Kathy Clown loses the Penn Station overdevelopment plan

NY Post

The powerful head of Vornado Realty Trust appeared to knock the wind out of Gov. Kathy Hochul’s plan to erect new office skyscrapers in the Penn Station area on Tuesday, when Chief Executive Steven Roth said the time is not right for major new development.

Publicly traded Vornado owns most of the 10 sites in the West 30s earmarked for large-scale rebuilding. Roth made the shocking retreat in an investors’ conference call on Tuesday. After he pointed out improvements Vornado has made in buildings near the station that it already owns, he seemed to call a pause in putting up any new ones.

“I must say that the headwinds in the current environment are not at all conducive to ground-up development,” Roth said.

Asked if it meant he would change or scale down the state-endorsed plan for the Penn Station neighborhood, he said, “That’s not something we’re going to get into now.” He apparently meant he wasn’t ready to discuss the matter.

 

Kathy Clown and Mayor Swagger agree on Penn Station real estate land grab deal

AP 

 A funding agreement was reached for the multibillion-dollar redevelopment of New York’s aging Penn Station, the country’s busiest rail hub.

Gov. Kathy Hochul and Mayor Eric Adams announced details of the deal Monday.

The plan would create new commercial and residential buildings around the station, with those building’s developers getting to make payments in lieu of taxes for a period of 40 to 45 years. The amount collected in excess of existing property taxes would be applied to the project.

That money would contribute more than $1 billion to pay for improvements to streets, sidewalks and other public spaces, as well as 50% of the improvements to transit infrastructure including underground concourses and subway entrances.

“This agreement brings us one step closer to a beautiful, modern station worthy of New York with vibrant open space, lively streetscapes, and better, more seamless connections to local transit,” Hochul said in a statement.

The reconstruction of the station and the first phase of the improvements to public spaces is expected to cost roughly $8 billion. Hochul’s vision is a scaled-down version of earlier plans announced by her predecessor, fellow Democrat Andrew Cuomo.

A recent study commissioned by Reinvent Albany, a state government watchdog group, estimated that the payments in lieu of taxes would amount to about $4 billion, a number that assumed a southern expansion of the station to accommodate more tracks when a new Hudson River tunnel is built several years from now. That expansion, which is in initial discussions, is projected to cost an additional $13 billion.

The plan has provoked criticism from neighborhood groups who contend it will destroy a vibrant area and displace residents and businesses.

Samuel Turvey, chairperson of RethinkNYC, a transportation and land use advocacy group, said the plan is misguided because it fails to turn Penn Station into a through-running facility where trains would pass through to other areas of the city, rather than turning around and returning to their origin or sitting in rail yards.

Turvey called the plan “a very ugly replacement theory where local residents, small businesses and historic structures are being cast to the winds with the help of the state and city.”

The Real Deal 

City and state officials have come to terms on paying for the renovation and expansion of Penn Station — some of it, anyway.

Gov. Kathy Hochul and Mayor Eric Adams announced on Monday an agreement over how the city will collect property taxes from the 18 million square feet of construction planned on sites surrounding the station.

As expected, the city will continue to collect the property taxes it receives now on the development sites, increasing by 3 percent each year. It will also get payments in lieu of taxes, or PILOTs, from the developers of each of the 10 future towers; the mechanism allows money to be directed to a specific purpose, in this case Penn Station work, rather than go into the general fund.

The property owners will not pay traditional property taxes on the increased value of the land for an extended period of time. The city will not collect the full property taxes on these sites until the agreed-upon contributions to the project are met or after 80 years, at the latest.

The PILOTs will cover 12.5 percent of the estimated $7 billion cost of renovating Penn, and of the possible expansion of the station, reportedly a $12 billion project. The payments will fully offset the cost of public realm improvements, such as street and sidewalk work, and will take care of 50 percent of the expense of transit work, including underground concourses and new subway entrances.

Adams called the deal a “win-win” for New Yorkers.

The announcement does not include many details on the expected value of the PILOTs, nor how they will be distributed between the renovation and expansion. It also does not specify how much the state expects to make from the sale of development rights in the neighborhood.

State officials released a copy of the financial framework late Monday afternoon. Opponents have complained that the project’s finances lack transparency.

Elizabeth Marcello, a research analyst with Reinvent Albany, a watchdog group that has been critical of the state’s plans for Penn, said the announcement further blurs the lines between the expansion and renovation of the station.

“There’s still a lot of glaring questions we don’t have answers to,” she said.

 

Seventh Avenue Holdout

 

 

NY Post

 Steve Roth, the 80-year-old billionaire real estate mogul, has a dream.

With the blessing of Gov. Andrew Cuomo, he wants to raze much of the area around Penn Station and put up 10 skyscrapers.

But 92-year-old Arnold Gumowitz is ready to spoil the relative whippersnapper’s hopes.

The real-estate mogul owns 421 Seventh Avenue, an office building across from Madison Square Garden that will need to be demolished if Roth’s controversial glass and steel supertalls are to happen.

But Gumowitz doesn’t want to sell the 15-story structure that he bought 43 years ago. It’s where he runs his commercial real estate empire, and where he still comes to work with his son every day.

He also definitely doesn’t want it demolished by eminent domain, a possibility he just found out about recently when he saw plans for the project with a drawing of a roughly 80-story tower in place of his own building.

“I look for fairness but when someone attacks me, I respond,” Gumowitz told The Post. “This is a generational piece of property. This is also a piece of real New York. I also hate to see this area become another impersonal Hudson Yards with nothing but tall buildings and no sunlight.”

Because the state declared the area “blighted” a year ago, Roth’s Vornado Realty and the Empire State Development Corp (ESD) — the state agency directing the project for Cuomo — have the right to tear down certain blocks in the designated area. At least 200 people will lose their homes and 9,000 employees will be out of work if the project goes ahead.

Gumowitz’ building sits at a critical spot for the planned Empire Station project: it’s in an area where the state wants to build a subway entrance and enlarge the sidewalk.

State officials, while cagey about whether they’d take Gumowitz’s building by eminent domain, indicated in a recent community board hearing on the issue that it’s a card they could play if they had to.

But to employ eminent domain, the ESD’s plan would have to undergo another review process, and a public hearing, said an official who did not want to be named.

They could also acquire the building through a negotiated sale.

Good luck with that, said Evan Cooper, who has worked for AAG Management, Gumowitz’s real estate management company, for 23 years.

“Roth and this project are coming at Arnold like a speeding train,” Cooper said. “But what they don’t realize is that Arnold is the immovable object.”

Progress at Farley, but what about Penn?

From PIX11:

The 106-year-old Farley Post Office Building is across the avenue from the busy transit center. New entrances have opened in the facility that lead to railroads.

A big project has been underway since 2016 and it is scheduled to open in 2020.

The new train hall will feature new platforms and tracks for LIRR and Amtrak and there will be commercial space.

From The Real Deal:

The City Council and James Dolan’s Madison Square Garden Company appear to be headed toward another clash over plans to relocate the iconic sports stadium.

Madison Square Garden is now at the midway point of the 10-year timetable the city laid out in 2013 for the stadium to relocate and make way for a modern Penn Station.

But with five years left on its special operating permit, MSG appears to have taken no significant steps toward what would be a years-long process of acquiring a new site and constructing a new stadium.

“We have not provided any public information” on the matter, MSG spokesperson Kimberly Kerns told The Real Deal.

Stakeholders such as the Regional Plan Association and the Municipal Arts Society that have called for the Garden to move said they have not been informed of any plans to do so. Madison Square Garden has not filed an application with the City Planning Commission to extend its special permit, and sources said the City Council hasn’t been made aware of the stadium’s future plans.

The City Council made it clear five years ago that it expected MSG to be gone by 2023, but a Council spokesperson would not say whether the legislative body expected the Garden to stick to the deadline.

Penn Station redevelopment sets off de Blasio-Cuomo feud

From PIX11:

In the shadows of Madison Square Garden, a storied boxing mecca, there's a political brawl between New York Governor Andrew Cuomo and New York City Mayor Bill de Blasio going on over the future of the Penn Station.

It's now entering "the championship rounds" after plans leaked of Governor Cuomo’s proposed re-envisioning of the neighborhood surrounding Penn. The plans did not appear to include input from his de Blasio or other local and community officials.

The Penn Station blues

From the Wall Street Journal:

Diverted passengers who face a grueling commute this summer because of rail disruption at New York’s Penn Station deserve discounted tickets on the Long Island Rail Road, New York Gov. Andrew Cuomo said Monday morning.

The Metropolitan Transportation Authority’s Suffolk County board member later suggested such a discount could be up to 15%.

As Mr. Cuomo made his suggestion, during a news conference at Penn Station, the head of the MTA, which owns the LIRR, told a committee of the agency’s board in lower Manhattan that the MTA will withhold regular payments it makes to Amtrak for use of Penn Station and that the MTA will send Amtrak a bill for costs incurred by the disruption.

Amtrak, which owns and operates the Midtown Manhattan terminal, will reduce weekday rush-hour service into and out of the station beginning July 10. The outages are needed so that Amtrak can carry out extensive repair work to rails and switches following two low-speed derailments earlier this year.

From NY1:

City Council Member Jimmy Van Bramer is not mincing words when it comes to his opinion on the MTA's plan for Long Island Rail Road (LIRR) riders this summer.

“I think it is ridiculous,” he said.

This week, the agency announced it would cancel or divert close to three dozen rush hour trains into and out of Penn Station while Amtrak does emergency track work. That means more LIRR trains originating or terminating at stations in Brooklyn and Queens, including Hunterspoint Avenue in Long Island City. Passengers there would then either take a ferry or transfer to the 7 train.

“To take Long Island Rail Road users and divert them to the 7 train is stupid,” Van Bramer said. “We know the service is unreliable as it is.”

From NY1:

A State Senator from Queens says taxing the rich is how to fund repair work at Penn Station.

Senator Michael Gianaris says his bill would require millionaires in New York to pay a three-year temporary state income tax surcharge. It would apply to those living in any county where the MTA operates.

Gianaris says it would generate close to $2 billion dollars for the MTA every year.

Hotel taxes would also see a new $5 fee on top of the already existing tax in the city.

Think tank's bright idea for Sunnyside

From Crains:

A Manhattan think tank is pushing a plan to end the misery of Penn Station commuters, who are having an especially horrid month, by recasting the West 34th Street hub as just another stop for New Jersey Transit and the Long Island Rail Road, rather than the terminus for both. Having trains pass through the station instead of stopping and turning around, which results in a daily traffic nightmare, would also open up possibilities beyond alleviating congestion.

Part of the idea, named ReThinkNYC, calls for moving rail yards in Sunnyside, Queens, to the Bronx. That way a major new transit hub could be built on the Queens site, connecting the region’s commuter lines and the subway system for a fraction of the cost of Mayor Bill de Blasio’s plan to build a deck over Sunnyside Yards. With that kind of transit access, a business district could sprout up around the station, taking advantage of a 280-acre blank canvas across the East River from the most expensive office towers in the city.

Cuomo unveils plan for new Penn Station

From NY1:

With its low ceilings and cramped corridors, Penn Station is anything but beloved by train travelers.

"It is decrepit, and it's an affront to riders who use it," said Governor Andrew Cuomo. "Well, why are you so negative on Penn Station? Because it's terrible!"

On Tuesday, Cuomo unveiled the latest proposal to make Penn Station a glorious terminal again.

The $1.6 billion renovation would move Amtrak and the Long Island Rail Road across Eighth Avenue into the Farley Post Office Building, to be renamed Moynihan Train Hall.

"New York will not have seen anything like it in decades," Cuomo said.

As part of the plan, the cramped concourses inside the existing Penn Station will be renovated and expanded to ease the space crunch for commuters.

"Right now, it's about 25 feet wide, so everybody's channeled in that cattle-call area," Cuomo said.

Cuomo says all the needed approvals and funding have been obtained, and that after decades of delays, the dream of a new Penn Station will finally be realized.

"I don't announce plans with caveats. This is what is going to happen," Cuomo said.

Homeless taking over Penn Station

From CBS:

Commuters say the homeless situation underground at Penn Station has grown out of control, and with cooler temperatures on their way, they expect to see even more move in.

CBS2’s Hazel Sanchez demanded answers Monday from city, state, and railroad officials.

CBS2 has found Penn Station has become a very popular homeless haven — and many commuters said they want to know how the situation has been allowed seemingly to spiral out of control.

What happened to Moynihan Station?

From the NY Times:

The owners of Madison Square Garden have been given an ultimatum: Make life more bearable for the hundreds of thousands of commuters who shuffle daily through the corridors of Pennsylvania Station crammed beneath the arena or face eviction.

The New York City Planning Commission voted unanimously on Wednesday to extend the Garden’s operating permit for 15 years, during which time the arena’s owners could either make plans to move or substantially improve the transportation hub.

“The best possible outcomes for the city would be a relocated Madison Square Garden coupled with a rebuilt Penn Station,” said Amanda M. Burden, the city’s planning commissioner.

The vote was the latest chapter in a continuing campaign that has been waged on and off for the last 50 years, ever since the original Penn Station was torn down. The destruction of that elegant station prompted a landmarks preservation movement that has saved numerous historical treasures in the city and across the nation.

When the bladder bursts

From the NY Times:

On the last Sunday in October, with the storm on its way, railroad workers in yellow slickers unrolled a 90-foot-long rubber bladder at the gaping mouth of a tunnel on the West Side of Manhattan. They began filling it with water, 32,000 gallons. Once engorged, the bladder stood five feet high. It was a formidable plug intended to defend Pennsylvania Station against Hudson River waters surging from the west into the train yards, and from there into the station.

The bladder stood five feet high once it was filled with 32,000 gallons of water.
The plan, as a news release from the Long Island Rail Road said, was “to fight water with water.”

It looked like a good, prudent idea. Then the storm came.

The force of the rushing water simply shoved aside the bladder — approximate weight, 133 tons — and the flood moved toward Penn Station. Only the pitch of the tunnel diverted it away from the station and into another tunnel. The bladder was left in shreds.

As one railroad worker said, “There was so much water in the yards, you could have gone surfing.”

That episode came to mind on Tuesday morning at the groundbreaking for a 26-acre real estate project at, and above, those same train yards — what Mayor Michael R. Bloomberg said was “one of the largest private developments ever undertaken in the country.” It is called Hudson Yards.

A hefty portion of the project’s 26 acres is within the 100-year-flood plain, just as the World Trade Center development is, farther south. At least for now, Hurricane Sandy does not seem to have slowed the momentum of history, more than two centuries of building right up to the margins of the three islands and mainland that make up New York City. Whatever shorefront once existed at the Hudson Yards site was long ago consumed, along with 300,000 other acres of tidal wetlands, as the city was hardened at its edges. The marshy land may have disappeared, but the tides have not gone anywhere.

Cosmetic surgery for Moynihan Station

From the NY Post:

Officials yesterday approved a $147 million contract to begin work on Moynihan Station — the start of an expected $1 billion face lift that includes cosmetic upgrades but no new tracks at teeming Penn Station.

Construction is expected to begin on Phase 1 by summer, with an estimated completion date of 2016.

That $270 million phase — funded mostly by the feds — will add two street-level entrances and station improvements to make navigating Penn Station easier.
What it won’t do is add new track space to the delay-plagued Penn, the busiest transit hub in North America.

Even the more ambitious and as-yet unfunded Phase 2 — which will bring retail, restaurants and a new Amtrak waiting area into what is now the James A. Farley post office — won’t add new tracks.

Henry Stern on another developer giveaway

From the Huffington Post:

...the skyline of New York City is ever-changing, and as generations of New Yorkers know, your view lasts as long as the owner of the lot next door allows. Property owners can build as of right on their land, consistent with zoning codes and city regulations.

In this case, however, the proposed tower was far outside the zoning codes, and required five separate changes in the law to give the developer the height and bulk of the building that he wanted to erect. That is why the Community Board and the City Council were involved under the city's Uniform Land Use Review Procedure (sometimes affectionately called ULURP).

If it is built, the proposed Penn Tower would have 56% more bulk than the zoning code would have permitted without discretionary bonuses. That comes out to almost a million square feet of additional office space. The variances granted to the developer also eliminate the setback regulations typically required for buildings of this size, thereby aggravating the impact upon the skyline from the perspective of New Jersey. The glare from night lighting of the financial tenants will further impact the view of the iconic Empire State Building from the east.

On this one, the CPC was clearly in the tank, abandoning its customary guardianship and attention to size, taste and design in its eagerness to approve the tower.

We believe that what happened in this case is a textbook example of unsound public policy, favoritism to a particular extremely well-connected developer, and lack of regard for the future of the commercial neighborhood around Penn and Moynihan Stations. To grant a massive upgrade to a property owner with no tenant, no financing and no immediate plans to build is premature and irresponsible. These valuable new rights will be for sale along with the property if the developer is unable or unwilling to build on the site.

This is a case of the city making an extraordinary gift, probably worth hundreds of millions of dollars, to one of its richest and most influential developers. It is a top-down decision, clearly made at City Hall and not by the Planning Commission, which should have been embarrassed at the tricks they had to turn.

You got it! Also, there is a major conflict of interest here because:

Ms. Quinn did not mention that a loophole has allowed Vornado Realty Trust to contribute thousands of dollars to her campaign even though the company, one of the largest real estate investment trusts in the country, has business before the city. Last week, Quinn and the council approved Vornado's controversial 15 Penn Plaza development, despite opposition from Community Board 5. - Crains

Hotel Pennsylvania not long for this world

From the NY Post:

Zone it and they will come.

At least that's what the developer of a proposed behemoth of a tower on the site of the Hotel Pennsylvania is hoping now that city planners yesterday approved zoning changes needed to build a skyscraper taller than the Chrysler Building.

The approvals more than double the size of a building that could go up on Seventh Avenue, between 33rd and 32nd Streets, where developer Vornado wants to build as much as 2.83 million square feet of office space.

Final approval rests with the City Council.

No construction is expected until Vornado signs a major tenant for the project.

Planning Commissioner Amanda Burden praised the proposed tower, citing its location across Seventh Avenue from the key transit hub of Penn Station.

The tower, with 67 floors and up to 1,216 feet, would be the city's third tallest after the Empire State and Bank of America buildings. But completion in 2013 of 1 World Trade Center, formerly known as the Freedom Tower, would bump the Penn Plaza tower down to fourth place.

No crime at Penn Station, either

MYFOXNY.COM - Five people beat and kicked a man outside of Penn Station while a crowd watched.

25-seconds of the video was posted on YouTube.

The attack supposedly happened on March 27.

It's unclear what provoked the fight.

Stimulus funds for Moynihan Station

From the NY Post/AP:

Sen. Charles Schumer says the federal government will award $83.3 million for a project to transform New York City’s main post office building into a rail gateway.

Schumer said Tuesday the funding will come from the American Reinvestment and Recovery Act.

The senator said the project would create thousands of jobs and kick-start development across the west side of Manhattan.

The new station is to be named after the late Sen. Daniel Patrick Moynihan.

It’s intended to increase capacity and restore some grandeur to the city’s main rail center. The Beaux-Arts landmark that was home to the original Penn Station was demolished in 1963. It was replaced by the Madison Square Garden arena.

And now, folks, you know what your federal stimulus money was really designated for - politicians' pet projects. As the Observer points out:

Taken in isolation, this first phase does not seem a project worth the significant money being devoted to it, and now the concern becomes whether the second phase will indeed ever happen.

Metro-North to Penn Station?

From NY1:

The MTA is moving forward with a long-term plan to bring Metro-North to Penn Station.

The agency is conducting an environmental study of how best to provide direct train service from its Hudson and New Haven lines to Penn Station.

The proposal includes daily Hudson Line service using Amtrak's Empire Connection with two new stations near West 125th and the Upper West Side.

Daily New Haven line service via the Hell Gate line would also undergo some changes including three new stations in Co-op City, Parkchester and Hunts Point.

While the plan is still in the early stages, the environmental assessment is expected to be complete by 2011.

Delay in plan to link Penn and Grand Central

'GRAND' LIRR LINK STALLS
By TOM NAMAKO, NY Post

The mammoth $7.2 billion project to extend the LIRR from Penn Station to Grand Central Terminal is not on track to make its February 2015 deadline, according to a new MTA consultant report.

Chronic delays with four contracts put the completion date "under pressure," said the firm McKissack and Delcan.

And delays cost money, transit advocates warned yesterday, saying the federal government won't provide any more than the $6.2 billion already approved for the project.