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The Metropolitan Transportation Authority plans to purchase $ 35 million for the Grand Central Terminal and hundreds of kilometers of track for the Metro-North Railway.
Many of the 750,000 people who use Midtown Manhattan's historic terminal every day of the week could assume that it belongs to the MTA, the vast agency that runs Metro-North, the Long Island Rail Road, and the subway systems. bus from the city. But the MTA rents the terminal, as well as the Harlem and Hudson lines from Metro-North.
The installation is a remnant of the days when the terminal and tracks belonged to the now defunct Pennsylvania Railroad, which went bankrupt almost 50 years ago.
At present, the MTA pays just over $ 2 million a year to lease the terminal and runways of current owners, Midtown Tracking Ventures LLC investment group. Under the terms of the lease, the MTA has a two-year window from April 2017 to October 2019 to purchase the terminal and runways.
At a meeting of the MTA Finance Committee, the commissioners voted in favor of the purchase. The decision will be submitted to the full board Thursday, where it should be approved.
Carl Weisbrod, MTA board member, said after the meeting that the deal was good for the MTA. "Financially, that makes sense; operationally, it makes sense, "he said. "I think everyone recognizes that the MTA has to do that."
Exterior clock view of Grand Central Terminal in New York.
Photo:
EMMANUEL DUNAND / Agence France-Presse / Getty Image
The MTA said the purchase of the terminal and lanes would provide many benefits to the transportation authorities, including allowing Metro-North to better control its operations and generate additional revenue through development opportunities. If the MTA were to own the Harlem and Hudson lines, it would be able to take advantage of the residential and commercial developments built near the tracks.
This will also give the MTA more control over the terminal in time for the arrival of the LIRR, which is expected to start operating from Grand Central in about four years as a result of an expensive and lengthy expansion of the railway.
As part of this agreement, the MTA will take over the terminal as well as the Hudson line from Grand Central to Poughkeepsie and the Harlem line to Dover Plains. The investment group will retain control of the remaining air rights over the terminal.
"It was obvious, from a financial point of view," Janno Lieber, director of MTA development, said in a statement.
Mr. Lieber said that at current interest rates, it is cheaper to buy the terminal than to continue paying rent until the end of the lease, which runs out. until 2274.
Shortly after the lease was signed in 1994, the MTA embarked on a major renovation project in Grand Central. In the space of a few years, the MTA spent $ 200 million on developing the cavernous halls and corridors of the terminal and expanding its shops and restaurants.
Midtown Trackage purchased the terminal and air rights for nearly $ 80 million in 2006. In 2016, a partnership led by TF Cornerstone and MSD Partners, LP purchased Midtown Trackage for an undisclosed amount. Michael Dell's MSD Capital is a subsidiary of MSD Partners. A representative of Midtown Trackage declined to comment
Write to Paul Berger at [email protected]
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