Developers Related Cos. and Oxford Properties, along with their casino resort partner Wynn Resorts, have abandoned their high-profile plan to build a casino resort on the western half of Hudson Yards, the largest U.S. private development.
Related and Oxford, instead, will pursue a plan that involves building up to 4,000 apartments as part of a mixed-use complex at Western Railyards to finish the Hudson Yards development, the developers said in a statement with City Council Member Erik Bottcher, who had objected to a development plan involving a casino.
The proposal, moving through a land-use-review rezoning process, has been “significantly modified” after talks with Bottcher and the community, the developers said, describing the agreement with the council member as "historic."
Wynn Resorts explained its decision to drop out of the competition for the coveted license in an emailed statement to CoStar News. “The recent rezoning process has made it clear to us that there are uses for our capital more accretive to our shareholders, such as investment in our existing and upcoming developments and stock buy backs, than investing in an area in which we, or any casino operator, will face years of persistent opposition despite our willingness to employ 5,000 New Yorkers,” it said.
The decision came less than a month after Related and Oxford more than doubled the number of housing units they proposed to build to boost the odds for the casino bid.
As developers and their casino operators vie for up to three downstate gaming licenses in and around New York City, the state has said landing community support is key to winning a gaming license. Besides objections from Bottcher, the Hudson Yards West bid has faced opposition from groups including Manhattan Community Board 4 and Friends of the High Line; among their concerns was that the project would block the view and light of the High Line elevated park.
The New York gaming board has said casino application licenses are due June 27, with decisions on the winning bids expected by the end of the year. Contenders have to pay $1 million in application fees to the New York State Gaming Commission, and winners have to pay a $500 million casino licensing fee up front.
Other canceled plans
The withdrawal of Hudson Yards West’s casino bid followed that of Las Vegas Sands, which dropped its bid at Long Island’s Nassau Coliseum site, and Saks Global's abandonment of its casino plan atop Manhattan’s iconic Saks Fifth Avenue flagship store.
The new plan from Related and Oxford also involves expanding the size and layout of the public green space by 1 acre to 6.6 acres and cutting podium heights and podium density that would be built over the railyards. As part of the new housing proposal, the developers said they would increase affordable housing units to a minimum of 400 from 324. If the project gets 485-x tax abatement incentives, a quarter of the planned units can become affordable housing, they said.
If approved, Hudson Yards West, between West 30th and West 33rd streets from 11th to 12th avenues, would be among the largest additions to Manhattan’s housing stock in decades, the developers said. A payment-in-lieu-of-taxes program would leverage incremental property taxes that would allow Hudson Yards West to “overcome financial challenges of the site, including the necessary construction of a $2 billion platform over the existing railyards.”
“The totality of these changes mean that we can move forward with a plan that will create critically needed housing at all income levels,” among other things, Jeff T. Blau, CEO of Related Companies, said in the statement, adding that the proposal is “financially sound.”
The plan without a casino also includes office, retail and potentially hotel space, according to the documents the developers filed with the city as part of the zoning process. A Related spokesperson didn’t immediately respond to a CoStar News request seeking clarification and update. The developers already committed to building a public school.