According to the Press of Atlantic City article, the recent dealings about a deal involving Devco has started to face additional questions and scrutiny. Any time a real estate deal is brought to light there are many questions that can arise, but the one involving Devco starts to look like there are potential failures as well as consequences that no-one can quite put their finger on. Even though not all of the details have yet to be released, this is an issue that needs to be taken care of as quickly as possible. If not, the price tag to the tune of millions of dollars already is only going to further balloon and have additional negative consequences and reprecussions.
To make a long story short, the problem being faced is that the Middlesex County Improvement Authority failed to pay out $1 million on a loan of $20 million for a new hotel and conference center. The problem isn’t just that $1 million is currently in question, it is that there are already $7 million in arrears on a loan that was originally made in 2005. Any time that much money is up for grabs, it can be a very questionable deal indeed. When you consider the position that Devco is now in as a result of these missed payments, people are starting to worry on both sides of the coin.
The biggest questions for Devco is that when will the actual payments occur? In the meantime, the bankrollers of the project, the contractors, and the suppliers are all out money until the promised payments come through. When you put down your word and actually want the other party to come through and work with you, it can be hard to succeed when you back out of the deal and the original terms. Devco is now on the hook until this issue is resolved and then Devco can move forward.