The next phase of the Hudson Yards redevelopment project in New York could come with increasing costs to the city, according to the Independent Budget Office watchdog agency.
Next week, approvals are likely for an 80-story office tower and 1.1 million square foot shopping mall at the project site on Manhattan's far West Side. The tower and mall together are in store for a property tax break worth an estimated $328 million over 20 years.
The New York City Industrial Development Agency has scheduled a public hearing on the proposed tax breaks.
"Providing a property tax abatement for the mall means the city will need to pump more money than previously expected into Hudson Yards to meet the development's debt service obligations," spokesman Doug Turetsky wrote on the IBO's website. "It also undercuts a shift in city policy away from showering retail projects with tax breaks."
Since the Hudson Yards plan first received approval in 2005, references to tax abatements concentrated on the need to spur office development.
"Now it appears that in addition to the 20-year tax breaks for the North Tower, the IDA is also set to award a 20-year tax break to the 1.1 million square foot shopping mall to be constructed with an entrance into the new tower," Turetsky wrote.
