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City and Extell buy property near Hudson Yards
June 8, 2007
By John Celock
The city appears to be buying up buildings next to the far West Side's Hudson Yards in order to build the Hudson Boulevard, which planners envision as an eight-block thoroughfare running from 42nd to 34th streets between 10th and 11th avenues. In a deal that recently closed, the city spent $66.1 million to buy 528 West 34th Street and a smaller adjacent building, 524 West 34th Street. Mega-developer Extell Development Company kicked in another $13.9 million to buy part of the properties, according to public records.
Extell, which is rumored to be planning a bid to develop the Yards, is also said to be eyeing development possibilities in areas near the Yards, according to J. Lee Compton, the chairman of Community Board 4. Gary Barnett, the president of Extell, did not return a call seeking comment on the purchase.
The building, a Federal Express distribution center between 10th and 11th avenues, sits on land the recently released Hudson Yards development guidelines have designated part of the Hudson Boulevard, which will run south from West 42nd Street, connecting to parks planned for the center of the new development. The planned parks in Hudson Yards, meanwhile, will connect to the existing Hudson River Park that runs parallel to the West Side Highway. In 2004, the city planned to seize the property via eminent domain in order to make way for the No. 7 train line extension, according to reports.
According to Compton,
the city has been acquiring buildings on the planned boulevard via eminent domain for the past 18 months. Public records show the purchase of 528 West 38th Street is registered to the city's Law Department, which oversees eminent domain proceedings. Lisa Bova-Hiatt, the deputy chief in charge of condemnation in the Tax & Bankruptcy Litigation Division at the Law Department--who represents the city on the purchase of property via eminent domain--was unavailable for comment.
The boulevard was originally conceived as an entrance to the stadium the Bloomberg administration wanted to build on the 26-acre Hudson Yards site two years ago. The city failed to win public support for the planned stadium.
In July 2005, Community Board 4 sent a letter to the city's Law Department stating that they were against the plan to use eminent domain to obtain properties for Hudson Boulevard. The letter also stated that with the stadium no longer on the table, that the board found the boulevard to be unnecessary.
"Once the stadium went away, the city did not see a need to eliminate this useless boulevard," Compton said. "It takes up an awful lot of space for not much, and it's a strange thing to be doing."
Compton noted that the community board has been fighting for the city to pay the property owners a competitive rate as they condemn the buildings for the construction of the boulevard.
The Hudson Yards development guidelines call for the 26-acre site to hold both residential and commercial buildings, topping off as high as 50 stories. The plan has generated recent controversy over the amount of affordable housing that will be offered on the site, the need for the construction of infrastructure to support an influx of residents, and the preservation of the High Line along the Yards' southern border.
The MTA originally promised to release the request for proposals to develop the Yards by the end of May. An MTA spokesman now says the RFP will be released soon, but did not give a firm timetable for the release. The delay in releasing the RFP calls into question the MTA's May statement that review of bids would begin in the early fall. While the RFP has not been released, several developers are reportedly preparing bids for the site, which the MTA expects will sell for around $1 billion.