EAST RUTHERFORD — New Jersey has agreed to give the company that owns Mall of America up to $200 million in tax breaks as part of a deal to finish the troubled mega-mall retail and entertainment complex at the Meadowlands, according to published reports. Late last year, Triple Five, which owns the Mall of America in Minnesota and the...
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The multi-colored exterior to Xanadu in East Rutherford. The project's latest developer will rename the maligned facility.EAST RUTHERFORD — New Jersey has agreed to give the company that owns Mall of America up to $200 million in tax breaks as part of a deal to finish the troubled mega-mall retail and entertainment complex at the Meadowlands, according to published reports.
Late last year, Triple Five, which owns the Mall of America in Minnesota and the West Edmonton Mall in Canada, signed a letter of intent with lenders to complete the development of the complex, known as "Xanadu," and to possibly expand it.
Citing sources familiar with the negotiations, The New York Times reported today the tax breaks to finish the project will come in the form of sales tax revenue the company would use to pay off a state-sponsored financing package. The Record of Woodland Park also reported the deal.
A spokesman for Gov. Chris Christie and one for Triple Five declined to talk about the financial details.
It's unclear whether the state will get a stake in the property. The governor has said he would not support using any state money on the project unless the state gets some equity.
"If they want a state investment, we get a piece of the action," Christie said in March.
"We'll have more to say soon on the state's role and participation of the project," said Christie spokesman Michael Dreniak.
Triple Five spokeswoman Maureen Bausch told The Associated Press that a joint announcement was planned Monday.
The sprawling $2 billion complex originally was projected to open in late 2007. It was supposed to feature shops, an indoor snow dome, a movie complex, bowling alley, restaurants and an upscale martini bar. But as financing fell through, it remained empty, with its most noticeable feature being its multi-colored exterior.
The decor, which cost an estimated $40 million, has been a source of curiosity for motorists on the Turnpike and a joke for late-night comedians. It features rectangular panels of orange, brown, blue and lime — a combo that Gov. Christie has said makes it the ugliest building in New Jersey.
Despite the exterior, the property remains prime real estate. Located about 10 miles west of New York City, it is next to the Izod Center and across a highway from the $1.6 billion New Meadowlands Stadium that is slated to host the 2014 Super Bowl.
As part of the deal, Bausch said the exterior will be changed, as will the name. The complex will now be called American Dream Meadowlands.
"The American dream is about opportunity and we see this as an opportunity for a lot of people," Bausch said, adding that the nearly 9,000 construction jobs and 35,000 full-time jobs would be created as a result of the restarted development.
She said that all of the attractions originally planned will be part of the new complex, as well as an expansion that will eventually include an amusement and water park. The new project is planned to open in the fall of 2013.
Not everyone is thrilled about the deal and the financing, especially at a time when the state is cutting services to balance its budget.
Since 2007, the project has received more than $900 million in public subsidies and tax breaks and $300 million in property tax exemptions, prompting cries from some that the governor was giving away tax breaks at a time he needs revenue to balance the state budget.
"This bailout is corporate welfare," said Jeff Tittel, director of the New Jersey Sierra Club. "At a time when property taxes are rising, police are being laid off and government services are being cut, New Jersey taxpayers will be subsidizing a shopping mall."
"It is the wrong project in the wrong place at wrong time, and the governor wants to use our taxpayers to bailout the developer," Tittel said.