01
May
2003

New York Considers Plans for Area West of Midtown

Real Estate & Construction Advisor & Alert

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PUBLISHED ON: May 1, 2003

At any given time, New York’s Department of City Planning is preparing plans for some parts of the city. These plans can include zoning changes, as well as investments by the city in infrastructure. They can entail area-wide changes to the zoning map, changes to the zoning law, and/or the implementation of special zoning districts. A major new proposal is now in the works.

Even as the evolving plans for the reconstruction of the World Trade Center site are being widely discussed and publicized, the Department of City Planning is now in the process of developing a plan that has the potential to be of long-term significance to the city equal to or greater than the rebuilding at Ground Zero. That plan is for the area between 28th and 42nd Streets from Eighth Avenue to the Hudson River, which is referred to as the “Hudson Yards.” The need for this plan is evident. Services are the city’s economic lifeblood. As that sector grows, the need for buildings in which to house it is also growing. At the same time, the principal central business district—Midtown Manhattan—is running out of land to absorb significant new office building development. The only direction where significant expansion can occur is to the west.

Hudson Yards Area Ripe for Reuse

The area west of Eighth Avenue and south of 42nd Street is underutilized, containing a mix of uses, including warehouses, garages, parking lots, a Long Island Railroad storage yard, and the Javits Convention Center. The area contains relatively little housing. The Javits Center itself is in need of enlargement. As the 17th largest convention center in the
U.S., it is too small to accommodate some 60 annual conventions. Another drawback is its poor accessibility. The Javits Center has no nearby subway service and is not within walking distance of restaurants and hotels.

The entire Hudson Yards area has remained underdeveloped for years in large part because of the lack of convenient subway service (The nearest north-south line is at Eighth Avenue and the nearest east-west service, the No. 7 train, terminates at Times Square).

These issues have been brought into sharp focus by the prospect of having New York host the 2012 Olympic Games. A key element of the city’s plan for the games is a new stadium. The proposed location of the stadium is on top of the Long Island Railroad yard that extends from 30th Street to 33rd Street between 10th Avenue and the West Side Highway. Although consideration was given to having this stadium serve as expansion space for the Javits Center, that concept has been shelved in favor of an expansion of the convention center to the north. But the Jets are interested in the stadium after the Olympics, and the Hudson Yards area is being eyed as the possible site of a new Madison Square Garden.

A Critical Element—New Subway Service

Central to the stadium and any other significant new development in the Hudson Yards area is subway service. Plans are now under way to extend the No. 7 subway line westward and southward, then looping around in a northerly direction. The MTA is now looking at alternate routes and station locations and is conducting the required environmental review. When the subway line is opened, the area will be ripe for redevelopment at much higher densities than are now permitted by the zoning.

The Department of City Planning expects to have a zoning proposal ready sometime in late spring 2003. It will probably not be enacted into law before winter 2004-2005. Although the plans are still being refined, the Department of City Planning has given preliminary indications of what it intends to do. Much of the Hudson Yards area now zoned “M” (for manufacturing and related uses) will be rezoned to “C” (commercial, usually including residential uses) and “R” (residential and related uses). The Department has said that office buildings, to be situated at the edges of the area, are likely to be proposed at density levels similar to Midtown’s. The core of the area will also be zoned for significant density increases.

What does this mean for the property owner in or near the Hudson Yards area? First and foremost, property values will increase dramatically as the range of uses is expanded and higher densities are proposed. Indeed, the very announcement of the City’s intentions has undoubtedly already increased the level of real estate speculation in the area. But the area will not be redeveloped overnight. The Department of City Planning anticipates that that the full build-out of the area will take another 35 or more years.

The Hudson Yards proposal will also have implications for adjacent areas. As the garment industry continues to shrink, buildings in the Garment District are likely to be converted to residential use, many within walking distance of the Hudson Yards area. Interest in the area north of 42nd Street to the west of 10th Avenue will intensify.

The Importance of Vigilance

What can a property owner do at this stage? The most important thing to do is follow the planning process closely, particularly when The Department of City Planning issues its zoning proposal. If a parcel is just outside a proposed higher or highest density zoning district, it may be possible to make the case that the district boundary should be relocated. If a special zoning district is proposed, the provisions of the zoning text should be carefully scrutinized. If the proposal contains provisions that negatively affect a particular parcel, it may be possible to make the city aware of the consequences, which are not always obvious to the drafters of zoning the zoning resolution. Furthermore, political pressures may result in changes to the proposal after it is released. For these reasons, affected property owners, including those in adjacent areas, should be sure to stay informed about the Hudson Yards plans.