Amtrak could be going into the real estate development business, turning some of the country's ornate but faded train stations -- such as D.C.'s Union Station -- into the newest Faneuil Hall or Ghiradelli Square.
Following the example of railroad barons who made fortunes off real estate holdings, Amtrak has begun looking for ways to exploit commercially the stations that came with the trains and the tracks.
"We've done passenger service-type concessions, but we haven't really moved to take advantage of the commercial possibilities and the romance of train stations" or the impact stations may have on urban development, said Lawrence A. Gilson, vice president for government affairs for Amtrak.
Many of the stations that Amtrak is looking at with an eye toward development are in the heavily traveled Northeast corridor. Besides Union Station, the railroad corporation also is interested in potential commercial development of the railroad station and surrounding property in Philadelphia, some development of the Newark station in the middle of an urban renewal area and more development within New York's Pennsylvania Station where a major restaurant already is set to open in July.
Amtrak also is interested in the potential of the Baltimore station although development interest in that city is focused on the inner harbor area.
What prompted the interest in development was a need to diversify Amtrak's revenue base to reduce its deficit and the public-private corporation's sense that "our obligation extends beyond just providing rail service," Gilson said.
Amtrak has contracted with the Urban Land Institute to put together a panel of land-use planners and developers to devise plans for developing Union Station commercially, and has talked to city officials about prospects for developing the station. The city would be happy to see some development such as restaurants and boutiques at the train station, as long as development there didn't compete with the city's plans for a major retail development in the old downtown area near Metro Center, said John Fondersmith, of the city's planning office.
Union Station "is a different kind of thing," he said. "We talked to them about it and expect their panel would reinforce that," said Fondersmith. Commercial development at Union Station "could be exciting and create much more activity, but it won't be and nobody should think it would be on the same scale as downtown," he said.
Actual development of Union Station, however, depends on passage of legislation pending in the House of Representatives that would turn the building's concourse back into a train station augmented by commercial outlets.
When the National Visitors Center was built in the early 1970s, the train station was moved into a temporary rail terminal behind the concourse. The Visitors Center opened on July 4, 1976, but 4,000 parking spaces, a ramp and a roadway circulation system never were completed. In the years since it opened, the Visitors Center has gathered as many cobwebs as visitors. The Visitors Center would be confined to the front of the building with Amtrak taking over the concourse.
With a Metro stop there, "the whole lunch-time crowd from Capitol Hill and an improving neighborhood with no real commercial space in it," the train station's commercial possibilities are attractive, Gilson said.
"We're looking at a Faneuil Hall or Ghiradelli Square-type proposition that would take advantage of the architectural beauty of the station," he said. Faneuil Hall in Boston and Ghiradelli Square in San Francisco are modern commercial developments that preserved distinctive older parts of those cities.
With the revenue it made from leasing commercial space, Amtrak could help defray annual federal costs of $3.5 million for space in the station, Gilson said.
In New York, expanded commercial use of Pennsylvania Station is under way. A $2 million restaurant that will seat 650 diners will open there in July. The restaurant, Leo Lindy's, is being built by the owners of Luchow's, Toots Shor's and Mama Leone.
Additional development of railroad stations along the Northeast rail corridor, where the Amtrak owns the stations, depends on legislation approved Friday by Congress allocating $750 million to complete improvements in the corridor. Some of the stations, such as the Trenton station, are scheduled for such improvements as major cleanup and better connections with intercity buses but not for commercial development.
Amtrak also is looking at possible commercial development of stations in other parts of the country where it leases space.
"We've been approached about stations in our Northeast corridor and all over both by public entities and private interests," Gilson said. "We've in serious discussions in about half a dozen large cities around the country, including Washington."