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Developer picked for Hudson Yards project

By David Freedlander and Marlene Naanes | mnaanes@am-ny.com

Bidding War On For Site Of Proposed West Side Stadium

The Hudson Rail yards in Manhattan is currenlty being bid on by the developers Tishman-Speyer and Durst-Vornado. The two developers are competing for the highly-coveted development contract along Manhattan Midtown waterfront. (Spencer Platt, Getty Images / March 25, 2008)

A developer with a $1 billion bid for a 99-year lease was selected Wednesday to transform the West Side Rail Yards into a glittering new highrise hub.

A project that would include commercial, retail, and residential space as well as a school and cultural facility, Tishman Speyer's proposal for the Hudson Yards is just the latest multi-billion dollar development project being planned for the city.

But some planners and historians are wondering if the Bloomberg administration's dream of a new city is waking up to a new economic reality. They say that a looming credit crisis, an economic downturn that has shown no signs of bottoming out, and a sharp increase in the cost of energy and raw materials will force developers to renege on some of their affordable housing and design promises.

"Some of the big infrastructure projects, whether it's the 2nd Avenue subway or the train from Lower Manhattan to JFK, seem like a reach now," said Kathryn Wylde, president of the Partnership for New York City, a nonprofit organization of business leaders.

"Hudson Yards will be a long-term project," Wylde said. "It's just a question of whether it's ten years or forty years, but I am confident that we will see a Hudson Yards."

With an already $2 billion price tag to build platforms over the rail yards, some fear that the West Side development could go the way of other mega-projects, such as the Atlantic Yards in Brooklyn and Moynihan Station, both of which have recently hit snags.

"Sometimes things call for big projects but more often than not they run aground," said Elliot Sclar, professor of Urban Planning at Columbia University.

Elected officials who announced the West Side rail yard deal at a news conference yesterday were more optimistic. Gov. David Paterson said that to move forward with the project in a rough economy would be analogous to the completion of Rockefeller Center during the Great Depression.

City officials were equally confident of the project's success, saying it would in the long term give the city much needed office space to keep and attract large corporations and bolster the economy.

"Regardless of the current slowdown in the economy, our long-term prospects really are bright for New York City if we make the decisions now that ensure our future," Mayor Michael Bloomberg said.

Jerry Speyer, Tishman Speyer Chairman and Chief Executive Officer, said construction on the site could begin as early as 2010 with some buildings appearing by 2013.

"We're committed to a fast track schedule," he said.

The Metropolitan Transportation Authority, the land owner, wrote into the deal financial penalties for defaulting on the project, which guarantees that at least eastern platform will be built, even if the company defaults, once construction begins.

Soldering on in the face of an uncertain future was precisely the thing to keep the effects of the recession from being felt worse than they ordinarily would, according to Tom Wright, executive director of Regional Plan Association.

"You spend when you are in a downturn to prime the pump, which is better for the short term and the long term," he said. "There is a pent-up demand from the public for bold thinking. We need new development projects."