Hudson Yards Is Costing Taxpayers Over $100 Million More Than Expected

Posted On Wed, June 1, 2016 By

Posted On Wed, June 1, 2016 By In Architecture, Construction Update, Major Developments, Midtown West, New Developments, Urban Design

The opening of the first Hudson Yards tower dominated headlines Tuesday, but with this milestone also came a resurgence of criticism. As Crain’s reports, the Independent Budget Office has released a new study (pdf) highlighting that, to date, the city has spent nearly $359 million paying interest on $3 billion in bonds that were taken out to pay for infrastructure around Hudson Yards, including the expansion of the 7 train. The city had originally anticipated spending between just $7.4 and $205 million from start through 2016.

10HudsonYards

The slow-moving nature of the development is the reason the city finds itself overextended; the 52-story building opened Tuesday is just the first of 16 expected for the massive site. Initially when structuring financing for the project, the city opted to take out bonds over funding the project through its capital program. It was anticipated that interest on the debt could be paid with money earned through property taxes and other fees, such as the sale of development rights. Unfortunately, the economic turndown of 2008-2009 led to numerous delays.

As Crain’s highlights, “A report drafted for the city a decade ago by the real estate services firm Cushman & Wakefield projected the city would reap between $986.6 million and $1.3 billion from those fees. Instead it collected only $755.4 million.”

The city responded to IBO’s report saying that the agency failed to consider all revenue streams. Developer Related Companies also added in a press release that the investment in infrastructure has brought with it billions of dollars in private money from various developers and has already created thousands of jobs. Related expects Hudson Yards to contribute $18.9 billion to the city’s GDP when open. The development will host 17 million square feet of commercial and residential space, supporting more than 125,000 workers and residents.

It is forseen that another $116.6 million in taxpayer money will be spent through 2020, but beyond that date, no budget has been forecasted. IBO did, however, include that the city will save $121.1 million in interest payments in 2018 and 2019 as more buildings break ground and development rights can be sold. Hudson Yards is expected to wrap by 2025.

[Via Crain’s]

RELATED:

Tags : , ,

Neighborhoods : hudson yards,Midtown West

MOST RECENT ARTICLES

  • $12,000/month to rent this triplex townhouse beauty in Boerum Hill

    $12,000/month to rent this triplex townhouse beauty in Boerum Hill

    Renters can enjoy Brooklyn townhouse living in all its glory here at 306 State Street, a Boerum Hill property now ...
  • Millennial home buyers prefer DIY over going into debt over renovations

    Millennial home buyers prefer DIY over going into debt over renovations

    Millennial homeowners—yes, they do exist—are a careful lot, according to Better Homes & Gardens’ ninth annual survey of trends in ...
  • Have your apartment photographed by 6sqft!

    Have your apartment photographed by 6sqft!

    Did you spend months decorating your apartment? Is your home historic or quirky? If you live in a unique or ...
  • Express N train tunnel will close for a year in Brooklyn; Map shows the CO2 savings of CitiBike

    Express N train tunnel will close for a year in Brooklyn; Map shows the CO2 savings of CitiBike

    The express N train tunnel between the 36th and 59th street stations in Brooklyn will close for a year for repairs ...
  • The first presidential inauguration was held in New York City in 1789

    The first presidential inauguration was held in New York City in 1789

    As Washington, D.C. attempts to rein in the crowds on this Inauguration Day, New Yorkers can be thankful someone else ...
  • FREE RENT: A roundup of NYC’s latest rental concessions

    FREE RENT: A roundup of NYC’s latest rental concessions

    Midtown Rental Skyscraper ‘Tower 31‘ Offering One Month Free or One Month OP on Select Leases [link] Leasing Launches at ...
  • VIDEO: Watch the MTA clean subway tracks with their new Mobile Vacs

    VIDEO: Watch the MTA clean subway tracks with their new Mobile Vacs

    This past May the MTA recorded 50,436 subway delays, 697 of which were caused by track fires that could have ...
  • The Urban Lens: Inside ‘Little Odessa,’ Brighton Beach’s quaint beachfront Russian community

    The Urban Lens: Inside ‘Little Odessa,’ Brighton Beach’s quaint beachfront Russian community

    6sqft’s ongoing series The Urban Lens invites photographers to share work exploring a theme or a place within New York City. ...
  • Whole Foods will open a lower-priced ‘365’ store in Downtown Brooklyn

    Whole Foods will open a lower-priced ‘365’ store in Downtown Brooklyn

    Downtown Brooklyn is quickly becoming one of NYC’s most desirable commercial hubs. On top of hosting a lengthy roster of big ...
  • MTA backs plan to raise subway and bus fare to $3 come March

    MTA backs plan to raise subway and bus fare to $3 come March

    At a board meeting over the summer, the MTA began discussions about increasing subway and bus fare to $3 by ...
  • ‘Desperately Seeking Susan’ screenwriter lists Chelsea townhouse with a private yoga studio for $7.1M

    ‘Desperately Seeking Susan’ screenwriter lists Chelsea townhouse with a private yoga studio for $7.1M

    Built in the 1830s when this quiet, tree-lined residential block was home to well-to-do families, the four-story, 3,600 square-foot Greek Revival townhouse at ...
  • Pop singer Santigold lists her ornate Bed-Stuy brownstone for $1.95 million

    Pop singer Santigold lists her ornate Bed-Stuy brownstone for $1.95 million

    Singer and songwriter Santi “Santigold” White—best known for her singles “Creator” and “LES Artistes,” and more recently her video “Can’t Get ...

SIGN UP FOR OUR NEWSLETTERS

Thank you, your sign-up request was successful!
This email address is already subscribed, thank you!
Please provide a valid email address.
Please complete the CAPTCHA.
Oops. Something went wrong. Please try again later.