MTA Chief Signals Delay on Hudson Yards Decision

The chairman of the Metropolitan Transportation Authority is suggesting that a decision on the future developer of the Hudson Yards will be delayed at least until the end of March, and perhaps several more months.

"It will be an aggressive time frame for us to meet," the CEO and executive director of the MTA, Elliot Sander, said in an interview when asked if a decision could be expected by the end of the month.

Over the last few weeks, the five original bidders on the far West Side project — Tishman Speyer, the Related Companies, Extell Development, Brookfield Properties, and a collaboration between the Durst Organization and Vornado Realty Trust — have been whittled to four. Last month, Brookfield withdrew its bid from consideration and said it would focus on another rail yard site between the Hudson Yards and Penn Station. A week later, Tishman Speyer lost its anchor tenant, Morgan Stanley, which could lessen its chances of winning the bid, sources say.

Although Mr. Sander declined to comment on the reason for the selection delay, a number of observers have said it is likely tied to the changing of the guard in Albany. Earlier this week, the co-chairman of the Empire State Development Corporation, Patrick Foye, stepped down following Governor Spitzer's resignation in the wake of a prostitution scandal.

In January, the MTA sent out an addendum to its original request for proposals, seeking a more detailed financial payment plan for the 99-year lease on the property. At the time, the developers voiced their opposition to the move, accusing the MTA of placing too many added financial burdens on them in an uncertain economy.

Mr. Sander said he saw things differently.

"Our perspective is that this transaction involves more than one business cycle and should not be — from a financial perspective — overly influenced by some of the market turmoil that we have seen the last several weeks," he said.

A source helping negotiate on behalf of one of the remaining bidders, who declined to speak for attribution until a decision was made, said the developers' apparent frustration was likely just posturing.

"The bids are going to reflect the value of what people are bidding on, no matter how they play it up to what they MTA is asking for. The fact that they are asking for A, B, and C doesn't affect the underlying value of the asset," the source said.