The Hudson River Park Trust (HRPT), in collaboration with local elected officials, is seeking to revise its enabling legislation to allow for commercial development at Pier 40, the massive former cruise ship terminal on the Hudson River waterfront, adjacent to Houston Street, which covers 14 acres and now houses athletic and recreational facilities.
“The major issue is that there need to be changes to the legislation that created the Hudson River Park, because Pier 40 is sinking,” explained Anthony Notaro, chair of Community Board 1 (CB1) at an April 26 meeting. “They need to have a revenue stream not only to rebuild it, but to sustain it. But there are active ballfields there, to which we need to maintain access.”
This revelation comes more than a year after Governor Andrew Cuomo announced, in April, 2018, to much fanfare, that he was pledging $50 million to complete the Hudson River Park, which was originally slated for completion in 2006. But that offer came with a large string attached: his political sparring partner, Mayor Bill de Blasio, was required to match this with $50 million in City funding. That total of $100 million was described by both the Governor’s and the Mayor’s representatives as being sufficient to “finish” the park, but this appeared unlikely from the outset. Although the HPRT estimates that more than 77 percent of its original plan is now complete, it also projected that the total price tag to finish the remaining portions at approximately $617 million.
That noted, the HPRT has other significant sources of revenue. A large new residential and retail complex will soon rise on the site of St. John’s Terminal, a former rail freight facility adjacent to Pier 40 (straddling Houston Street, stretching from Vandam to Clarkson Streets). This project would not have been possible without a transfer of 200,000 square feet of air rights from Pier 40, for which the HPRT was paid $100 million. This payout is expect to cover most of the cost of rehabilitating the underwater supporting structure of Pier 40, which has been deteriorating for decades. Work on shoring up the Pier (estimated to cost $104 million) began in late 2018.
But significant additional air rights remain within Pier 40. Although it would be difficult for HPRT to sell these to another developer outside of the Park (its enabling legislation bans transfers more than one block away from the waterfront), these rights could allow the development of new space on the Pier itself. The Trust plans to preserve the current, recreational uses of Pier 40, which serves as an athletic facility for many local sports leagues, while also adding commercial uses, which could include offices, retail space, or a hotel.
“Pier 40 is a very key element of the Hudson River Park,” observed Paul Goldstein, who chairs CB1’s Waterfront Committee, at the April 26 meeting. “It not only serves many communities with recreational facilities, including our leagues down here, but it is also one of the designated sites to generate revenue for the Park, which is supposed to maintain itself and pay for future development.”
“Coming up with a plan to maintain that flow of cash and to continue to improve that pier is vital, but it has been a very difficult issue,” he continued. Community Board 2 (CB2), which has jurisdiction over Pier 40, “has turned down at least two development proposals that they found inappropriate. Following that, there has been discussion with CB2 and some of the local elected officials about a tentative plan to put commercial office space on the Pier. That seemed to be the use that the different entities had some common agreement on.”
“Obviously, there’s a lot to be worked out on the details,” Mr. Goldstein added. “One of the bottom lines is that has to go through the State legislature, because the Hudson River Park Act is a State law. And this use, commercial development, is not allowed now. So they would have to amend the Act. They have until basically mid-June to do so. The elected officials have given us the impression that they would like to get something done.”
Apart from development at Pier 40, the Trust also expects to derive significant revenue from the imminent redevelopment of Pier 57, near 15th Street, where Google has signed on as an anchor tenant. The planned office-and-retail complex, which will encompass 480,000 square feet of space, which will eventually contribute several million dollars per year to the HRPT’s balance sheet.
In the longer term, HRPT hopes eventually take over Pier 76 (in the West 30s, adjacent to the Javits Convention Center), which currently functions as the New York City tow pound. This facility currently encloses 245,000 square feet, and adjoins an upland, open-space area of another 55,000 square feet. From this total, the Trust hopes to create slightly more than 178,000 square feet (or just over four acres) of new parkland, while setting aside 122,000 square feet for commercial development. At the Park’s southern extremity, HPRT officials have spoken publicly about the possibility of selling unused air rights from the Park’s Tribeca section to any possible redevelopment of the Borough of Manhattan Community College Campus.
Overall, the Trust estimates that it already has commitments for approximately $426 million of the $617 million it will need to complete the Park in the next ten years, or some 69 percent of the total. These have come from sources such as air rights sales, private donations, and appropriations from the City and State.
The remaining gap of $189 million, or 31 percent of the total cost, would be more than half bridged by the $100-million allocation that the State and City announced in 2018. But, with a remaining deficit of almost $90 million, this subsidy would not, by itself, quite live up to the billing of “finishing the Hudson River Park” that the Governor and the Mayor have boasted of.
Wherever the funding to complete the Park comes from, however, allocating resources to HPRT appears to be a sound investment. A 2016 analysis from the Regional Plan Association (RPA) concluded that the $720 million earmarked for the Hudson River Park since construction began in 1998 has yielded $1.121 billion in indirect economic benefits for New York City (as well as another $305 million in similar benefits for the State as a whole), while new building projects adjacent to the Park represent one-fourth of all the newly created square feet of property in Manhattan built between 2000 and 2014.
During those years, RPA also concluded, property tax contributions within the Hudson River Park neighborhood grew 28 percent faster than in Manhattan as a whole. The same report also noted that the Park directly generates more than 3,000 full- and part-time jobs — a figure that is projected to swell to approximately 5,000 jobs over in the next few years.
Matthew Fenton
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