Court Settlement Allows For 450 Homes At Calico Evil Clown Property On Rt. 35

MIDDLETOWN, NJ — A New Jersey Superior Court judge ordered Middletown Township and the developer of the Calico the Evil Clown property on Rt. 35 to reach a settlement with each other.

The settlement resolves this lawsuit, filed by the developer in 2023: Middletown Sued By Developer Over Circus Liquors/Rt. 35 Property

This is the property at 761 Rt. 35. Other than the empty liquor store (which was just used for a wedding last week), it's a 51-acre lot that consists of a large empty parking lot and woods.

The settlement allows for up to 450 town homes to be built on that land, 68 of which must be affordable.

A judge signed off on the settlement on Oct. 2. Middletown posted the 37-page settlement here on the Township website.

The longtime owners of that property are the Scaduto/Azzolina families, under their company Mountain Hill. The Scaduto/Azzolina families have a contract to sell all 51 acres to AAMHMT Property LLC, a developer based in Wall Twp.

AAMHMT originally wanted to build 937 units of housing there, which Middletown resisted. In 2023, AAMHMT sued Middletown Township, arguing that Middletown was shirking its affordable housing requirement from the state of New Jersey — essentially, the developer said Middletown is not allowing enough affordable housing to be built in town, and that Middletown should be forced to approve their development proposal, because it includes affordable housing.

Today's settlement is intended to resolve that long-running legal battle. The court ordered that 15 percent of those 450 town homes must be affordable housing; that would be at least 68 affordable units. In total, the development would consist of: 170 three-story market-rate town homes, 226 stacked town homes, (meaning one unit on top of another, mostly market rate but some affordable) and 54 affordable housing apartment-style units.

The development would take up most of the property, although portions of the site would remain wooded, including buffers along Rt. 35 and Kings Highway East. The developer is required to keep a lot of the trees at the site; in the summer, the housing will likely not be visible from Rt. 35 and Kings Highway East, said Middletown Township attorney Brian Nelson. There will be no access to the development from Rt. 35. Access will only be from Kings Highway East, Carton Way and Kanes Lane.

Construction on this is still years away. Despite the settlement, the development is not automatically approved for construction. AAMHMT must still submit engineering and site rendering plans to the Township. They also still have to get approval from the Middletown Planning Board and even possibly the New Jersey Department of Environmental Protection because there are wetlands there.

This land was supposed to be Village 35/The Shoppes at Middletown

Middletown Twp. was always OK with having housing in the back of the property, and shops and restaurants in the front, facing Rt. 35. In fact, there was a proposal in 2018 to make this Village 35/The Shoppes at Middletown. There would have been housing in the back of the lot with a Wegman's, a movie theater, a 24-Hour Fitness and shops facing Rt. 35.

But in 2020 (the middle of the pandemic) the developer suddenly pulled out and entirely killed The Shoppes at Middletown after they said they could not get loans to build it.