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1B deal to develop West Side yards collapses

By David Freedlander | dfreedlander@am-ny.com

8:17 PM EDT, May 8, 2008

A plan to remake the Hudson Yards on Manhattan's west side appear dead after negotiations with the developer collapsed Thursday, the Metropolitan Transportation Authority announced.

Real estate firm Tishman Speyer won the right to build on the vacant rail yards, known as Hudson Yards, with a more than $1 billion bid in March, beating out several other developers.

But on Thursday, Jeremy Soffin, MTA spokesman, said that the firm did not want to close on the eastern part of the rail yard until the city rezoned the western end, a move he described as reneging on a previous agreement.

Soffin refused to speculate on what the next steps may be, and phone calls to the real estate firm were not returned.

"We are still committed to developing Hudson Yards and we are looking at options," Soffin said.

Tishman's plan for the 26 acre area included 8 million square feet of office space, 13 acres of public space, more than 3,000 residential units, and 550,000 square feet of retail space.

They also had committed to spending more than $2 billion to construct a platform over the rail yards.

Negotiations between Tishman and the MTA had been ongoing for weeks, and the agency already extended the deadline twice.

Plans of what to do with the area hard against the Hudson River have beguiled different mayoral administrations for decades, but with the Tishman bid, many observers believed that at last something would get built on a underutilized area adjacent to some of the most expensive real estate in the world.

Finally completing a project at the rail yards had been one of the central elements Mayor Michael Bloomberg had hoped to leave behind as his legacy. In 2005, Bloomberg had proposed building a stadium for the New York Jets on the site, a plan that was squelched under opposition from neighbors and the state legislature.