city. They didn’t engage the community.” “Engaging the community” is one of Chris Paladino’s most frequently used phrases. He offers the University of Pennsylvania campus in Philadelphia as his ideal for Rutgers. During the initial burst of development during Devco’s first decades, the idea was to bring university students into the community. Now, Paladino says, he wants to bring the community to Rutgers.

It is important, Paladino says, to recognize the city’s unique strengths and build on them. New Brunswick has several advantages: its relatively small size, which maximizes the impact of any change; the continued and growing presence of the university; a pair of major medical centers; and the support of a firmly entrenched Democratic political organization. Above all, however, there is the presence of pharmaceutical titan Johnson & Johnson. Without the company’s support, he says, New Brunswick might well still be on the ropes.

Chris Paladino
The financing and construction of Wellness Plaza, one of two projects adjacent to the train station, were also orchestrated by Chris Paladino (pictured above). “These redevelopment projects are not simple,” says alumnus Glenn Patterson, the director of Planning, Community and Economic Development for New Brunswick. “There are a lot of moving pieces, and nobody puts them together the way Chris does.” Photography by Nick Romanenko

A happy accident brought Johnson & Johnson to New Brunswick in the 19th century, but a great deal of planning and strategy went into keeping it in the city during the 20th. In 1886, entrepreneur James Wood Johnson took a trip on the Pennsylvania Railroad line from New York to Philadelphia. Johnson and his brother, Edward Mead Johnson, were looking for a place to launch a new company specializing in medicated plasters and surgical gauze. When his train stopped at the New Brunswick depot, Johnson spotted a four-story brick building on a plot of land bounded by George, Hamilton, and Nielson streets. The former wallpaper plant offered easy access to raw materials via the railroad spur and the nearby Raritan River as well as the Delaware and Raritan Canal.

Johnson & Johnson and New Brunswick grew in tandem, but the city’s decline set in during the 1960s. New Brunswick escaped race riots that hastened the decline of other cities, but white flight and the loss of local businesses gnawed away at the formerly prosperous community. New Brunswick hit rock bottom in 1979, with unemployment at 12.7 percent while property values had dropped by 77 percent since 1950. The Albany Street site now occupied by the Johnson & Johnson headquarters was a maze of abandoned buildings and shuttered businesses, with few signs of life.

Johnson & Johnson could have joined the corporate exodus to the suburbs, but the advocacy of executives Richard B. Sellars and John J. Heldrich kept the firm rooted in its birthplace. In return, the company demanded partners in bringing the city back around. Devco was formed in the mid 1970s to guide the physical redevelopment of the city while another nonprofit entity, New Brunswick Tomorrow, addressed social programs. All of the city’s institutional players came on board, along with Democratic power player John A. Lynch Jr., who was mayor of New Brunswick from 1979 to 1991 and continued to pull strings as a state senator until he pleaded guilty to fraud and tax-evasion charges unrelated to Devco’s work.

Johnson & Johnson’s clout guaranteed the first major redevelopment project: the Hyatt Regency hotel, just across Albany Street from the corporation’s sprawling international headquarters. More changes followed, along with criticism from community activists and historic preservationists who thought Devco was a little too quick with the wrecking ball. “For the first 15 years, we were essentially a subsidiary of Johnson & Johnson,” Paladino says. “Devco’s board leadership was dominated by their executives. They did good work because they were familiar with the city: they lived in the community.” By the late 1980s, however, the redevelopment crusade had stalled. When Paladino arrived at Devco in 1994, “Johnson & Johnson,” he says, “had evolved into a multinational corporation, and leadership was far more focused on Beijing than George Street.”

“When I came on, Devco hadn’t had a president in something like 14 months and nothing new had been built for several years,” Paladino says. “We had to reinvent ourselves, and we did that by capitalizing on our assets.”
Paladino, for his part, notes that Devco has financed the construction of two schools, an example of a public-private project that “requires all kinds of public hearings,” he says. “They are actually a lot more transparent than most development projects.”

Florio, who keeps in touch with his former student, thinks the critics are off base. “New Brunswick is the supreme example in New Jersey of what urban revitalization should be,” the former governor says. “It’s an example of the benefits of getting everyone engaged.”

Although the Fresh Grocer opened in November 2012, work remained to be done on the upper floors of Wellness Plaza, where Robert Wood Johnson University Hospital is providing clinics and workshops on nutrition, exercise classes, and child care—all with steep membership discounts for New Brunswick residents. In Late February, city and county officials gathered on the second floor of Wellness Plaza to mark the grand opening and gave Chris Paladino a round of thanks. On the ground floor, traffic in and out of the Fresh Grocer, on the corner of Kirkpatrick and Paterson streets, was brisk and steady. College-age shoppers crossed paths with retirees, young mothers with strollers walked past academics, a young man was having a conversation with a woman selling flowers in the foyer. The voice of New Brunswick’s mayor, James Cahill, boomed overhead. “Chris Paladino is, simply put, the one who made Wellness Plaza happen.” Applause filled the air as people bustled outside the store, living their lives in the new city still taking shape around them. •