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Hudson Yards Rezoning & Far West Side Development

New York City’s vision for the Hudson Yards district on Manhattan’s far West Side would transform the former manufacturing area into a new commercial and residential district, adding needed office space and housing. The project is a huge undertaking and has drawn skepticism and controversy – along with a number of delays and altered plans – but has simultaneously generated excitement around one of the last large underdeveloped areas in Manhattan.

In 2005, the City rezoned several blocks – from 28th to 42nd Street and between 8th and 12th Avenues – from manufacturing to commercial and residential uses. In total, the rezoning allows for up to 24 million square feet of office space and 13,500 new units of housing. The overall plan also created an inclusionary housing bonus to encourage affordable housing development and offered financial incentives to lure developers. The 2005 rezoning included a 13-acre parcel of the eastern portion of the MTA’s rail yards, which in conjunction with a western 13-acre parcel owned by the MTA, will comprise a mega mixed-use community. In December 2009, the City approved a rezoning of the western portion of the rail yards, the final holdout in the rezoning process. In exchange, Related agreed to build or preserve an additional 551 units of affordable housing, on top of the 743 units that were already part of the plan (Crain's NY).

The City’s plan for the Hudson Yards also includes the four-acre Hudson Boulevard and Park between 33rd and 42nd Streets and 10th and 11th Avenues, designed to function as a centrally-located park for the neighborhood. The city-led Hudson Yards Development Corporation is overseeing construction, which is expected to cost about $1 billion. The first phase of the park and boulevard development between 33rd and 36th Streets is slated for completion in 2013.

Crucial to the successful development of Hudson Yards is the planned extension of the Number 7 subway. Both the boulevard and subway extension projects will be paid for with public funds that will be paid back, in part, through the Hudson Yards District Improvement Fund. Developers in the neighborhood can contribute to the fund, created through the 2005 rezoning process, in exchange for density bonuses.

Initial plans for the far West Side also called for an expansion of the Javits Convention Center and the development of an anchor hotel. The expansion plans were scaled back greatly in 2007 because of cost overruns.

The MTA Rail Yards
In May 2008, the Related Companies won development rights for the 26-acre Hudson Rail Yards, which includes the eastern and western rail yards parcels. Development will require the construction of a platform over the rail yards (the yards will remain in use). Related Companies agreed to pay $1 billion over 99 years to transform the yards into an office and residential community. As planned, Related will build 5.5 million square feet of commercial space and 5,500 apartments (Crain’s NY). However, the Related deal has faced obstacles as a result of the economic slowdown. In February 2009, with financing for real estate projects difficult to obtain, the Related Companies came to an agreement with the MTA to delay closing on the project for a year, in exchange for a nonrefundable $8.6 million. Goldman Sachs, which had been partner in the development project, dealt the Related Companies a huge blow at the beginning of February 2010, when it announced it was pulling out of the project. Some speculate Goldman’s decision is a sign that the mega project is not feasible (Crain's NY). However, Related is moving forward and was able to negotiate another two-month extension with the MTA to pay $21.75 million by the end of March; the company will have to pay another $21.75 million over the course of the following year. Although it has not yet signed a contract with the MTA, Related released plans in 2009 for the 26-acre site, which includes about $15 billion in new development (NY Observer).

Expanding Midtown’s Commercial Core
If completed as planned, the Hudson Yards district (encompassing the entire rezoned area from 28th Street to 43nd Street) will become the fourth largest central business district in the United States, after Midtown, Lower Manhattan’s Financial District and the Chicago Loop (NYC Bar). The City envisions the Hudson Yards district as an expansion of Midtown – an area that officials say will not be able to accommodate projected employment growth over the next several decades. City officials believe that laying the groundwork for office development will stave off a future exodus of jobs to New Jersey or Long Island.

The Failed Stadium Plan
Despite some skepticism about the size of Related’s proposal, the current plans for a mixed-use community at the rail yards have drawn far less controversy than the City’s original plan to build a stadium for the New York Jets. The City originally included the stadium as part of its 2012 Olympic bid. However, Mayor Bloomberg continued to push for the project even after New York lost its Olympic bid, believing the stadium would be a linchpin for overall revitalization in the area; however, residents expressed concerns about congestion and the plan ultimately failed to win necessary state approval. Assembly Speaker Sheldon Silver (D-Manhattan) opposed the plan, expecting that rapid development of the far West Side would draw away from the ongoing redevelopment of Lower Manhattan.

Subway Expansion Plans Altered
City officials at the end of 2007 announced they would scale back the planned extension of the Number 7 train. The initial scope included an extension running from Times Square to the Javits Convention Center, with a station at 34th Street and 11th Avenue and a second in-between station at 41st Street and 10th Avenue. As a result of the economic downturn, however, plans for the 10th Avenue station were scrapped.

Construction on the subway extension and station at 11th Avenue is underway and is expected to be complete by the end of 2013. The extension passes under the site of the proposed 10th Avenue station, even though no station will be constructed. At the beginning of 2010, however, the Real Estate Board of New York organized a push to bring back plans for the 10th Avenue station, arguing substantial growth on the far West Side merits a second station. The organization has started a lobbying campaign to push for federal funding for the second station (NYTimes).

Javits Center Plans Scaled Back
Under the original plans set forth by the Pataki Administration, the convention center would have nearly doubled in size to 1.3 million square feet. The state also envisioned a 1,200-room anchor hotel to better accommodate convention-goers. But in 2007, Governor Eliot Spitzer (D) charged that costs had ballooned too high and decided to abandon Pataki’s expansion plans in favor of a greatly scaled-down version; in 2008, Governor David Paterson’s (D) administration terminated the bidding process for a proposed hotel, believing the market feasibility for such a large hotel needed to be reevaluated given the changes in the convention center plans (NY Observer).

In 2009, the Empire State Development Corporation approved a new plan that includes major renovations and the addition of exhibition space (albeit, much less space than proposed in the original expansion plans). Renovations to the existing center will include a replacement roof, efficiency improvements and new exterior doors. By the end of summer 2010, the state plans to complete construction on an 110,000-square-foot structure at 11th Avenue between 39th and 40th Streets, which will be used as the primary exhibition area during the Javits Center renovation. Once the renovation is complete, 80,000 square feet of the new space will remain in use to allow additional exhibition capacity at the convention center. All renovations are expected to be complete by 2014.

Last updated: March 8, 2010