Why New York State Insists That the Penn Station Area Is ‘Blighted’

The congested, chaotic section of Manhattan near Pennsylvania Station, which teems with tourists, commuters and shoppers, is undeniably drab. Does that make it blighted?

New York State has decreed that it is, and Gov. Kathy Hochul has recently likened the Penn Station area to “a Skid Row neighborhood.” She was defending the controversial plan to allow developers to build 10 towers around the decrepit train station — the busiest transit hub in the nation — in exchange for some of the $7 billion the state needs to renovate it.

If New York State officials deem an urban area to be “blighted,” blocks can be bulldozed and people and businesses can be forced to relocate. And new towers — unbound by limits on size and height as defined by the city’s normal planning rules — can rise.

The state’s authority to make such a determination and move forward with redevelopment is nearly impossible to contest.

Its ability to intervene was meant to ensure that neglected areas do not languish. But critics say that officials have long abused the power to pry private properties away from their owners, and they accuse Ms. Hochul of continuing the practice with the Penn Station redevelopment project.

Over the years, the state has used the blighted designation to redevelop swaths of New York City. The move was used to clear properties in Prospect Heights, Brooklyn, for the Barclays Center; to clean up the banks of the East River to create the Brooklyn Bridge Park; and to condemn a section of Times Square, including adult clubs, as part of a lengthy effort to rebuild and sanitize the district.

More recently, then-Gov. Andrew M. Cuomo employed it to create Moynihan Train Hall in Midtown and argued for its use in the Penn Station project before he resigned in August 2021, with his successor, Ms. Hochul, continuing the redevelopment.

In almost all those cases, state officials have been accused of exaggerating the conditions as a means to override local control and zoning rules. Without the state’s role, developers would have to pursue redevelopment on their own, enduring a lengthy city approval process. With it, the City Council has no say on a project.

Opponents of the Penn Station project, which include a West 30th Street tenants association and the City Club, a civic group, have filed a lawsuit to halt the plan. Community Board 5, which represents the district, said that characterizing the area “as a slum or blight” was offensive and “grossly inaccurate.”

“Blighted is in the eye of the beholder,” said Tom Angotti, professor emeritus of urban policy and planning at Hunter College. “What’s blighted in your eyes could be a perfectly functioning building and neighborhood in mine.”

Blight has been a concern in major U.S. cities since the turn of the 20th century, when the country’s population shifted from rural settings to urban centers. Reformers first tackled blight conditions as threats to public health and safety before viewing them as rationales for economic development.

New York is among a handful of states, including Connecticut, that use the power of eminent domain to seize private property for economic development. In a 2009 case affirming New York’s authority, the state’s Court of Appeals ruled that the legal bar for blight might “have been set too low” but said it would be up to lawmakers to change the definition.

Over the past 15 years, dozens of states have placed limitations on when they can take ownership of private property. But not New York State, which has among the fewest restrictions on its power to rebuild areas in the name of economic development, according to the Institute of Justice, a libertarian policy group that tracks the issue.

To many people, a “blighted” area would be dilapidated, if not beyond repair; the term conjures up images of vacant buildings, overgrown lots and lawlessness. But as defined by the State of New York, the label is both vague and all-encompassing. It can include conditions like traffic congestion and excessive density that would describe much of New York City.

Tom Wright, the president of the Regional Plan Association, a research and advocacy group, supports the plans to overhaul Penn Station but said he avoids using the word “blight” because he considers it loaded and archaic. Yet Mr. Wright said the area would be improved by the investments that have been proposed.

“When I walk around Penn Station, that is an area in need of redevelopment,” Mr. Wright said.

The Penn Station neighborhood changes block by block. There are souvenir shops, a McDonald’s on Seventh Avenue that is one of the city’s oldest, a 1,500-spot parking garage and a 19th-century Roman Catholic church. It is home to Apple’s largest office in New York City.

The station itself, with its cavernous underground space, has long attracted homeless people. Last year, a survey by the Metropolitan Transportation Authority found that the vast majority of homeless people in the entire subway system seek shelter in just eight stations, including Penn Station.

Among the biggest supporters of the project are leaders of the construction industry, like Carlo A. Scissura, president of the New York Building Congress. Mr. Scissura said it would “boost the entire region’s economy, create tens of thousands of new jobs and transform Penn Station and the surrounding community into the modern, vibrant commuter hub it was always destined to be.”

For the Penn Station project, state officials have staked their claims of blight on “substandard and insanitary conditions” and “economic stagnation.” The evidence to support those claims was outlined in a neighborhood study commissioned by Empire State Development, the agency overseeing the project and facing the lawsuit from its opponents, and completed by a civil engineering firm in February 2021.

In the 240-page neighborhood report, the firm explored the exterior and interior conditions of every property in the redevelopment area, assigning ratings for each site. The buildings were found to be older, with many built before 1932, and generating lower rental revenue than their peers in surrounding neighborhoods.

Across the redevelopment area, only one building received the worst rating of “critical condition,” a property with damaged and missing windows, cracked walls and eight unresolved building violations. It is 232 West 31st Street, a four-story service building for Penn Station that is owned by Amtrak.

Richard Emery, a Manhattan lawyer who represents opponents of the redevelopment project, noted that the state’s own assessment found only eight of 61 lots met the definition of blighted. In contrast, the state deemed more than 70 percent of the Atlantic Yards area of Brooklyn to be blighted before it was redeveloped with the Barclays Center, which opened in 2012.

“It’s not even close to blighted by any stretch of the imagination,” Mr. Emery said. “It’s so extreme in this case, I don’t think they can get away with it.”

The governor’s office reaffirmed Ms. Hochul’s commitment to the development, which is expected to be completed by 2044. Empire State Development declined to comment on the lawsuit.

Some properties with faulty conditions or unresolved violations are owned by Vornado Realty Trust, the neighborhood’s largest landowner, which the state has said will develop some of the new towers. Vornado, a public company that is among the city’s largest owners of offices, has accumulated more than a dozen properties in the area over the last 20 years, holding onto them in anticipation of a larger redevelopment.

Of the eight sites that would be redeveloped, Vornado owns four of them and a share of another. The sites could give rise to some of the tallest buildings in the city.

Over the years, state projects aimed at eradicating blight have been criticized for rewarding developers whose properties had seemingly contributed to it. A decade ago, critics of a state project in which Columbia University would expand into Manhattanville pointed out that the university owned a large majority of the sites that were later designated as blighted.

Although the lawsuit over the Penn Station project does not make such a claim, the lawyers noted that Vornado’s chief executive, Steven Roth, once boasted about letting a Manhattan property languish on purpose to spur the government to offer financial assistance. That site on Lexington Avenue later became the headquarters for Bloomberg LP.

Vornado declined to comment about blight in the Penn Station area, citing the lawsuit.

If the Penn Station projects move forward, one of the properties that would have to be demolished is 421 Seventh Avenue, a 15-story office tower owned by the developer Arnold Gumowitz, whose own office is in the building. He has said he does not want to sell.

The neighborhood study said his building was in “fair condition” but had “large amounts of cracking” on exterior walls.

“For the state to call the Penn Station area blighted — which it’s not — harms the ability of those of us who are a part of this community to thrive,” Mr. Gumowitz said in a statement.

The Penn Station project received the first approval in July that it needed from the state’s three-member Public Authorities Control Board. But the board would have to unanimously approve additional parts of the project for it to move forward. One of its members, State Senator LeRoy Comrie, a Democrat, said in an interview that he had concerns about the development and urged Ms. Hochul to redesign it

The rebuilding of Penn Station was not ambitious enough, Mr. Comrie said, and should be remade to allow rail passengers to travel to more destinations without changing trains — riding from Boston to the Hamptons on one train, for example. And he said he was worried that the real estate project, with its dependence on office space when many companies have embraced hybrid work, could fail to generate the needed revenue to pay for the renovation of Penn Station.

“We should spend those once-in-a-lifetime dollars on a 2050-type vision as opposed to a 1970s vision,” Mr. Comrie said. “We need to make sure that whatever happens aboveground is actually something that will help finance the project.”