While the state grapples with the fate of the Meadowlands region's money-losing horse racing industry, billionaire real estate tycoon Stephen Ross is considering taking a gamble on the stalled Xanadu project. The New Jersey Sports and Exposition Authority (NJSEA) confirmed at its Feb. 3 meeting that Ross is negotiating with Xanadu developer Colony Capital, as well as New Jersey officials, to partner in the troubled project.
Although dramatic changes to the troubled $2 billion entertainment and retail center are doubtful, NJSEA Chairman Carl J. Goldberg said that the color scheme and name might change. Goldberg confirmed that the NJSEA met with the Miami Dolphins owner Friday. "It's not a deal that is consummated, but negotiations appear to us that the Related Companies (Ross's company) is inclined to complete the project, which is consistent to what Colony would do at the outset," he said. "They will announce a date for finishing construction and are likely to rename, re-launch and remarket it. We're cautiously optimistic."
Xanadu began with a developer's agreement in 2003. A 75-year lease of the site was approved in 2004 for Mills Corp. In 2006, Colony Capital took over the project for Mills Corps. The interior retail space has been constructed. Entertainment areas include an indoor ski slope and a giant Pepsi Ferris wheel, which has been scaled back. The project is estimated to be $500 million from completion.
Goldberg added that the NJSEA has been keeping Governor Chris Christie's office updated regarding Xanadu on a daily basis. Christie has called Xanadu a "failed business model." Added $20 million annual revenue losses from the racetrack have exacerbated the area's economic woes.
But Meadowlands Chamber of Commerce CEO Jim Kirkos sees a brighter future. He sent a letter to Christie's office outlining the importance of Xanadu, the IZOD Center and the new Giants Stadium. "There's no greater economic engine in the area," Kirkos reiterated in a phone interview after the meeting. Kirkos expressed enthusiasm that Gov. Christie's newly-formed, seven-member New Jersey Gaming, Sports and Entertainment Advisory Commission, headed by former NJSEA chairman Jon Hanson, would see Xanadu's importance as a component of the Meadowlands sports complex. "When you think about the sports complex 25 years ago, we're at this rebirth in time," Kirkos said. "We supported the Sports Authority when it reinvented itself. We supported the idea of redeveloping the sports complex (arena), which eventually turned out to be Xanadu. We're still bullish as to what an open Xanadu will do for the region." Regardless, he said research shows the project would provide jobs, support services and new money coming into the region. "That's why we remain consistent (in supporting the project)," he said. Although Xanadu has seen plenty of public backlash and is in a "stagnant stage," Kirkos said the key is to get an opening date. "The anti-Xanadu stuff is really anti-EnCap," he said, referring to the failed landfills-to-golf-course-and-housing scandal. "We should do all we can to maximize what the sports complex can represent so we ensure the taxpayer is not subsidizing anything."
Redd's Restaurant owner Doug Palsi said business has been better in the past than it is now. He looks forward to Xanadu's construction to resume and the new stadium to be built. "We're hanging in there," he said. "This is the slowest time of the year…January and February. Nobody has the extra money to go out. What helps us is construction…once they start building again. We're looking forward to it, not only for more traffic, which brings in more business, but more employees coming in for a drink after work. We're viewed as a Meadowlands destination. If you're going to a football game, you'll say, 'let's stop in at Redd's first.'"