EAST RUTHERFORD — The lights went out at Xanadu months ago.
Today, they pulled the plug.
With the Christie administration pushing hard for a resolution of the long-stalled, half-finished entertainment and retail complex in the Meadowlands, a consortium of five lenders took control of the high-profile project from a group led by California-based Colony Capital LLC, with the aim of finally completing it.
"This action creates a strong foundation to effect the seamless transfer of ownership in order to complete this project as quickly as possible so that it is open and flourishing as an established visitor destination in advance of the 2014 Super Bowl," said Michael Beckerman, a spokesman for the lenders.
The nearby New Meadowlands Stadium will be the site of the 2014 Super Bowl.
Carl Goldberg, chairman of the New Jersey Sports and Exposition Authority, which had been overseeing the privately built Xanadu project, said today’s move by the primary lenders was a step forward.
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"The New Jersey Sports & Exposition Authority and the Governor’s Advisory Commission will continue to work with the banks as there are a number of interested parties in the property," Goldberg said in a statement. "All interests involved wish to see the most qualified party selected to complete and open the project."
Colony officials declined comment.
Kevin Roberts, a spokesman for Gov. Chris Christie said the governor wants a resolution to Xanadu. "We’re not so much concerned over who holds the title, but that whoever holds the title finishes the project," Roberts said.
A special governor’s commission has been talking behind the scenes with at least two developers to take on Xanadu. They include the Triple Five Group, a Canadian conglomerate that owns and operates the massive Mall of America in Minnesota and the West Edmonton Mall in Canada, and real estate mogul Stephen Ross, whose firm, the Related Companies, has been in negotiation with the state in connection with a possible tax-exempt financing package.
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The $2 billion Xanadu complex, located alongside the New Jersey Turnpike in East Rutherford, was to feature an indoor ski slope, skydiving wind tunnels, a theater, the country’s tallest Ferris wheel and hundreds of retail shops.
But Colony and some of its partners ran into money problems last year. An affiliate of bankrupt Lehman Brothers stopped providing promised construction funds and alternate financing could not be arranged as the global recession also caused many prospective tenants to re-think their participation. Work was halted, the Ferris wheel canceled, and the inside took on the appearance of a ghost town. The outside, with its Lego-block exterior, became the object of derision.
The new lenders group now controlling Xanadu, which include Credit Suisse Group AG and Capmark Financial Group, said it is negotiating with several entertainment and retail operators that have the financial resources as well as the leasing and development expertise necessary to successfully complete the project. In a statement, the group said the new operator will be required to accelerate completion of the project, which will include refinishing the exterior of the building.