West Side story: New York’s Hudson Yards scheme

“We have around five million workers living within a 40-minute commute of this new neighbourhood,” says Jay Cross, looking down on the western side of the 28-acre Hudson Yards development, the sun glinting off the river beyond and the hazy outline of New Jersey just visible in the distance. “Nowhere else in Manhattan can claim that.”   Not just the biggest development in New York, this $20bn, 16-structure project is the biggest of its kind in the US. And as president of Related Hudson Yards, it is Cross’s job to make sure it runs smoothly. Over a decade on since Related was selected to develop the scheme, he is under no illusions as to how tough that job is. “It’s like herding cats,” he says. “Each building here has a different development manager, its own construction group, a separate leasing and marketing team. When you have a situation where there are a number of different investors and lenders on a site where there is a massive amount of shared expenses to cover – including the public space, the connectivity and the infrastructure – a big part of what I do comes down to adjudication.” But, he says, it’s worth it. This is a site regenerating an area of Manhattan that, 10 years ago, was considered an industrial no man’s land. Hudson Yards is one of the first major attempts to create new stock in the city since the 1990s – and it is paying off. Occupiers including Coach, L’Oreal, Sidewalk Labs and WarnerMedia have flocked to be part of the Hudson Yards story. Where the brands go, the residents follow – but it is where they are following from that tells the real story. [caption id="attachment_966929" align="alignnone" width="847"] Jay Cross[/caption] “We have heard tales of people having dinner on the Upper West Side saying ‘if [luxury department store] Neiman Marcus is coming to New York and is moving into Hudson Yards, we need to live down there’.” But does a $5m apartment in a formerly run-down part of the city really have what it takes to draw the Upper West Siders to an entirely new district? On an aerial tour of the site from the 30th floor of 10 Hudson Yards, Cross talks more about attracting those residents while bracing for a slowdown, reveals how he goes about herding the aforementioned cats and discusses how his previous roles – including being president of the New York Jets – have stood him in good stead for the mammoth task now at hand. The ‘arena guy’ years For years, Cross was known as “the sports guy” parachuted in to help basketball (and later American football) teams who needed stadiums. Originally a developer in his native Canada, when the savings and loan crisis hit he was forced to rethink his career. “When that crisis really took hold, in the 1990s, I figured I would never build another office again in my lifetime,” he says. “They were all just vacant and I was wondering what to do next. I was recruited by The Raptors, a new NBA team in Toronto, to build an arena for them. “I did that and was then recruited by Miami Heat to do the same thing. But I said to them: ‘Look, I don’t just want to be the arena guy going from team to team, building stadiums.’ And they said ‘OK, that’s fine because we’ve got all kinds of other problems you can fix’.” This is how Cross ended up on the path to the NFL presidency, starting at the NBA teams and running the business operations while overseeing the creation or development of new stadiums in the background. “I was always of interest to sports teams that needed to build a new facility because of my background as a developer,” he says. “So I drifted into the sports world, but I never lost my basic skills set.” [caption id="attachment_966930" align="alignnone" width="847"] Hudson Yards living room[/caption] He joined the New York Jets, where his role as president saw him become a key player in the city’s bid to host the 2012 Olympics. “Maybe we were the real winners in the end,” he laughs. “A large part of what is going on here at Hudson Yards was predicated by that bid and we got everything done – but we didn’t have to host the games.” They didn’t. But, as Cross points out, the bid drove the masterplan for Hudson Yards as it was set to be the site for the West Side Stadium, which would have been the Olympic arena and a new home for the Jets if New York had been successful and won the games. The bid also fuelled major infrastructure improvements, including the extension of the number 7 subway line, which now serves the Hudson Yards neighbourhood. The Olympic back story meant that when Cross joined Related in 2008 to head the Hudson Yards development, he could hit the ground running – not least because he knew had the support of the government and the people. “For years this part of the city had been seen as a blight on the surrounding neighbourhoods,” he says. “It was a big problem area, with the open railroad tracks and no infrastructure. What we had planned was set to solve a lot of problems and the community wanted us to get going.” Riding out recessions And get going they did – although not without facing a few hurdles. “We were selected to develop in June 2008, and in the fall of 2008 the whole world fell apart,” says Cross. “But when you take on projects like this you know you are going to go through a recession or two. So it actually worked pretty well for us as we spent the whole of 2009 working out zoning. By the time we were ready to start construction, the economy was back on the up and there was a rising tide lifting all boats.” Cross says the plan to use different architects was decided at the start of the process to create a neighbourhood feel. [caption id="attachment_966926" align="alignnone" width="847"] The Vessel at Hudson Yards[/caption] “We describe this as a new New York,” he says. “Or a New York within a New York would be another way of putting it. And to do that we knew we had to avoid the idea of one hand crafting all.” With Kohn Peterson Fox taking on the masterplanning and SOM, Thomas Heatherwick and Diller Scofidio + Renfro working on different parts of the scheme, Cross is confident Related has achieved the neighbourhood goal. And it is this, he says, that caught the occupiers’ attention in the first instance. Bringing in the big guns “We very deliberately started with commercial tenants to get critical mass,” he says. “We signed Coach originally and then L’Oreal. The next big one was WarnerMedia. We have a building set to open in 2023 that is anchored by Blackrock, we have a 200-key Equinox-branded hotel, an Equinox club and SoulCycle. We will populate the retail with a lot of restaurants (20-plus) and suddenly you have a 24/7 neighbourhood. And that’s not like anything else in New York. “It is this that all reflects what the new workforce wants. We can say to the CFOs, ‘you should come and move here because you will be able to densify and save on space and occupancy costs’. The CFO thinks that sounds great, but the CEO says ‘yes, but my problem is recruiting and retaining; it’s not about space per se. How do I get the talent?’ “We thought about that and realised we can say ‘five years from now, more than half of your talent will be millennials – and they live, work, play’. Once they recognised that, tenants started to flock here. Our pitch was ‘we are going to give you a physical competitive advantage’.” One thing Related has not done at Hudson Yards is embrace trendy architecture. Quite the opposite. The project started in 2008: times have changed in the past decade and will continue to change. “We have definitely pursued timeless architecture,” says Cross. “Nothing trendy. And then we try to be flexible and constantly try to refresh the programme.” [caption id="attachment_966931" align="alignnone" width="847"] Hudson Yards Pavilion Grove[/caption] The power of the brand This 24/7 New York within a New York might have attracted the big commercial tenants. But what about the residents? 15 Hudson Yards will comprise 285 condos on top of 107 affordable homes, and Cross confirms the building is half sold. As for the other half, is there a danger these will be harder to sell in tougher times? “There is no question the market is slowing,” says Cross. “But we think that what we have is unique enough. The price point is high [between $5m and $7m, depending on how high up you are] but it is not unlike Central Park South or Midtown and you are getting comparable quality in a livelier neighbourhood.” So no concerns? “We feel like we are getting our fair share of what is a tougher and tougher market.” There is the fact that the power of the Hudson Yards brand has grown significantly over the past few years. “Most people had no idea where Hudson Yards was when we started,” says Cross. “We had something like less than 7% name recognition. That’s now at 90%. We are creating a vibe, a lifestyle.” The Vessel, a huge piece of interactive public art at the heart of the site, created by British designer Thomas Heatherwick, helps when it comes to cementing that brand, as do the Zaha Hadid Residences at 520 West 28th Street and the fact that the High Line wraps around pretty much the entire scheme. [caption id="attachment_966928" align="alignnone" width="847"] The Vessel at Hudson Yards[/caption] “We are basically one third of the High Line,” says Cross. “And that gets eight million visitors a year and has defied all expectations.” Part of Hudson Yards’ appeal and clout comes from its sheer size. But Cross concedes that this is also what makes his job so difficult. “The public space, the Heatherwick, the Wi-Fi and digital connectivity, the infrastructure… those are all shared expenses,” he says. “But when you have so many different parties on one site, how do you allocate all of those expenses so everyone feels fairly treated? It can be difficult to say to a development manager ‘you can’t opt out’. They might say ‘I don’t want that amenity, so I don’t want to have to pay my share’. And I have to say ‘well, you can’t do that because Hudson Yards is a collective. You are very successful as a virtue of being here so you have to pay your fair share’. It’s a big challenge every day at every level from construction to operations and from budgets to leasing. Everyone is trying to protect their pro forma, as they should. But this is where my adjudication role is so important.” And he has some pretty persuasive figures up his sleeve. Remember the five million workers living within a 40-minute commute? There is little arguing with that. The Number 7 subway was a piece of “critical infrastructure”, says Cross, that was extended from Times Square to Hudson Yards’ front door. “It is the only subway line that goes from east to west,” says Cross. “It connects to almost all the others, so people can get here from Grand Central, from Westchester, from Brooklyn. We are connected below ground and we are on the closest stop to the High Line. We have the Shed on site, which will become a new arts centre, we have the Heatherwick, we have extended the rail tracks so trains can be stacked, ready to go in rush hour, we have public space and we will be a near 24/7 district. As I said before, no other part of town can claim that.” To send feedback, e-mail emily.wright@egi.co.uk or tweet @EmilyW_9 or @estatesgazette