Billion dollar project derailed

Niki May Young
Monday 12 May 2008

West Side woes- billion dollar development project derailed

Not more than five weeks after New York City’s Metropolitan Transportation Authority (MTA) awarded the development rights to West Side Rail Yards to Tishman Speyer, the deal has collapsed. The deal for the billion-dollar development died on the vine Thursday when Tishman and the MTA reportedly reached an impasse. According to MTA spokesperson Jeremy Soffin, the cause of the impasse was: “Tishman Speyer's attempt to change a central deal term in an effort to postpone the closing on the Eastern Yard until the Western Yard was satisfactorily re-zoned.” He continued, “This demand changed the economics of the proposed deals and the certainty of payments to the MTA. The MTA remains committed to developing these unique and very valuable parcels of land.”

It is unclear where the project will go from here. One option for the MTA is to go back to the other bidders, but those bids were substantially less than Tishman’s $1 billion bid. Tishman is not completely out of the picture yet. The developer’s spokesperson, Robert Lawson, told the New York media: “This is a highly complicated deal and we have been negotiating in good faith with the MTA for several weeks. We share the same goal as the MTA and the City to transform Hudson Yards into a successful and vibrant community. We still hope to be able to complete this deal and reach an agreement that satisfies the needs of everyone.

Sharon McHugh
US Correspondent

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