Chris Christie’s Failed State Capitalism

In a case study showing that not all bipartisanship is good, New Jersey Governor Chris Christie, a Republican, has worked with his Democratic legislature to get his state invested in not one but two troubled real-estate megaprojects.

One is American Dream Meadowlands, a partly-built mega-mall just outside New York City that boasts an indoor ski slope. American Dream is more widely known by its former name, "Xanadu," but that name became so tainted by the project's troubles that rebranding was needed.

Construction on American Dream has been off and on since 2004, and in 2011, New Jersey put up $200 million to allow the $3 billion project to be completed. If and when the mall opens in 2014, we'll see whether Christie is right that state's investment will lead to job creation and robust sales.

We'll also see, before then, whether the property becomes any more visually appealing. In 2011, Christie called the unfinished mall "by far the ugliest damn building in New Jersey, and maybe America." Christie promised that de-uglificatgion would be a component of any restructuring deal. Having driven past it last month, I can attest that that hasn't happened yet.

Christie's other real estate venture, Revel Casino in Atlantic City, is already open -- and early returns are not favorable. Like Xanadu, Revel is a project that was conceived of at a time when the real estate market was strong and that stopped mid-construction when money ran out. And as with Xanadu, New Jersey re-started Revel's construction by agreeing to make a public investment in the project on favorable terms.

http://www.bloomberg.com/news/2012-08-10/chris-christie-s-failed-state-capitalism.html