The Hudson Yards Project
June 18, 2013
HUDSON YARDS DEVELOPMENT CORPORATION
Hudson Yards Project Area
Hudson Yards Area is bounded by West 43rd Street, 7th & 8th Avenues, West 30th Street and 12th Avenue
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HUDSON YARDS DEVELOPMENT CORPORATION
The Redevelopment Opportunity
Looking north from West 28th Street Looking east from West 31st Street
Antiquated and restrictive zoning
Poor mass transit access
No public open space
Large tracts of under-developed land devoted to public transportation uses
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HUDSON YARDS DEVELOPMENT CORPORATION
Master Plan: Caemmerer West Side Yard released by the
MTA (1988)
•Plan proposed a mixed-use development of the MTA Rail Yards and the block south of the Javits Convention Center
•Report concluded a rezoning was necessary to permit a floor area ratio of 12 to support the plan
•Success of plan contingent upon extension of rapid transit access to the area
Special Jacob K. Javits Convention Center
District Created (1990)
•Established to facilitate mixed-use development adjacent to the Javits Convention Center
•Permitted FAR as high as 10 for residential, office, hotel, and community facility uses on sites surrounding the Javits plaza
•No development resulted
City Planning Commission Study of
the Hudson Yards Area (1993)
•Shaping the City’s Future report concluded that expanding existing CBDs was essential to accommodate long-term growth
•Hudson Yards was identified as an extension of the Midtown CBD
•Report concluded that the City must ensure “that appropriate as-of-right zoning is in place to accommodate expansion and future office needs.”
•The report suggested extending the No. 7 Subway west through Hudson Yards and on to New Jersey
The HY Idea Takes Shape
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HUDSON YARDS DEVELOPMENT CORPORATION 4
The HY Project Plan Evolves
•Study linked land use and future development with expansion of mass transit
•Existing conditions analysis of HY area focused on land use, transportation infrastructure and services, and the area’s tax base
•Transportation analysis of whether the street network could support additional development
•Identified the need for a “self-financing” model for the subway extension
DCP Study of Extending the No. 7
Subway Line to Hudson Yards (1999)
•Identified the need for a transit-oriented mixed-use extension of the Midtown CBD
•Established three essential components for redeveloping the HY area:•Rezoning to allow for millions of square feet of mixed-use development
•Construction of the No. 7 Subway Extension
•Creation of open space amenities to attract businesses, residents, and visitors
Far West Midtown: A Framework for
Development (2001)
•DCP and NYCEDC engaged a multi-disciplinary urban design team to create a master plan for HY in 2002
Master Plan (2002)
•City of New York hired consultants Economics Research Associates (ERA) and Cushman & Wakefield (C&W) to forecast long-term growth of office-using employment (OUE) and to analyze HY’s ability to capture future demand for Class A office space in Midtown
Demand Study (2002)
•DCP releases Preferred Direction Plan for HY in 2003
•PDP confirmed the need for the three project components outlined in the 2001 Far West Midtown report
Preferred Direction Plan (2003)
HUDSON YARDS DEVELOPMENT CORPORATION
The Public Sector Organizes
City creates the administrative structure to execute the HY plan
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HUDSON YARDS INFRASTRUCTURE CORPORATION HUDSON YARDS DEVELOPMENT CORPORATION
Created in 2004 Created in 2005
Oversees project financing and cost containment Responsible for the implementation of City’s HY development program
Board members:
OMB Budget Director
Deputy Mayor for Operations
Deputy Mayor for Economic Development
City Comptroller
Speaker of City Council
Board members:
All five HYIC Board Members, plus: Commissioners of SBS, Parks, HPD and City
Planning President, NYCEDC Manhattan Borough President Council Member for District 3 Community Board 4 Chair
Staffed by City’s Office of Management and Budget 7 full-time employees
HUDSON YARDS DEVELOPMENT CORPORATION
HYDC
DOT
DEP
DCP
DPR
NYCEDC
MTA
MVVA (Park Designers)
Developers
Community
City Hall/OMB/HYIC
Managing the HY Project
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HUDSON YARDS DEVELOPMENT CORPORATION
Land Use
Predominantly residential
Mixed use
Predominantly Commercial
Open space
Cultural
12/1912/19
6.5(10)/136.5(10)/13
6.5(10)/126.5(10)/12
10/19.510/19.5
10/1810/18
666.5/156.5/15 66
1111
10/3310/33
7.57.5
10/1510/15
10/1210/12
1010
6.5/ 13
6.5/ 13
10/2410/24
10/21.610/21.6
10/2010/20
10/1210/12
10/3310/33
10/2410/24
10/ 21.610/
21.6
34th St.
42nd St.
8th A
ve.
10th
Ave
.
1010
The 2005/2009 Rezonings
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HUDSON YARDS DEVELOPMENT CORPORATION
Hudson Park & Boulevard
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Hudson Park and Boulevard → Clockwise: Block #1 (West 33rd/34th Streets); Block #2 (West
34th/35th Streets); and schematic design of park
and boulevard;
33RD ST
35TH ST
36TH ST
34TH ST
HUDSON YARDS DEVELOPMENT CORPORATION10
34th S
treet33rd S
treet
11th Avenue
Future 34th
Station
Entrance
Vent
Building
Hudson Park & Boulevard
Construction Status – Site J (June 2013)
HUDSON YARDS DEVELOPMENT CORPORATION
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Construction Status – Escalators to Mezzanine
HUDSON YARDS DEVELOPMENT CORPORATION12
Construction Status – Tunnel (June 2013)
HUDSON YARDS DEVELOPMENT CORPORATION
Project Costs and Financing Structure
Total Cost ($mm)
No. 7 Subway extension:
Construction 2,260
Contingency 107
Acquisition of a portion of ERY TDRs from MTA 200
Parks, Streets and Property Acquisition 433
Total 3,000
Project financing plan operates by capturing the incremental revenues from new developments, made possible by the HY rezonings, to cover debt service on HY Project bonds issued by HYIC
$3.0bn of Hudson Yards Project bonds have been sold, making the project fully funded
$1.0bn of Hudson Yards bonds were sold in October 2011. The bonds were rated “A” by S&P and Fitch, and “A2” by Moody’s
$2.0bn of Hudson Yards bonds were sold in December 2006, with similar ratings
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HUDSON YARDS DEVELOPMENT CORPORATION
Property Tax Equivalency Payments
Hudson Yards IDA PILOT Payments
DIB and ERY TDR Payments
HYIC
• No. 7 Subway Extension
• Parks and Streets
• $200 mm to MTA re: ERY
• HYDC Operating Expenses
Interest Payments by City if HYIC
Revenues Insufficient
Debt Service
Bond Proceeds
Bondholders
The HY Financing Structure
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HUDSON YARDS DEVELOPMENT CORPORATION
COMMERCIAL DEVELOPMENT RESIDENTIAL DEVELOPMENT
INCLUSIONARYHOUSING BONUSDISTRICT IMPROVEMENT
FUND BONUS (DIB)
BASE (AS-OF-RIGHT)
DEVELOPMENT
EASTERN RAILYARDTRANSFER (ERY TDRs)
DIB
BASE (AS-OF-RIGHT)
DEVELOPMENT
A
B
West 36th S
treet
DIB (Pari Passu)
Mid-Block Blvd. &
Park
Increasing Density and Creating Non-Recurring Revenue Sources:
DIB and ERY TDRs
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HUDSON YARDS DEVELOPMENT CORPORATION
ERY TDRs Generating Site
ERY TDRs Receiving Sites
DIB Available
34th Street
Eig
hth
Ave
nu
e
Ten
th A
ven
ue
42nd Street
ERY TDRs
ERY
Increasing Density and Creating Non-Recurring Revenue Sources: ERY TDRs
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HUDSON YARDS DEVELOPMENT CORPORATION
34th St.
42nd St.
8th
Ave.
10th
Ave.
Zone 3
HY UTEP AreaZone 2
Zone 1No Discount*
25% Discount for 15 years,
or the benefit available in Zone 3, whichever is less,
then 4 year phase-out
Illustration of Percentage Discount to Actual Taxes Available for Office Buildings in Hudson Yards UTEP Area
1st 5 million sf 40% Discount,
2nd 5 million sf 25% Discount,
3rd 5 million sf 20% Discount,
4th 5 million sf 15% Discount,
all for 15 years, then 4 year phase-out
* Program provides fixed 3 percent annual payment increase for 15 years
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Incentivizing Development
New office development will receive property tax abatements according to Uniform Tax Exemption Policy adopted by NYC IDA
HUDSON YARDS DEVELOPMENT CORPORATION
Forecasting Future Development
As a result of the 2005/2009 rezonings, Hudson Yards district can now accommodate:
25 msf of new office development
20,000 units of new housing
2 msf of new retail
3 msf of new hotel
Developers have invested approximately $7.0B to build 9.1 msf of new office, residential and hotel development in Hudson Yards since the 2005 rezoning
More than 6,000 apartments, including 1,600 affordable units, and more than 3,200 hotel rooms have been built
Market rate residential rents are reportedly in the mid-$60s to mid-$80s
$90M of DIB has been sold since 2005
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MiMA, 440 West 42nd Street (Related Companies)
Yotel, 570 Tenth Avenue
Silver Towers, 600 West 42nd Street(Silverstein Properties)
HUDSON YARDS DEVELOPMENT CORPORATION
Brookfield’s “Manhattan West”
January 2013 groundbreaking for Brookfield’s “Manhattan West” was held on the Ninth Avenue site (between West 31st and West 33rd Streets)
Mixed-use development will include more than 5.0 msf of office, commercial, and residential uses
$680M platform under construction using bridge technology (see image below)
450 West 33rd Street (pictured lower right) will be retrofitted as part of the project
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HUDSON YARDS DEVELOPMENT CORPORATION
Related/Oxford’s “Hudson Yards”
The Related Companies and Oxford Properties have partnered to develop the 26-acre MTA Rail Yard sites (aka “Hudson Yards”)
Mixed-use development will include more than 13.0 msf of office, hotel, retail, and residential uses and 10+ acres of public open space
Two phases of development Phase I – Eastern Rail Yard: From 10th to 11th Avenue between West 30th and West
33rd Streets Phase II – Western Rail Yard: From 11th to 12th Avenue between West 30th and West
33rd Streets
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HUDSON YARDS DEVELOPMENT CORPORATION
Residential Projects in the 2013 Pipeline
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Address Developer # of Units
605 West 42nd Street Moinian Group 1,194
West 31st Street (between Ninth and 10th Avenues)
Brookfield Office Properties 850
10th Avenue at West 41st Street Extell Development Company 600
509 West 38th Street Iliad Realty 250
West 36th Street (between 10th and 11th Avenues)
Lalezarian Developers 200
West 37th Street (between 10th and 11th Avenues)
Chetrit Group TBD (also includes a hotel)
Total 3,094
HUDSON YARDS DEVELOPMENT CORPORATION
Hudson Yards: 2013/2014
The new 34th Street and 11th Avenue Station will accommodate up to 30,000 peak-hour riders when Hudson Yards is fully developed
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HUDSON YARDS DEVELOPMENT CORPORATION
Hudson Yards: 2013/2014
Hudson Park and Boulevard – Looking north from West 34th Street
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