(Reuters) - Plans to expand New York City's famous Pennsylvania Station, the busiest passenger rail facility in the United States, will begin later this year with a $270 million project to improve access to underground passenger platforms, officials said on Tuesday.
The project will be the first phase of the long-delayed Moynihan Station, an ambitious effort to regain some of the grandeur lost when the original Pennsylvania Station was torn down in the early 1960s and replaced by the Madison Square Garden arena.
When the entire project is completed, the adjacent James Farley Post Office, which resembles the original Penn Station and is just across Eighth Avenue, will become a new passenger facility. The long tracks and platforms under Penn Station already extend under the Farley building.
A sources familiar with the bidding process said that Skanska on Wednesday will be awarded a $148 million contract to add two street-level entrances, one each at the 33rd Street and the 31st Street sides of the post office, to the platforms below.
The company will also widen and extend an underground concourse to help passengers reach the three railroads that use Penn Station: New Jersey Transit, Amtrak and the Long Island Rail Road.
The remaining $122 million of the first phase will be spent on a ventilation system and an underground walkway to Penn Station. Funding for the first phase is coming from the federal government and other sources.
Officials said the first phase should be completed in 2016, with the next phase creating a new passenger terminal in the Farley building that will be six stories high and topped by a glass skylight. It will cost $500 million.
Phase Two is unfunded, however, and talks with the developers, Related Cos and Vornado Realty Trust, are ongoing.
Patrick Foye, the executive director of the Port Authority of New York and New Jersey that is overseeing the project, told reporters: "This project is going to happen and we expect the commitment will accelerate those discussions" with the developers.
The Moynihan Station is so named because it was promoted by the late U.S. Senator Daniel Patrick Moynihan in the late 1990s. The other important New York passenger rail facility is Grand Central Station
Reporting By Joan Gralla; Editing by Philip Barbara