Xanadu Real Estate Project in NJ May be Turned Over to Creditors

A group of investors led by Colony Capital may pass on the high-profile Xanadu real estate project in New Jersey to creditors, The Wall Street Journal reported.

The clock is ticking towards an Aug. 9 to meet a deadline set by creditors including Capmark Financial Group, The Wall Street Journal reported without naming its sources.

Xanadu, in East Rutherford, was meant to be part of retail and entertainment center, and one of the top shopping locations in America. It has suffered after the Colony group was cut off from $500 million in financing when Lehman Brothers went into bankruptcy. Construction was halted early last year.

The creditors have now bypassed the Colony group and are speaking directly by to developer Related Cos.