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New Plan For Penn Station Revamp Sans Vornado Gains Traction

The future of Penn Station and Madison Square Garden have been a priority for New York Gov. Kathy Hochul and her predecessor.

State officials are considering a different direction for the overhaul of Pennsylvania Station, which would involve ditching plans for 10 new office towers to fund the development — and finding a new location for Madison Square Garden — and instead building a revamped station around the arena.

A subsidiary of the Italian firm ASTM Group has presented a proposal now favored by state and local leaders, The New York Times reports. The state had planned a redevelopment of the transit hub that was set to bring 10 mixed-use towers to the blocks around the station, with Vornado as the lead developer.

But Vornado CEO Steven Roth said last month the current climate of high interest rates meant the firm was putting the plans on hold. Roth said on earnings call last month that new construction is “almost impossible” in this lending environment.

Gov. Kathy Hochul said her government was committed to redoing the station, regardless of Vornado’s involvement.

“I’m committed to getting that done,” she said on WNYC’s All Things Considered earlier this month, adding that the plan is “not contingent on what Vornado was planning in the entire neighborhood.”

The ASTM plan wouldn't involve the full demolition or relocation of MSG, but calls for surrounding the arena with a glass podium designed to look the same as the Farley Building across the street, the Times reported.

It also calls for two new train halls, one of which would feature a mix of retail and waiting areas and potentially a homeless outreach center. Another train hall would been enclosed in a 100-foot glass enclosure that would abut Vornado’s office property at 2 Penn Plaza.

This new plan is led by former MTA CEO Patrick Foye and Peter Cipriano, who was a senior infrastructure adviser to Trump administration Transportation Secretary Elaine Chao.

“As we’ve said, we are always open to discussions,” an MSG spokesperson told the Times. “As invested members of our community, we are deeply committed to improving Penn Station and the surrounding area, and we continue to collaborate closely with a wide range of stakeholders to advance this shared goal.”

ASTM Group will not have cost projections until June, but the plan would see the development complete by 2030.

The Vornado plan was originally backed by then-Gov. Andrew Cuomo, and it was long the source of skepticism before Roth threw cold water on it this year. The New York City Independent Budget Office found in a report last year that the plan to fund the project with tax revenue from 18M SF in new development didn't make financial sense.