Overhaul of NY Penn Station, post office advances

September 27, 2016 5:49 PM EDT

Travelers with suitcases wait for trains in Pennsylvania Station in the Manhattan borough of New York December 27, 2015. REUTERS/Pearl Gabel

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By Hilary Russ

NEW YORK (Reuters) - New York State officials on Tuesday chose developers for a $1.6 billion project to renovate a century-old historic post office, part of a broader plan to modernize Pennsylvania Station, the outdated labyrinthine train hub in the heart of New York City.

The preferred bidder, a team comprised of Skanska AB, Related Companies and Vornado Realty LP, has agreed to a fixed price and schedule, New York Governor Andrew Cuomo said at a luncheon for the business group Association for a Better New York.

The plan to renovate the James A. Farley Post Office, across Eighth Avenue from New York's Penn Station on the west side of mid-town Manhattan, was first proposed 20 years ago but stalled in the intervening years.

Cuomo hopes to re-launch the project as part of a broader regional $100 billion transportation overhaul.

Calling plans for the new train station magnificent, Cuomo said: "It gives you a sense of openness, as opposed to claustrophobia and suffocation that you now have."

Separately on Tuesday, regional transport officials said they had been meeting with the U.S. Department of Transportation to secure funding for Amtrak's $24 billion Gateway Project in the next federal budget.

That project would double passenger trains under the Hudson River between New York and New Jersey and rebuild bridges and other facilities.

The "very substantial" discussions have been about railroad rehabilitation loans and Federal Transit Administration grants, John Porcari, interim director of the Gateway Development Corporation, told Reuters after another event.

Though Gateway is a distinct project, it would tie into the Farley building and its new Moynihan Train Hall.

Once completed, the hall would be larger than New York's famed Grand Central Station. The original steel trusses from the early 1900s would be refurbished, along with a skylight that would stretch for an acre, Cuomo said.

Also planned are retail and office space and advanced security measures, including facial recognition technology.

Both the Long Island Rail Road (LIRR) and Amtrak halls would be moved there.

Under a separate contract not yet awarded, the Metropolitan Transportation Authority (MTA) would then redesign the maze of tunnels that make up the LIRR concourse in Penn Station. The MTA on Tuesday was to send out a request for proposals.

The new, $170 million revamped concourse would be wider and higher, complete with video screen-lined ceilings displaying images of a blue sky with white clouds, Cuomo said.

(Reporting by Hilary Russ; Editing by Daniel Bases and Andrew Hay)

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