The development teams behind Time Warner Center in Columbus Circle and the Bloomberg Building in Midtown Manhattan have won the right to redevelop New York City's Farley Post Office into a new transit-oriented urban hub with retail, office and residential space. A 50/50 joint venture between Vornado Realty Trust and The Related Cos., beat out Boston Properties, a collaboration of Staubach Co. and LCOR Inc. and Jones Lang LaSalle working with Tishman Speyer Properties. The aim is to elevate Penn Station to its former glory and rival that of New York's Grand Central Station.

The development, to be named after the late Senator Daniel Patrick Moynihan, will connect to New York's Penn Station. It includes 300,000 square feet for a new transportation facility to be financed with public funding, as well as 850,000 square feet of commercial space and up to 1 million square feet of air rights intended to be transferred to an adjacent site.

But the close-lipped developers refused to comment on the announcement and have not let slip any further details on how they envision the site. The project has cycled through several different design teams and false starts since originally announced more than five years ago. Originally, the redeveloped project was slated to open in 2003.

One thing is for sure, however. The retail on site will undergo a dramatic upscale redevelopment. Today most Penn Station retail is located along dark, subterranean tunnels. It consists largely of fast food stands and news vendors. Faith Hope Consolo, chairman, Prudential Douglas Elliman, who has worked on the project as a consultant in the past, thinks the development team was the right choice.

"Whatever goes on with the city or state, they have the money to do this project right," Consolo says, "They have both worked on large-scale projects like this in cities before. ...Vornado being committed to the area has a lot to do with it. They've improved that area 100 percent." Vornado owns nearby One Penn Plaza and three other buildings near the site.

Although the exact amount of retail space is unknown, Consolo anticipates the concourse will be similar to the mall that used to sit below the World Trade Center. It will have a mix of large and small tenants, ranging from big boxes to bookstores.

For Vornado, this is just the latest in a recent series of high-profile projects and deals. They invested in Sears, Roebuck & Co. right before its merger with Kmart Holding Corp. They were part of the winning bid to takeover Toys 'R' Us. And they paid $113 million for the ritzy retail portion of the former Westbury Hotel on Madison Avenue.

-- David Bodamer