The financing plan for New York’s Penn Station redevelopment project was recently approved by the Public Authorities Control Board. This proposed reconstruction covers not only features of the train station, but also includes several buildings within the surrounding neighborhood. Earlier this year, an analysis was conducted on the project which revealed $22 billion as its total cost. Out of this projected cost, $7.2 billion is expected to cover just the Penn Station’s revitalization.
Gov. Kathy Hochul, mentioned that the vote was a major milestone in the Penn Station project. She spoke about how the train station had been overcrowded, cramped, and neglected for far too long. However, Hochul anticipates that the project will not only fix Penn Station but also transform the neighborhood surrounding it.
New York City’s economic development agency was responsible for approving the redevelopment plans for this long overdue Penn Station project.
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Plans for the Penn Station redevelopment project
The rail system’s $7 billion renovation covers reconfiguring the train hall, serving NJ Transit and Long Island Rail Road. In addition, it also includes subway improvements and the construction of a rail tunnel under the Hudson River.
Furthermore, the Penn Station project will feature other developments around the neighborhood such as commercial spaces, offices, and retail components. These are meant to be spread across 10 skyscrapers, which will make the neighborhood more office-centric. Plans also call for 1,800 housing units and a hotel.
The parties financing the Penn Station redevelopment project have been agreed on, along with the percentages they will be paying. This has been split 3 ways, with 50% of the cost to be covered by the federal government. Meanwhile, New York and New Jersey will share the remaining costs evenly. Another source of funding stated in the financing plan will involve charging the developers of the 10 skyscrapers. Especially Vornado Realty Corp., which will be charged a fee instead of city real estate taxes. This is a special financing arrangement known as Payments In Lieu of Taxes (PILOTs).
In the next phase of the Penn Station redevelopment project, the site selection process will begin. Followed by the governor’s selection of a design for the new train by summer or early fall. This design will include a skylight and more floor space than Grand Central Terminal. In addition to this, the governor has also promised to rename the station.
