ESDC Eyes Farley Post Office Buy in March

The state economic development agency is paving the way to get a hold of the Farley Post Office as soon as next month, a crucial part of the Spitzer administration’s new strategy for building a new Moynihan Station and revamping Pennsylvania Station.

Shortly after coming into office in January, Pat Foye, the new downstate chairman of the Empire State Development Corporation, extended the option to buy Farley, but just until the end of March–an optimistic target, it seemed at the time, for wrapping up a huge real-estate deal that would have involved moving Madison Square Garden a block west, to the back end of Farley, opening up Penn Station to the sky, and erecting huge office towers around its edges on the Eighth Avenue superblock where the Garden now sits.

But it is increasingly clear that Mr. Foye will not wait until that superdeal gets worked out before buying the post office. And having control of some of the property involved would put the state in a better position to negotiate with the private developers who own Penn Station’s air rights over who will pay how much to redo the station.

At a meeting on Wednesday afternoon, the ESDC board agreed to seek a bridge loan or an advance from the developers that would give the agency the few million dollars it would need to close the post-office deal next month. After the meeting, Robin Stout, the president of the Moynihan Station Development Corporation, a subsidiary of ESDC, told reporters that the agency could purchase the post office before wrapping up the larger negotiations. Neither he nor Mr. Foye would say, however, when that would happen.

“A closing date has not been scheduled but we are committed to moving forward as quickly as we can,” Mr. Foye said.

A public hearing on the loan comes March 12. The state Public Authorities Control Board could then approve the general project plan–the same one, it turns out, as was rejected last October–before the end of the month, when the option expires.

Will Assembly Speaker Sheldon Silver veto it this time around?

- Matthew Schuerman