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Related, Goldman Sachs Step into Hudson Yards Breach

By

Dave Hogarty

Published May 19, 2008

Modified May 19, 2008

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By

Dave Hogarty

Published May 19, 2008

Modified May 19, 2008

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The MTA has called a special board meeting to approve a takeover of the Hudson Yards development project in Manhattan by developer The Related Companies and investment bank Goldman Sachs. The quick switch follows an abrupt departure by real estate development firm Tishman Speyer, that won approval after a tortuously long selection process. An MTA press release quotes Mayor Bloomberg:

"Today's announcement that the MTA will award Related Companies, in partnership with Goldman Sachs, the development rights for the West Side Rail Yards is great news for the City. Despite the setbacks of the last few weeks, we are certain that Related and Goldman will realize this tremendous opportunity to develop what is really the only large parcel of undeveloped space left in Manhattan. The attractiveness of this area for developers stems in part because the City is funding an extension of the #7 line, making this vital new mixed use community of residential, commercial and office space a truly transit oriented development. We will continue to work with the State and MTA and with the developer to help make the Hudson Yards development a reality."

It must have been a busy weekend, because everyone is on board--Mayor Bloomberg, Gov. Paterson, MTA Chairman Dale Hemmerdinger, and the heads of The Related Companies and Goldman Sachs. Just last week, Mayor Bloomberg was clinging to the thin string of hope that the Tishman-Speyer bid could be salvaged.

There's no word yet on who would be the anchor tenant of the new mixed-use development, that would blend affordable housing, very expensive housing, and commercial and retail space. Morgan Stanley was supposed to be Tishman Speyer's anchor tenant. Goldman Sachs is in the process of erecting a new headquarters at the World Trade Center site, so it's questionable whether the bank would consider moving uptown. More details about the deal below:

Eastern Rail Yard (ERY)

The 13-acre Eastern Rail Yard (ERY), between 10th and 11th Avenues from West 30th to 33rd Streets, was re-zoned in January 2005 as part of the City’s Hudson Yards re-zoning, and allows for approximately 6.27 million square feet of mixed-use development (11 FAR), including office, residential, hotel, retail, cultural and parking facilities, and requires approximately seven acres of public open space.

The Related/Goldman Sachs plan, organized around a grand civic plaza, will construct:

• 5 buildings, 6.27 million sf total
• 1.67 million sf residential with 612,000 sf 80/20 rental (approx. 830 units) not less than 20% permanent affordable and 1.05 million sf condominium residences (approx. 692 units)
• 3.57 million sf commercial office
• 565,000 sf retail
• 265,000 sf hotel
• Dedicated area for 200,000 sf community/cultural
• 55% of site public open space

Western Rail Yard (WRY)

The 13-acre WRY, bordered by West 30th and 33rd Streets, between 11th and 12th Avenues, needs to now go through the City zoning/ULURP approval process. The Related/Goldman Sachs plan adheres to the design guidelines outlined in the MTA’s RFP, and the development consists of approximately 5.75 million sf, including:

• 8 buildings, 5.75 million sf total
• 3.63 million sf residential with 960,000 sf 80/20 rental (approx. 1,324 units) not less than 20% permanent affordable and 2.67 million sf condominium residences (approx. 1,927 units)
• 1.92 million sf commercial office within one building
• 192,000 sf of retail
• 120,000 sf PS/IS school
• Over 55% of site public open space

Special Features of the Proposal:

• 20% of the rental housing on-site at Hudson Yards will be permanently affordable (approximately 440 units), contributing to the diversity of the project and the shared vision by Related/Goldman Sachs, the State and the City for this great New York neighborhood.
• The High Line, which borders the Hudson Yards on the south and west, is retained as an integral part of the Related/Goldman Sachs proposal. The High Line will be rehabilitated and maintained as a linear open space.
• The Related/Goldman Sachs plan will achieve LEED certification by the U.S. Green Building Council, representing one of the most significant commitments to green development in the United States.

Tagged

bloomberg

goldman sachs

hudson yards

morgan stanley

MTA

paterson

the related companies

tishman speyer

Dave Hogarty

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