City could be on the hook for $96M in unexpected costs at Hudson Yards

Costs spring from No. 7 subway extension, park

TRD New York /
Jun.June 15, 2017 02:45 PM

A rendering of Hudson Yards

The city may be on the hook for nearly $100 million in unexpected additional costs related to redeveloping Hudson Yards, according to a new report.

The Independent Budget Office found that an additional $96 million is needed to fund the extension of the No. 7 subway line and the planned four acres of park and open space known as Hudson Park & Boulevard. The construction of the latter is expected to cost an additional $64 million, while the subway extension would require another $32 million, according to the report.

It’s not yet clear how the additional expenses will be funded. The development corporation has already issued the maximum amount of completion bonds ($3 billion) approved by the city, so the City Council would need to sign off on any additional bonds.

Under the Bloomberg administration, the Hudson Yards Infrastructure Corp., a subsidiary of the city’s Economic Development Corporation, issued $2 billion in bonds in 2007 and another $1 billion in 2012 for the subway extension and other infrastructure improvements. Last month, the city refinanced portions of this funding.

Representatives for the EDC didn’t immediately respond to a request for comment.

The city has also granted several tax breaks at Hudson Yards to encourage development. In January, the city approved $177 million in tax breaks to Related Companies and Oxford Properties Group, the companies charged with redeveloping a majority of the 26-acre site. The city also approved a tax break valued at $330 million for 30 Hudson Yards.

Related and Oxford are seeking $380 million in EB-5 funding 35 Hudson Yards and 55 Hudson Yards.

According to the IBO’s report, the city expects to spend $266 million of its own capital funds by 2021 on projects related to the Hudson Yards redevelopment. In 2005, the city expected to only spend $128 million.

(To view new construction projects at Hudson Yards, click here)

Related Articles

(Image by Wolfgang & Hite via Dezeen)

Hudson Yards megadevelopment inspires a new line of sex toys

With a cooling trade war, stocks perform well, including real estate. (Credit: iStock)

Real estate stocks push up this week as U.S.-China trade tensions ease

416 West 25th Street and Maverick Real Estate Partners principal David Aviram (Credit: Google Maps and LinkedIn)

Chelsea landlord claims “predatory” lender is charging a crippling interest rate as punishment after losing foreclosure case

The total market value of all properties in New York City was at about $1.4 trillion (Credit: iStock)

Market value of NYC real estate went up at slowest rate in years

Donald Trump with Rep. Emanuel Cleaver II, Rep. Ron Kind and Sen. Cory Booker (Credit: Getty Images, iStock)

Trump’s Opportunity Zone program is under investigation

Related Chairman Stephen Ross (Credit: Getty Images, Wikipedia)

Related drops 700-foot-long “wall” from Hudson Yards plan

Shaun Osher, CORE CEO (Credit: Getty Images and iStock)

CORE becomes latest NY resi brokerage to expand into South Florida

From left: 172 Madison Avenue, 100 East 53rd Street, Woolworth Tower, 53 West 53rd Street, 615 10th Avenue

Loan wolves: Bankers are stalking developers as debts come due