ATLANTIC CITY — The Stockton Island Campus is dead. Long live the Stockton Atlantic City campus.
Days after finalizing its sale of the former Showboat casino to Philadelphia developer Bart Blatstein, Stockton officials are prepared to move forward with new plans to develop a residential campus across town. The new site on Albany Avenue is a public-private partnership with the Atlantic City Development Corp., or AC Devco, called the AC Gateway.
The new project is much different and much more expensive than the campus envisioned a year ago, though Stockton’s costs have shifted. It also moves a major redevelopment effort in the city from the South East Inlet to Chelsea.
Stockton bought Showboat for $18 million in November 2014. Early estimates called for spending an additional $37 million over five years to convert the casino into classrooms and other renovations. The Casino Reinvestment Development Authority was to contribute $17 million toward the renovation costs.
The new, smaller project, coordinated by AC Devco, is estimated to cost $35 million for the academic building, $86.5 million for student housing and $34.5 million for a parking garage. The total $156 million is about $100 million more than the Showboat project.
Former Stockton President Herman Saatkamp had touted the Showboat as a bargain and the best deal for Stockton. Hotel rooms could quickly be converted into student housing, and classes could begin within months. The privately run hotel would generate revenue.
An unresolved deed restriction on the site killed the deal. Now, Stockton officials are saying the Gateway project, which was discussed before, is the better deal.
Stockton trustee Leo Schoffer, who chairs the university’s Atlantic City task force, said after the CRDA meeting Tuesday that Showboat would have required a lot more money over time. Building a new campus through the Decvo is a better choice in the long term, he said.
“Showboat had a building we could get into fast,” he said. “But it is a 30-year-old building. This will be brand new.”
Stockton’s contribution toward the new project is the same price it paid for Showboat, $18 million. The CRDA also approved spending $17 million of its own money for the new site. The rest is coming from $70 million in tax-exempt debt approved by the New Jersey Economic Development Authority last week and $28 million in tax-credit supported debt. The Atlantic County Improvement Authority is expected to bond at least some of the remaining debt.
The project will be coordinated by AC Devco, with the academic building turned over to Stockton after it is completed, said Christopher Paladino, president of the New Brunswick Devco, who is also working with Atlantic City. The old Atlantic City High School site also has room for two additional buildings.
The housing will be owned by the Devco but managed by Stockton, with student costs commensurate with housing on the main campus, Paladino said. At some point, Stockton could take over ownership.
The parking garage would also be owned by AC Devco, which will lease space to Stockton, as well as provide parking to the public and South Jersey Gas, which is getting new office space over the garage as part of the AC Devco Gateway project.
At the CRDA meeting Tuesday, members touted the project for its benefits to the entire Chelsea neighborhood. Executive Director John Palmieri called it a “game-changer.”
Walter Broome, general manager of the nearby Enclave condominiums, said he is looking forward to the new campus.
“It will bring in a new vitality,” he said.
But one neighborhood’s gain is another’s loss, and the future of the South East Inlet is again uncertain.
Longtime resident William Cheatham told the CRDA he is disappointed that the Showboat deal fell through because it had included efforts to revitalize the entire South East Inlet and its vacant land.
The Showboat plan had included a proposed University Park that would have encouraged residential and commercial development around the campus.
“It’s a shame that land’s been vacant so long,” Cheatham said.
CRDA Chairman Robert Mulcahy said they have to take advantage of where opportunities are now, and they hope the college will spur additional development throughout the city.
Schoffer said Chelsea will be easier for other potential investors to develop.
“It’s not just open land,” he said. “There are buildings there ready to go.”
Copy desk chief / comics blogger