NEW YORK, Sept 21 (Reuters) - A $2 billion real estate project in New Jersey, which stalled after a unit of bankrupt Lehman Brothers defaulted on a loan last spring, has suffered another financing setback.
A New York Supreme Court judge earlier this month dismissed a suit brought against a lender by the developers of Xanadu, a giant shopping and entertainment complex planned for the Meadowlands just across the Hudson River from Manhattan.
According to court papers, the suit was brought against Xanadu Mezz Holdings LLC, a Lehman unit whose default on a loan brought most of the work on the project to a halt. For more details, please click on:.
That forced developers to postpone a planned August opening. A spokesman was not immediately available to say when Xanadu will open or offer details about its financial negotiations.
The complex, which New Jersey Democratic Senate President once called 'The Mistake at the Meadowlands,' was expected to open two years ago.
The head of the agency in charge of the project said he remained optimistic.
'I've always said this was a two-step process,' Carl Goldberg, chairman of the New Jersey Sports and Exposition Authority, said by telephone.
The mall developers have persuaded lenders to agree to subordinate their debt to new loans that are now being negotiated, Goldberg said. That's the first step in the process.
'That's taken place...but they haven't put their new replacement construction loan group in place,' he said, which is the second step.
Goldberg said he was not aware of the court decision until the Star Ledger newspaper asked for his comments on it.
A spokesman for Democratic Governor Jon Corzine was not immediately available to respond to Republican criticisms that the authority was out of touch and that Xanadu had failed to create the jobs that were promised after a $1.5 billion bailout in 2006.
The case was brought in the Supreme Court of the State of New York; ERC 16W Limited Partnership v Xanadu Mezz Holdings LLC, No. 6008/70/2009.
(Additional reporting by Jonathan Stempel)
(Reporting by Joan Gralla; Editing by Diane Craft) Keywords: NEWJERSEY MEADOWLANDS/ (joan.gralla@thomsonreuters.com; Tel: +1-646-223-6345) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
A New York Supreme Court judge earlier this month dismissed a suit brought against a lender by the developers of Xanadu, a giant shopping and entertainment complex planned for the Meadowlands just across the Hudson River from Manhattan.
According to court papers, the suit was brought against Xanadu Mezz Holdings LLC, a Lehman unit whose default on a loan brought most of the work on the project to a halt. For more details, please click on:.
That forced developers to postpone a planned August opening. A spokesman was not immediately available to say when Xanadu will open or offer details about its financial negotiations.
The complex, which New Jersey Democratic Senate President once called 'The Mistake at the Meadowlands,' was expected to open two years ago.
The head of the agency in charge of the project said he remained optimistic.
'I've always said this was a two-step process,' Carl Goldberg, chairman of the New Jersey Sports and Exposition Authority, said by telephone.
The mall developers have persuaded lenders to agree to subordinate their debt to new loans that are now being negotiated, Goldberg said. That's the first step in the process.
'That's taken place...but they haven't put their new replacement construction loan group in place,' he said, which is the second step.
Goldberg said he was not aware of the court decision until the Star Ledger newspaper asked for his comments on it.
A spokesman for Democratic Governor Jon Corzine was not immediately available to respond to Republican criticisms that the authority was out of touch and that Xanadu had failed to create the jobs that were promised after a $1.5 billion bailout in 2006.
The case was brought in the Supreme Court of the State of New York; ERC 16W Limited Partnership v Xanadu Mezz Holdings LLC, No. 6008/70/2009.
(Additional reporting by Jonathan Stempel)
(Reporting by Joan Gralla; Editing by Diane Craft) Keywords: NEWJERSEY MEADOWLANDS/ (joan.gralla@thomsonreuters.com; Tel: +1-646-223-6345) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
© 2009 AFX News
