Prosperity & Plight in South Jersey

While some South Jersey industries are thriving against the broader backdrop of regional economic development projects, other businesses are still recovering from the pandemic’s effects.

By George N. Saliba, Managing Editor On Feb 9, 2023

South Jersey thrives via its diverse industries, and the past few years have again largely proven this true: Tourism rose 14.3% statewide in 2021 and was reportedly strong in 2022, with Atlantic City and the broader Jersey Shore coastline contributing to this spike. Meanwhile, activity in industrial real estate, in higher education, and at healthcare facilities are also playing roles in bolstering the state’s lower eight counties, alongside additional industries. However, the rising tide has not lifted all boats: Various South Jersey businesses are still emerging from the pandemic’s woes, and since they no longer have COVID-related government subsidies, they are facing inflation and now learning “how to borrow money the right way,” according to one banker interviewed by New Jersey Business Magazine.

Atlantic City Gaming, Entertainment and Conventions

Businesspersons and industry experts alike are positive about Atlantic City’s attractions, where 2022 casino gaming statistics outpaced both pre-pandemic and 2021 figures, even though there is now increased competition from out-of-state gambling locales.

According to Jane Bokunewicz, PhD, faculty director, Lloyd D. Levenson Institute of Gaming, Hospitality and Tourism at Stockton University, Atlantic City gaming was growing before the pandemic, and then afterward there has been pent-up demand in addition to “people seeking experiences … they wanted to get out and experience things rather than just purchase products.”

The Atlantic City hospitality industry is precisely catering to these experience-seekers with Ocean Casino Resort having undertaken an $85 million renovation this past summer; Tropicana Atlantic City adding eight new dining and entertainment options; Bally’s Atlantic City Hotel & Casino having engaged in a recent $100 million renovation; and Caesar’s Atlantic City Hotel & Casino – in conjunction with the entertainment company Spiegelworld – opening a $75 million live entertainment and dining residency this coming June. Showboat Atlantic City Hotel additionally opened the largest arcade on the East Coast – the Lucky Snake – two years ago, which remains newsworthy in part because of its self-evident comment on Atlantic City’s ascending value. Also of note: Developer Bart Blatstein’s 103,000-square-foot indoor ISLAND waterpark at Showboat is slated to open Memorial Day weekend.

Part-and-parcel with Atlantic City’s value is high demand for meeting and conventions, of which Visit Atlantic City’s President and CEO Larry Sieg says overall, “At the end of the day, we’re selling a destination first, because if you don’t want to come here as a leisure visitor, you certainly are not going to encourage your attendees to come here for a convention.”

Sieg notes that the Atlantic City Convention Center is booked solid for the next several years, and even has meetings and conventions scheduled a decade away.

Potential Redevelopment

Atlantic City can be more than gaming, entertainment and conventions. Stockton University’s Bokunewicz explains, “… for [Atlantic City] to go to the ‘next level,’ it’s important to get more people living in the city … to diversify its economy.”

The redevelopment of Atlantic City’s old Bader Field airport may foster that exact goal: A recent $3 billion proposal from developer Bart Blatstein could create 10,000 rental units there, along with 400,000 square feet of office and retail space, as well as outdoor recreational areas. Bokunewicz says, “Atlantic City is one of the few shore towns that has so much undeveloped property, so it is ripe for [that] type of development; it’s an if-you-build-it-they-will-come kind of thing.”

Major South Jersey Projects

Other South Jersey economic development projects outside Atlantic City have progressed beyond proposal and planning stages, with work underway at the New Jersey Wind Port in Salem County, a $400-million project that will ultimately foster the construction of widely publicized wind turbines off the South Jersey coast.

And preliminary engineering is finally occurring for the 18-mile extension of a passenger light rail line from Camden City to Rowan University in Glassboro, a concept that has been on-again/off-again for many decades. “That light rail will become operational, in my opinion – barring anything unforeseen – within a five-year period,” declares Marlene Z. Asselta, president of the Southern New Jersey Development Council.

Healthcare

Also growing in South Jersey are its hospital facilities, which aim to meet the region’s needs even amid post-pandemic staffing struggles: Virtua Our Lady of Lourdes Hospital in Camden and Virtua Memorial in Mount Holly are both undergoing multi-year renovations, with Dr. John Matsinger, Virtua Health’s executive vice president and chief operating officer, telling New Jersey Business Magazine that the Mount Holly project is about a year-and-a-half behind the Camden undertaking; the renovations were initially announced in 2021.

Matsinger says overall, “Some parts of the [hospital buildings] are definitely newer than others, but I think when we look at how healthcare and consumerism is changing, we need to [build] private rooms [for patients] because we believe that’s the standard of care … the [renovations] will enable us to do that.”

Matsinger sees a broader modernization of hospital infrastructure completed throughout the years at various Virtua Health locations. For example, Virtua Voorhees Hospital has the only proton radiation therapy unit in South Jersey, and one of about 50 nationwide. Matsinger explains: “There’s no reason to leave South Jersey for [medical] care.”

Higher Education

There is also no reason to leave South Jersey to obtain a college or university degree. Rowan University has not only exponentially grown its enrollment numbers and status over the past decade, but it has redeveloped Glassboro Township via public-private partnerships under the stewardship of President Ali A. Houshmand. He tells New Jersey Business Magazine, “Enrollment growth and economic growth go hand in hand. In fact, one triggers the other. … We have tried to create a downtown that is safe and wonderful, with a campus that is gorgeous.”

He adds, “And when we use other people’s money in doing so, we have also managed our university like a business … our financial situation has always been solid.”

An affiliation agreement between Rowan University and Virtua Health in early 2022 has now, in part, facilitated the design stage of a five-story, 50,000-square-foot research center on Rowan’s west campus. Adjacent to that structure will be The School of Veterinary Medicine of Rowan University – the first of its kind in New Jersey – which will offer Doctor of Veterinary Medicine (DVM) degrees and related degrees. Houshmand says Rowan will also construct a small-animal hospital, and possibly another hospital for large animals. Rowan separately plans to either construct a new building – or refurbish an old one – for its School of Nursing & Health Professions.

Other projects are afoot: Rowan University is in the midst of constructing the $73 million Jean & Ric Edelman Fossil Park Museum, which the university says will be a “world-class destination” inspired by the long-term perspective that fossil records offer. Situated on a 65-acre plot in Mantua Township, it is expected to annually attract some 200,000 visitors upon its anticipated opening in May 2023.

Rowan University also has a request-for-proposal for a new 5,000 – to 7,000-seat arena on its west campus for its basketball program, and Houshmand expects it to “be a public place” for concerts, events and local schools.

South Jersey’s other large higher education institution – Galloway Township-based Stockton University – is constructing a second residence hall at its Atlantic City location, with a targeted completion date of May 2023; it will feature 416 beds within a 135,000-square-foot building.

The university also has a Multicultural Center opening in February 2023 on its Galloway Campus, aimed at addressing Stockton University’s increasingly diverse student population; Stockton’s Fall 2022 class was the most diverse in its history.

Banking

With all the fanfare of Atlantic City’s expanding prowess and other regional economic development projects, it’s easy to forget that many South Jersey businesses are struggling with the absence of Paycheck Protection Program (PPP) monies as well as other government stimulus funds, as they also cope with labor shortages and overall high costs.

“In certain industries, companies are borrowing money to grow and expand, but most companies are … looking at borrowing opportunities just to get them back to their pre-pandemic operating levels,” explains Vincent D’Alessandro, president, community bank, at OceanFirst Bank.

D’Alessandro adds, “We’re spending a lot of time with our companies re-educating them on how to borrow money the right way. They have gotten out of the habit because they’ve relied on government support for a while, and now [everything] comes at them a bit on steroids because costs are so dramatically higher [due to inflation].”

Conclusion

With South Jersey comprised of 3,700 square miles over eight counties, Oliver D. Cooke, Ph.D., associate professor of economics, William J. Hughes Center, Policy Scholar, School of Social and Behavioral Sciences at Stockton University, tells New Jersey Business Magazine overall: “As you move away from the shore and increase the definition of South Jersey, you get an economy that more closely resembles the overall structure of the US economy. It is much more likely to behave quite similarly to what you’re going to see at national levels.” On that point, Cooke cites strong national job growth, but also notes concerns about inflation and Federal Reserve interest rates hikes, as well as worries regarding the real estate market. All these factors may impact South Jersey’s economy.

He concludes, “I am somewhat optimistic that the Fed will be able to orchestrate about as soft a landing as you could have … given the difficult circumstances in which they find themselves. We’ll see if they can pull it off.”

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