Amtrak's Penn Station plan could funnel taxpayer money to new venue for James Dolan

Amtrak’s proposal to rebuild Penn Station could lead to heaps of taxpayer money being used to subsidize a new entertainment venue for the Madison Square Garden Company.

The plan to overhaul the station calls for Amtrak to purchase the Infosys Theater at MSG, demolish it and convert the site into a grand light-filled entrance on Eighth Avenue. Previous estimates have put the cost of purchasing the theater at hundreds of millions of dollars.

During an investor’s call Wednesday, MSG’s chief financial executive David Collins fielded questions about the potential sale of the theater, which has a capacity for roughly 5,600 people. He noted the move would take away a revenue source for the company — but said the money from the sale could be used to fund a new venue, potentially in the five boroughs.

“The primary way for us to minimize the tax leakage would be to reinvest all of the potential proceeds in another domestic venue. … I would say that we are not limited to just the New York City market,” Collins said. “However, I would also say that New York City is our core operating market and with us having one less theater here, we would definitely most likely look to the New York market first.”

He did not say whether the Garden would look to buy an existing venue or build a new one.

In recent years James Dolan, the billionaire owner of MSG and the New York Knicks, has struck gold with his Las Vegas Sphere. That cutting-edge venue has a capacity for 20,000 people and has been so successful that Dolan is building another sphere at National Harbor on the Potomac River , just outside of Washington, D.C.

Amtrak special adviser Andy Byford, who is leading the redesign effort of Penn Station, has repeatedly said that the national railroad is looking to get us much money in federal grants and before potentially seeking funding from New York and New Jersey. That means if Amtrak's plan goes through, taxpayers would likely be on the hook to purchase the Infosys Theater — and in turn to fund MSG’s new theater elsewhere.

Representatives for MSG and Amtrak did not immediately respond to requests for comment.

MTA Chair Janno Lieber has repeatedly criticized Amtrak’s plan and has declined to sign on as an official partner for the rebuild, stating the work could interrupt Long Island Rail Road service at the station. Lieber has said Amtrak has refused to disclose the full details of its plan unless the New York transit agency agrees to join the project.

The MTA was planning its own rebuild of Penn Station — which is owned by Amtrak — until President Donald Trump took over the project last year. Lieber in 2023 said he did not want taxpayer money to be used to purchase the theater, saying he thought “the Dolans have gotten a pretty good deal from New Yorkers so far.”

While the MTA’s plan was under consideration that year, a private developer with ASTM Group estimated at a public hearing that the cost of purchasing Infosys was “substantially less” than $1 billion. The estimate came from Peter Cipriano, who is now CEO of Penn Transformation Partners, which was selected by the federal government to redevelop the rail hub.

Dolan supported Trump’s 2024 election campaign and this year backed Republican gubernatorial candidate Bruce Blakeman, who lost this week to Gov. Kathy Hochul.

MSG’s latest Securities and Exchange Commission filing lists the redevelopment of Penn Station as having a potential impact on its financial outlook, including the “potential transfer” of the Infosys Theater.

The Trump administration has set a tight deadline to begin work on the redevelopment of Penn Station. Officials said they expect shovels in the ground by the end of 2027.

Collins said during MSG’s investor call that executives “expect ample time to determine the appropriate path forward” on selling the theater.