Tuesday, May 18th, 2010 at 4:14 am
Jay-Z’s 40/40 Club franchise has suffered during this economic downturn. Hov had big hopes he would be able to expand into other markets successfully. However, expansion isn’t going well.
A Chicago club that was supposed to open in 2009, hasn’t. And the 80,000 square-foot Las Vegas club complete with 80 plasma TV’s totally flopped. Closing in 2008 after only being in business eight months because people in the ‘City That Never Sleeps’ just weren’t interested in it.
Jigga, Will Smith and Jada Pinkett invested $1 million into the Broadway musical ‘Felal’ which has yet to turn a profit.
Then there’s his stake in the lowly New Jersey Nets. Jay-Z was among a group of investors that bought the club in 2004 for $300 million. As it stands now six years later the club is worth only $269 million.
His portfolio took another big hit when he lost $50 million in bad hotel development projects, one in Chelsea and the other in New York’s Meatpacking District.
He also found himself caught up in a potentially messy scandal involving New York Governor David Paterson. Jay-Z’s friendship with the Governor came into question after he invested $2 million through his company Gain Global Investments Network LLC, into the development of a “racino” at the Aqueduct Racetrack.
The Feds started to investigate after rumors started to circulate that Jay-Z was given special favor by Aqueduct Entertainment Group, the company picked by Governor Paterson to turn the aging track into a slick gaming venue. Jay-Z eventually walked away from the investment completely.
Unfortunately, Jay-Z’s bad investments didn’t end there according to the Post.
He had two additional real estate deals go bad. Both in 2007, one in which he and his partners defaulted on a $24 million dollar mortgage.