Tag Archives: Penn Station

Renovating Penn Station as an institution, not a building

NYP Cuomo

Beware nostalgia for the old Penn Station. While the railroad station’s current iteration neither functions well nor provides an inspiring space, addressing these problems requires addressing the underlying issues of railroad governance, finance, and operations.

Writing in the New York Times, David Dunlap aims to demolish the myth of Penn Station’s demise as solely an act of civic vandalism. Penn Station’s decline was a symptom of major shifts in transportation finance, travel patterns, and urban development. Railroads were accustomed to their monopoly position and regulated accordingly.

With the rise of direct competitors for both intercity and commuter traffic from airlines and cars (both subsidized by the government), change was inevitable:

In “The Late, Great Pennsylvania Station,” Lorraine B. Diehl said the death knell first sounded in 1944, when President Franklin D. Roosevelt signed into law a bill to provide $1.5 billion in federal financing for new highways, including an interstate system.

It sounded again in 1947, when the Pennsy reported an operating loss for the first time in its long existence. One month later, in March, a United Air Lines DC-6 reached La Guardia Airport only 6 hours 47 minutes after it left Los Angeles.

It sounded again in 1949, when the railroads’ share of intercity passenger traffic fell below 50 percent. And again in 1956, when construction of the interstates began in earnest. And again in 1958, when National Airlines inaugurated domestic jet travel with a run between New York and Miami that took just 2 hours 15 minutes.

Intercity travel and freight were the most profitable business lines for railroads. Commuter trains provided some feed for longer distance trains, but were an otherwise marginal business. In reality, the business was in decline well before 1944; Ridership for transit of all forms declined during the Great Depression (along with the rapid expansion of suburbs and proliferation of the automobile), only propped up by travel restrictions during WWII.

Penn Station’s edifice was torn down because the economic model of American railroads, predicated on their monopoly on metropolitan mobility, collapsed. Looking to monetize their assets, developing their lucrative real estate seemed obvious. For Penn Central, it wasn’t enough to save the company. Still, the loss of the building draws most of our attention.

Even today, we tend to focus mostly on Penn Station as a place, rather than on the underlying tunnels, tracks, and organizations that operate them. Last week, New York Governor Andrew Cuomo unveiled his reboot of the longstanding plans (with a throwback to Gov. Pataki and Pres. Bill Clinton) to redevelop Penn Station, complete with a rebranding.

The full presentation slide deck includes lots of flashy renderings of what’s possible, building off of the same basic concepts as before: relocating Amtrak functions to a new facility within the Farley Post Office building; removal of Madison Square Garden’s theater and a complete redevelopment of Penn Station’s concourses below.

There’s a lot to be said in marshaling the political will to get something done. Cuomo’s presentation doesn’t shy away from that ambition. But ambition alone isn’t enough. Given the challenges in executing complex projects, it’s not surprising to see figures like Robert Moses viewed favorably. But are you executing the right projects?

Slide #6 from Gov. Cuomo's presentation, complete with Robert Moses.

Slide #6 from Gov. Cuomo’s presentation, complete with Robert Moses.

Not only does the focus on the building itself miss the real capacity challenges for Penn Station’s infrastructure, it also elides over the very real challenges for operations and governance. Adrian Untermyer reminds us of the key governance challenges to success for any plan:

In 1970, one railroad controlled the transportation hub. After it went bankrupt, New York State took over trains to Long Island, New Jersey took over trains to the Garden State, and the Feds took on the rest…

Even with a reinvented station complex overhead, the Long Island Rail Road, New Jersey Transit, and Amtrak will still share the mostly same tracks, cramped platforms, and underwater tunnels. It’s unlikely that decades of dysfunction will disappear after the ribbons are cut.

Finding effective governance solutions for both the physical station as well as the underlying railroads that use it is a much bigger challenge. During the monopoly era, before the creation of either the MTA or Amtrak out of the remnants of Penn Central, that kind of vertical integration clarified things. Current governance is muddled.

Lack of integration and coordination among various stakeholders isn’t a new problem. When New Jersey Governor Chris Christie killed the ARC project, some advocates celebrated the demise of a flawed project with the hope for a better one. ARC’s primary flaws stemmed from an inability for the key stakeholders to effectively coordinate investments. Instead of one railroad forcing coordination, Penn Station was a battle between three entities (Amtrak, NJ Transit, and NY’s MTA – each with different priorities and different leadership).

The unwillingness to share turf isn’t just a challenge for Penn Station, coordinating between two states and Amtrak; but even within the MTA. East Side Access, connecting the Long Island Railroad to Grand Central Terminal is an extraordinarily expensive project, opting for a deep cavern terminal station under Manhattan instead of a potentially cheaper and more useful option that would’ve required better coordination and integration between the MTA’s own commuter railroads. Instead of tackling this issues, the MTA opted for the more expensive solution.

Integration isn’t easy. The MTA’s split personality for regional rail dates back to the differences between the PRR and NY Central railroads. The merged Penn Central couldn’t integrate; it’s not a surprise integration hasn’t happened without some larger outside incentive to do so. The past decade of airline industry consolidation in the US shows how hard this can be, even with incentives.

The real challenge isn’t in finding the right design for a new Penn Station, but in reforming the institutions that operate and govern our transit systems.

The costs of moving Madison Square Garden from atop Penn Station

CC image from wallyg.

CC image from wallyg.

The New York City Council recently voted to approve Madison Square Garden’s operating permit for a period of just ten years, with the goal of expediting the arena’s replacement and thereby easing the potential renovation of the city’s main inter-city rail station. Given that operating permits are frequently handed out indefinitely, and given the emerging consensus of the city’s elites that the station needs to be replaced, it’s not surprising to see this characterized by some as an eviction notice.

MSG, unsurprisingly, is pushing back. They argue the arena cannot “be forced to move” through the permit process, as they own the arena and the air rights it occupies outright. The government can certainly force MSG (with proper compensation) to move through eminent domain, though the cost of buying MSG out could be prohibitive, and Mayor Bloomberg has ruled out using eminent domain to do so.

Regardless of the method, moving MSG will require a great deal of money. Taking the property would be plenty expensive; luring MSG to move with a new arena would be similarly pricey. Unlike the previous plans for a new MSG as a part of a Penn Station redevelopment plan, the arena’s operators are finishing a large renovation, essentially a complete re-building of the interior of the venue. With the renovation complete, the promise of a modern arena is less lucrative – particularly when a re-located arena would likely require a less-valuable location.

Proponents of the short extension of the operating permit assert that ten years is enough for MSG to amortize the investment of their renovation. When considering the value of the property alone, that claim is dubious:

Further, under these projections, if MSG were forced to move in 15 years, it would have earned back only $375 million. To recoup its entire renovation cost would take 40 years—which is about equal to the useful lifespan of the rehabbed arena. The building had undergone only minor updates since it opened in 1968.

This analysis, however, is the most conservative way of looking at MSG and isn’t at all the way the business community has seen the Garden since Madison Square Garden Co. was spun off from Cablevision three years ago.

To the Wall Street crowd, MSG is not merely an arena, but a fast-growing media company whose crown jewel is the MSG Networks, which broadcast games for the teams that call the Garden home, plus the New York Islanders, New Jersey Devils and Buffalo Sabres. Operating margins in MSG’s cable business are 68%, based on data from research firm SNL Kagan. The robust revenue stream explains why the company has been able to renovate its signature arena without taking on debt.

For the purposes of valuing a piece of real estate to be taken for public use, considering the value of the entire media business would not make sense. Either way, even if the costs of the renovation are fully amortized, MSG would still be owed just compensation for its property.

 

The high costs of relocating MSG against their will make the outcome unlikely. Even with MSG as a willing partner in a relocation, completing a deal would be complicated and expensive. Realistically, the likely outcome will involve station improvents that fall short of demolishing the arena. These can address some of the staiton’s design flaws, rather than mere aesthetic concerns.

The future of Penn Station, part II: additional resources, renderings, and video of the architectural presentations

Penn Station platforms. CC image from Harvey Yau.

More links in relation to yesterday’s post on the future of Penn Station in New York:

In the videos from MAS, particularly in the panel discussion segment of the event moderated by Michael Kimmelman, it is heartening to hear many of the issues I raised in yesterday’s post (written without the aid of hearing the presentations) acknowledged, if not satisfactorily resolved. The SHoP team in particular at least addressed the more practical concerns of cost, safety, and infrastructure. Reactions amongst transit advocates were skeptical, but open.

Unfortunately for SHoP (and for the credibility of the entire process as something more substantial than a hypothetical design exercise), these pragmatic and practical realities were dismissed as problems for policy wonks to solve, implying they are beneath the work of the designers – all while joking that the one team at least acknowledging these realities was not a ‘designer.’

The future of New York’s Penn Station

Phase 1 of Moynihan Station. Image from Moynihan Station Development Corporation

Phase 1 of Moynihan Station. Image from Moynihan Station Development Corporation

Today, New York’s Municipal Arts Society revealed the results of their recent design challenge to re-envision New York’s claustrophobic Penn Station. The reveal of the concepts comes on the heels of a vote by the city’s Planning Commission to extend the operating permit for the station’s upstairs neighbor, Madison Square Garden, for another 15 years. The fate of the arena and the station are inexorably linked, but the discussion around re-envisioning the station dances around the real concerns of on-site interests and avoids the question of more pragmatic improvements to the underlying infrastructure.

Penn Station is easy to diss. It’s certainly not a grand space, nor a particularly functional one. Michael Kimmelman, architecture critic for the New York Times makes a habit of denigrating the station regularly. Given the regular beatings in the press, it’s hard not to feel sorry for the place. The challenges to improving the space are large and complex (and that’s a big reason why they haven’t been tackled yet).

Several issues pop up in my mind:

Transportation infrastructure: Penn Station has a capacity issue; the two big components are train capacity and passenger capacity. In terms of train capacity, the solution involves new tunnels under the Hudson in some shape or form.

For passengers, the solution is only partly about the ‘station’ as we commonly conceive it, the historic edifice preservationists mourn. That Penn is long gone; but the operational guts of the station never left. Penn Station today, from the concourses down, is essentially the same as it was on opening day. Improving passenger capacity could involve a number of improvements, from the relatively modest expansion of platform access points through Moynihan Station (a project that only addresses a minority of Penn Station’s passengers and did not have the support of previous Amtrak leadership) to more radical changes such as widening platforms at the expense of several platform tracks.

In DC, the recently revealed plan to re-make the back-end of Union Station involves a complete re-configuration and re-build of the entire rail yard in order to widen platforms prior to the construction of air rights development over the tracks. The lesson there is to get your platform arrangement right before you start fixing columns in place (the concept involves the demolition of the existing parking garage over the tracks because the column placement is not ideal for Amtrak’s goals). At Penn Station, however, a lot of those columns are fixed. Even if you demolish MSG above, you’re not going to re-arrange every bit of the original infrastructure. The path dependence of many of those column locations is just too great.

Aesthetic improvements vs. functional improvements: From a great deal of the media critiques of Penn Station, you wouldn’t get a hint of the transportation problems listed above. Instead, the biggest objection is aesthetic. Across town, the magnificent Grand Central Terminal is celebrating its centennial, and the comparison is too juicy to ignore for Here and Now on WBUR.

Kimmelman makes the social case for great design and emphasizing the equity and democratic power that well-designed public space can have. However, design is not destiny. Even while Here and Now gushes over the greatness of Grand Central, they gloss over the fact that it, too faced neglect, deferred maintenance, and the threat of demolition. Kimmelman seemingly glosses over that erroneous causality.

Beware PATH: Kimmelman likewise criticizes Calatrava’s World Trade Center PATH hub as an “architectural foll[y]”, now excessively over budget. At the same time, it’s hard to see the difference between the trajectory of both projects (at least, as envisioned in this design challenge) – both involve avant garde re-designs with little to say about the actual transportation infrastructure. Steven Smith’s accounting of the spiraling PATH project could be a prescient description for Penn Station:

The architecture critics were smitten. The design, The New York Times’s architecture critic Herbert Muschamp wrote, “should satisfy those who believe that buildings planned for ground zero must aspire to a spiritual dimension,” and he hoped that New Yorkers would detect the “metaphysical element” in Mr. Calatrava’s work. His design was supposed to spur development throughout the neighborhood and lead lower Manhattan, still reeling from the attacks, out of its malaise. To the extent that the critics were worried, it was about how it would fit in with the architectural context of the site, not its cost.

Mr. Calatrava would eventually become to be remembered with regret among those in his hometown of Valencia, where his City of Arts and Sciences ended up costing more than three times its initial $400 million budget. But at the time, Mr. Calatrava could do no wrong.

In New York, his starting point was far higher than it had been in Valencia. The Federal Transit Administration pledged $1.9 billion [ed. – now officially at $3.74 billion] for the project early on, and the Port Authority would throw in another few hundred million—a number that would climb much higher.

The lesson from ground zero is that projects like this are exceedingly complex. As Smith’s article shows, the PATH project involves complicated jurisdictional issues and a tremendous number of infrastructure challenges; the hub (with deep pockets backing the project) ended up absorbing most of those common costs.

Madison Square Garden: Penn Station has every bit of the complexity that the PATH hub does, and no element shows this more than Madison Square Garden.

All of the submissions to the Municipal Arts Society’s design challenge assume the re-location of the arena, and apparently did so without talking to the owners of MSG:

A spokesman from the Madison Square Garden Company replied, in part:

“It’s curious to see that there are so many ideas on how to tear down a privately owned building that is a thriving New York icon, supports thousands of jobs and is currently completing a $1 billion transformation. These pie-in-the-sky drawings completely ignore the fact that no viable plans or funding to rebuild Penn Station and relocate MSG actually exist. Not that long ago, MSG spent millions of dollars and three years exploring a move to the Farley building as part of the new vision for Moynihan Station. That plan collapsed for a number of reasons that did not involve MSG, but did involve many of the same people now pressuring MSG to move, including The Municipal Art Society, which created enormous obstacles to achieving the relocation.”

Indeed, MSG was once a willing partner in moving from their current site in exchange for a new arena. As the MSG spokesman indicates, the arena company decided to stay and renovate their current arena due to the slow pace of the complicated deal. The city has some leverage with the operating permit’s expiration date, but otherwise the air rights the arena occupies are privately owned, and the projected cost to buy them out in 2008 was close to $2 billion.

Now that MSG has invested an additional billion dollars into their renovation, not only has the cost of a buyout increased, but those advocating for moving the arena missed the most obvious window to strike a deal. Prior to the renovation, MSG’s aging facilities aligned interests. Now, MSG has little incentive to move, particularly when some of the proposed sites range the original short hop across 8th Avenue in the Farley Building Annex to the distant to Javits Center site along the Hudson (and far from the centrality, connectivity, and value of Penn Station).

The designs miss the art of the deal and ignore the reality that MSG will be, by necessity, a partner in any changes to the site. Ignoring this reality seems to only set the stage for disappointment in implementation. Matt Chaban in Crain’s writes:

The many—architects and urban designers—welcomed the latest push to undo the destruction of Penn, but planners and real estate bosses expressed grave reservations over the plans, which were drawn up at the behest of the Municipal Art Society.

“I don’t know how you do this without telling the people sitting on top of the station what you’re doing,” said Steven Spinola, president of the Real Estate Board, referring to Madison Square Garden.

Incremental improvements: Even without these visions, incremental improvements are possible. While the full scope of Moynihan Station might be ill-advised, the more limited phase 1, consisting essentially of an additional exit concourse providing additional platform access, is a reasonable investment. Additional investments across 8th Avenue could also clear out the maze of back-office and railroad support functions contained within the existing Penn Station facility (things like baggage handling, employee break rooms, a commissary for long distance trains, etc).

This diagram from New York State shows both the phase 1 concourse as well as the mess of rooms and corridors in the existing station. Clearing out those support functions from Penn Station allows for re-allocation of that space for additional passenger facilities and more coherent circulation.

To improve the feeling of the concourses, add an element of spaciousness, and potentially some natural light, there are options without removing the arena. As this section of MSG shows (see also this old cut-away from Popular Science), the arena floor is located on the 5th floor of the structure. The primary use of the lower floors is for MSG’s 5000 seat Theater/Forum. Relocating just the theater, combined with the removal of support functions from the lower levels, would provide a great deal of space to work with to create a more inviting passenger space.

This ‘plan B’ isn’t a new idea. Vornado Realty owns a great deal in and around the Penn Station complex and has a vested interest in improving on the station. Vornado’s CEO Steve Roth suggested as much in 2008 (The more incremental, pragmatic idea even had support from Senator Chuck Schumer):

Despite a push by Vornado and co-developer Related Companies to keep the larger-scale project alive via government support, Mr. Roth indicated he considers that scenario unlikely.

“[We] basically feel that something good is going to happen,” he said. “Either that the governments are going to get their acts together, which they probably will not, or … we have with Madison Square Garden a Plan B, which is they stay where they are, we take out the theater, we—underneath the seating bowl of the arena—put a new grand entrance to Eighth Avenue and a new grand entrance to the station on Seventh Avenue, and what that will do is create a grand train station. Not quite as grand as moving it, but pretty nice. Actually, spectacularly nice.”

Sticker shock: There’s also the matter of cost. SHoP architects estimated their proposal at a mere $9.48 billion:

All the architects insisted their plans were workable, and Vishaan Chakrabarti, a partner at SHoP, even presented a plan using air rights sales and payments-in-lieu-of-taxes to cover the costs of the project, which he pegged at $9.48 billion. “And that’s with a factor of 30% cost overruns,” he said, as though it were a selling point.

Steve Roth emphasized that the value to the private development in the area can be realized with a less expensive station:

Mr. Roth said that the “Plan B” would add just as much value to Vornado’s property as if the original plan went forward.

“Our company’s principal interest in what happens with this Moynihan, Madison Square Garden, et cetera deal is to improve the value and increase the value of our adjacent eight million feet, which we believe we can do equally as well with Plan A or Plan B,” he said.

In that case, perhaps those air rights sales and PILOTs could be directed towards the other infrastructure costs facing the station.

A path forward? Combine new station entrances using that freed space, new concourses with space freed from relocated support functions, incremental improvements at the platform level, operational changes to the operating plans for the railroad tenants at the station, and investments in new rail tunnels under the Hudson – and now we’re talking about a realistic path forward.

The Planning Commission’s new, 15-year operating permit for MSG is a step in that direction, both in terms of identifying realistic improvements as well as syncing the timeframe for the larger discussions about the site. As Matt Chaban notes, the only realistic outcome of the MAS’s re-visioning process is “the kickoff of a renewed debate about the future of the West Side.” And, based on other examples, a decade-and-a-half timeframe would seem to be about right.