Developer ASTM North America unveiled its proposal for a $6 billion project to overhaul Penn Station on Wednesday – a plan that has already faced pushback for providing a potential windfall to Madison Square Garden owner James Dolan.
ASTM’s proposal is an alternative to the state’s own $7 billion plan to rehab the area. Gov. Kathy Hochul welcomed outside bids this week while announcing a Penn Station overhaul would proceed without a troubled project to build new office towers at the site with Vornado Realty.
The highly anticipated proposal would leave Madison Square Garden intact within a sleek new stone exterior structure. Officials said construction could be completed in less than six years with state approval.
The renovated Penn Station would feature two main train halls, a “glass-wrapped” mid-block building, a naturally lit passenger concourse and higher ceilings in place of the current cramped experience.
“Our vision will once again return Penn Station to be an iconic transit hub worthy of New York City with a grand entrance on Eighth Avenue, more light, more space, more accessibility and more efficiency,” ASTM North America Senior Vice President Peter Cipriano said in a statement.
The project also calls for tearing down Hulu Theater to clear the way for a new Eighth Avenue entrance. Officials said the move, which has drawn criticism from the MTA, would allow for a new Eighth Avenue train hall for commuters, better pedestrian traffic flow and much-needed improvements to the loading dock.
ASTM’s proposal has rankled some critics, including MTA officials, who have argued the plan to acquire Hulu Theater from Dolan would amount to a $1 billion bailout for Madison Square Garden.
Cipriano disputed what he described as “unfortunate information” about the Hulu Theater proposal, stating that the “total acquisition cost” for the entire project “would be less than $500 million, not a $1 billion or more has been suggested.” He rejected the notion that a deal for the theater would be a “giveaway” to Dolan.
To date, no deal has been finalized.
“A lot of hay has been made this theater acquisition. I think in 10 years, no one is going to be paying any attention to that whatsoever,” added Vishaan Chakrabarti, creative director of the Practice for Architecture and Urbanism, which is handling design for the site.
During a press briefing, an ASTM official claimed the MTA had “elected not to” review plans for the project.
An MTA spokesperson pushed back on that claim.
“It’s simply not the case,” the MTA spokesperson told The Post, adding that agency officials had met with the ASTM team earlier this year and requested additional documentation, including a legal brief related to the proposal, but haven’t heard back.
The project officials cited the success of other recent public-private partnerships, including updates to LaGuardia Airport and the Moynihan Train Hall.
Chakrabarti said the revamped Penn Station would serve as the “jelly in the doughnut” necessary for an improvement for the entire neighborhood.
ASTM’s team called the $6 billion price tag a “fully wrapped” solution for the project that included the cost of construction, design, property acquisitions and long-term asset management.
The firm said it would commit $1 billion in “upfront equity” to acquire necessary property from Madison Square Garden.
A further $2 billion would come from public funding – including a projected $1.5 billion loan from a Federal Railroad Administration loan derived from the Biden administration’s bipartisan infrastructure bill and $500 million in state funding from New York’s existing appropriations budget.
The remaining $3 billion would be drawn from loans through the Department of Transportation.
Once construction on the site was completed, ASTM would remain involved to oversee operations and maintenance at the revamped Penn Station site for a 50-year term – during which it would receive annual payments from Amtrak, the Long Island Rail Road and New Jersey Transit.
ASTM officials said the annual payments were expected to be about $250 million – money that would cover any maintenance costs and be “constrained” by the station’s financial performance.
Earlier this month, MTA released a bombshell report declaring that Penn Station and Madison Square Garden were no longer compatible together.
