Second Coming: The East Side Awaits the Second Avenue Subway

The pricey project was first proposed in 1919 without ever really materializing; it was then proposed again in the 1930s under the premise that an underground train serving Second Avenue would replace the above-ground trains that ran along Second and Third Avenues at the time, which would be demolished, but, again, never came to fruition (thanks to the city’s financial issues).

Another attempt was made and thwarted in the 1970s following the fiscal crisis when New York City neared bankruptcy under Mayor Abraham Beame. The state Metropolitan Transportation Authority finally pushed the proposal forward again in 2004, and construction began in 2007.  MTA spokesman Kevin Ortiz told Commercial Observer that the agency is currently “on schedule and on budget” to complete phase one in time for New Year’s Eve, but on  July 26 The Wall Street Journal reported that the MTA would be pushing “pre-revenue operations training” back by a month, until Oct. 1, potentially adding additional pressure around the first stretch’s due-date.

“If it was important to build 50 years ago, it’s even more important to build now because New York City has more people living here, more people working here and more people visiting than ever before,” said Richard Anderson, the president of the New York Building Congress who recently announced that he would be stepping down at the end of 2016. “The travel demand is greater than ever, particularly on the East Side. That’s the great value in the Second Avenue subway—congestion relief.”

Congestion is a mild way of putting it. The MTA anticipates that over 200,000 customers per day will use the shiny new line along the 33-block route. “Our Lexington Avenue line—the 4,5,6—is the busiest line,” Ortiz told CO. “We move around 1.5 million people on that line alone every single day. And to put that in some context, that’s more than the total ridership of Chicago, Boston and Washington combined.”

Constructing a new subway line in the most densely populated city in the country without ruffling the feathers of Upper East Siders is, of course, tricky to say the least.

The MTA has had to be conscious of those living and working around the construction area during phase one. “There are many challenges when trying to mitigate the impacts of this construction on businesses and residents of the area,” Ortiz said. “Part of it is keeping the community at large updated on the aspects of the project. I think that has made a huge difference in that the folks in the area know the importance of the line’s construction, and even though they have been inconvenienced for several years now, they are seeing the light at the end of the tunnel at this point, so to speak, and understand the benefits that will come once this part of the project is completed.”

One of the parties responsible for the behemoth task at hand was construction giant Skanska, which won three separate contracts under phase one of the Second Avenue subway’s capital program. Skanska was responsible for designing specific engineering solutions for the site, including never-before-used pieces of equipment, said Mike Viggiano, an executive vice president on Skanska’s civil infrastructure team in the Northeast.

“Dozens of contractors, including Skanska, participated in the construction of the first phase,” Viggiano said. “But we are one of the few contractors, if not the only one, that touched each portion of the construction project including boring the tunnels from 96th Street down to 63rd Street, excavating the 86th Street station and managing the installation of the rails and the communications systems in all three of the new stations subway stations—72nd Street, 86th Street and 96th Street.”

The construction of phase one began with a massive excavation around the East 96th Street station and digging two tunnels all the way down to East 63rd Street. During the tunnel boring process, Skanska was faced with a geological challenge—instead of solid rock, the material at the construction site was filled with water and soil, making tunnel boring extremely difficult.

“To overcome this challenge, we did something really cool—we froze the ground,” Viggiano said. “Our team drilled pipes with chilled brine into the ground to lower the temperature of the soil and freeze the material to make it act like rock. That process took about four months. This solution gave us a safe, solid structure for the project.”

The tunneling operation took place while schiavone construction, another contractor on the project, was excavating the cavern roof directly above Skanska at East 72nd Street.

“It was both dangerous and ambitious to have both teams working directly above and below one another,” Viggiano said. “We worked closely with the MTA and Schiavone to ensure we could safely co-exist and work on both projects at the same time. In short, it was like digging the basement of a house while someone else is working on the roof.” This was the first operation of its kind for New York City, and both teams were able to perform their jobs safely without any incident. During tunneling, Skanska designed a special piece of equipment, which moved large amounts of excavated material off site each day. The material was then brought to several other developing sites to be repurposed for other projects throughout the city.

The 86th Street station was next on the agenda, which required hard rock mining and structural lining of the cavern, which would become the new station. It is no surprise that doing major construction in such a densely populated neighborhood like the Upper East Side is a logistical nightmare, and safety was Skanska’s main concern. “Excavating 450,000 tons of rock from someone’s neighborhood in a major city is not a challenge you are faced with every day,” Viggiano said. “We had to do this safely and effectively without relocating the hundreds of thousands of people who live there.”

In order to do that, Skanska built many specialized pieces of equipment. For example, during the East 86th Street excavation Viggiano said his company developed a “muck handling system” that was purposefully designed with specific enclosures in order to control dust and noise for the surrounding neighborhood.

“With this piece of equipment, we moved between 50 and 60 buckets of rock each day while keeping noise and dust to a minimum,” Viggiano explained. “Each bucket held 15 cubic yards of rock, which equals 23 tons of rock.”

In the process of blasting rock underneath residential buildings, Skanska had to be extremely careful not to compromise the foundations of neighboring buildings. “At the 86th Street station, we engineered a special support system for a 30-story residential tower in order to safely excavate the foundation of the building to create a space for an escalator at the corner of  83rd Street, for an entrance to the subway station.”

Rudin Management is one owner-operator with a significant residential portfolio on the Upper East Side, including 215 East 68th Street, 254 East 68th Street and 300 East 57th Street, all right off of Second Avenue. “We’ve been going through the construction process. It’s not the greatest, but it’s short-term pain for long-term gain,” said Rudin Management Chief Executive Officer William Rudin.

Rudin comes from a long line, no pun intended, of Second Avenue subway advocates. His father, uncle and grandfather all supported its construction. “It’s always been a dream of our family, to have it completed,” Rudin said. “We have a saying in the business, ‘If we can’t get there by subway, we don’t want to own it.’ So throughout our family’s history, public transportation has been very important in terms of where we locate our properties. If you look at where the Rudin portfolios are located, they are in very short walking distance to public transportation, particularly a subway, or next to a subway entrance like we are here [at Rudin’s headquarters at 560 Lexington Avenue between East 50th and East 51st Streets].”

Rudin believes the new subway will have a tremendous impact along Second Avenue itself and further east. “You’re already seeing this on First Avenue—some of the stores that were impacted negatively [by construction] are already being refilled and the retail vibrancy will only get better. New bars and restaurants are coming into the area in anticipation of the Second Avenue subway opening.”

Rudin also pointed to the increased development of medical facilities along the East Side, including the Memorial Sloan Kettering Rockefeller Research Laboratory at 430 East 67th Street between York and First Avenues. “The subway will help get the workers at those facilities over there, and I think you’ll see more infill [in terms of development],” Rudin said.

While residents and businesses have labored under the impact of the protracted construction timeline, other developers, owners and operators are also excitedly anticipating the arrival of the new line.

Anbau is in the process of constructing Citizen360, a 34-story, 209,000-square-foot condominium at 360 East 89th Street between First and Second Avenues. Stephen  Glascock, the president of Anbau, said the subway line was a big consideration in the firm’s decision to develop the property.

“We see the Second Avenue [line] as transformative to that area. My wife and I raised our family on Lexington [Avenue] and 93rd [Street]. Yorkville is a great yet overlooked part of the city. Once the subway goes in it will be that much more accessible,” he said. Glascock said that he believes further development of the East Side will follow. “The whole area is going to go through a renaissance because there are great restaurants and excellent schools in the area that will draw people there. This city moves on its subways. If you can be within five minutes of the subway there, it’s going to open up the whole area.”

Additionally, his residents can expect to see more retail popping up. “It’s already happening along East 86th Street and is going to continue along the avenues [around the new subway line] as well. What’s wonderful is that there is such strong character there and that isn’t going to disappear. There are a lot of mom-and-pop shops that will stay, and there will also be new retail that comes in.”

Despite Anbau’s Citizen360 property being under development at the same time as phase one of the subway (both scheduled for completion in 2017), there haven’t been any big problems, Glascock said. “It’s actually been good timing for us. Once the Second Avenue subway is finished up in the next six months or so, the area is going to shine. It’s kind of like a big unveiling.”

Anbau’s building includes three- and four-bedroom apartments, and Glascock said that tenants who are seeking family-sized apartments are happily also looking for multiple points of access into the rest of the city so the subway, in conjunction with the potential East River ferry terminal that has been proposed for East 90th Street, will be a big draw.

“Like any property close to Second Avenue, our buildings have been impacted by sidewalk and street closures, often for months at a time,” said Adam Roman, the chief operating officer and a principal at Stellar Management, another owner-operator along the subway’s route. “Because of this, Second Avenue’s retail presence has dwindled over the [past eight] years. A lot of businesses, particularly restaurants, haven’t survived given the reduced foot traffic and storefront visibility. However, we have seen a notable increase in retail demand and rents along Second Avenue now that construction is nearing an end.”

Roman continued, “We’re hopeful it will reduce congestion and improve mass-transit efficiency and comfort, both of which benefit our residents. Additionally, we feel properties located near the new Second Avenue subway stations will increase in value once the line is up and running.”

Not everyone agrees that it means a boon for Upper East Side retail and residential properties, however.

“I don’t think it’s going to be a big stimulus because [the East Side] is such a densely developed area already,” Anderson said. “From an economic development standpoint, the number 7 extension is a much better value. Will it open up large new areas for development like Hudson Yards? No. It might help uptown—toward 125th Street—but I don’t see it densifying the East Side too much.”

With the project’s eye-watering total price tag, it’s easy to see why the subway’s construction was halted so many times, but in New York City it was never going to be cheap, Anderson said.

“Transit construction in New York City is very expensive because it’s a densely populated city, and so it’s difficult logistically, and also the high cost of doing business here is legendary,” said Anderson. “We pay people more, we have onerous union work rules, and the government adds to the cost of construction considerably with procurement requirements and procedural requirements. So yes, if you change what the government does, if you renegotiated some of the labor contracts, if you found other ways of executing the projects—if we used more design-build construction techniques for example—we could have brought the price down. But you’re starting from a high cost threshold because it’s New York City.”

Those preparing to bid on phase two of the line, which is a segment to the north and has no set timeline as of yet, will have some stiff competition. “Our team is proud to have played such a critical role in the first phase of the Second Avenue subway project, and we will certainly be bidding for work during the second phase once it becomes available,” Viggiano said.

As phase one’s completion date draws near, it’s safe to say that excitement is in the air.

“It’s generally a successful story—sure it’s late but better late than never,” Anderson said. “It may not open exactly on Jan. 1 [2017]. But it will be close, and I think it will get good marks. People will like it, and the routes will make sense. Then the focus will be on ‘When do we get the next phase?’ ”

Rudin sees the investment as a worthwhile one and is excited for the next generations.

“You have to invest in infrastructure, and I can’t wait to take my granddaughter and grandson on the brand new subway. It will be great to have something shiny and new,” he said.

More simply put, “The train is coming—and we can’t wait!” Glascock said.