One can argue that one of the reasons Xavier is one of the more successful programs is because they have a state of the art arena paired with consistent success. It's also operated by the university and they can have concerts and events there. Yes you get that Madison Square Garden but St. John's has no control over that. Having a bigger arena operated solely by the University can improve the campus life and experience which is a consistent weakness I hear in our recruiting abilities.
And you're right, it's not a professional sports franchise. But schools still need to stay up to date. Carnesecca is an out of date, tiny, and not very fan-friendly arena. Sitting up top is horrendous. Investing in a place where you can maybe convince established musicians/comedians/entertainers to perform will only increase the experience of going to St. John's.