"What's lost in the debate is that we as a state make decisionsin a 'silo' world when we live in a global world," said TimothyTouhey, a long-time state official who is currently EVP of the NewJersey Builders Association. "Some 65% of mortgages in the US arebacked by foreign investors. So you don't interact without knowingwhat's going on in the world."

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As far as market conditions themselves, "most of the meltdownshave happened," he said, referring to lender woes. "It will takeanother year to play out. All of this fed off the housingmarket."

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For New Jersey, "it's a hard time getting equity in the market,but we'll get out of this," he predicted. One investment niche, inhis view: Commercial banks. While they're not necessarily bringingcapital to the market, "the banks are looking for cash forsecurity."

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In some ways, he admitted, New Jersey's notorious regulatoryenvironment might have ironically helped the state. Because it'stough to get projects done, "New Jersey is not overbuilt and is notsuffering like places like Nevada, Texas, Florida, Ohio andMichigan. We didn't experience the dramatic overstock like otherplaces."

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And referring to a new legislative initiative by acoalition of business leaders, "if the state positions itselfcorrectly, we can really run with this," Touhey concluded.

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Government was the focus of remarks by Anthony Pizzutillo ofSmith Pizzutillo Public Affairs of Princeton, who's also the chieflobbyist for NJ-NAIOP. "I've worked with four or fiveadministrations [in Trenton], and I haven't seen anything like thisbefore," he said. "We are going into the third year of the Corzineadministration, and responses to the economy are stilllacking."

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Pizzutillo specifically took the Corzine administration to taskfor what he perceived as inaction in the face of an economy thathas been losing knowledge-based jobs and replacing them withlow-paying jobs in such sectors as retail and healthcare. He did,however, commend the administration for "bringing the financialrestructuring of the state to a debate. It has to be changed," hesaid, of New Jersey's ongoing budget woes.

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And in the larger sense, "we do need to encourage economicdevelopment," he said. "Eminent domain isn't running rampant. Wecontinue to improve redevelopment law. New Jersey is poised to bevery pivotal in the 21st century with the infrastructure we have inplace as we move to a post-fossil fuel economy."

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Gil Medina, executive managing director of Cushman &Wakefield, told attendees "we have to start looking at theproduct," referring to what New Jersey has to offer. "Overall, wehave a good product, but it has defects. It is increasinglydifficult to sell that product without some changes."

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Medina said that "we have lost our competitive posture in manyof our important sectors," specifically noting telecom. He diddefend the Corzine administration to the extent that after the waythe state's economy has performed over the past 30 years,"expectations were high," perhaps too high given the currentchallenges.

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"The administration doesn't have enough EDA types," Medina said."The governor's intentions are good, it's not an omission ofintegrity, but if more EDA people were involved," instead of formerWall Street executives, matters might be different.

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"Government can make a difference, but unfortunately ourgovernment is making a difference in the wrong direction," Medinasaid. "We're not losing because of a lack of incentives--we havegood programs. We're losing because the incentives sometimes don'tovercome the regulatory climate. Economic development officials areimportant, but they haven't been given enough of a role."

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