Here are some key data points for understanding the Penn Station / MSG situation:
1) The Dolans only own half the air rights.
2) The other half are owned by the Vornado Realty Trust,
who'd stand to benefit in the billions if offices were to be built in/with the air rights, rather than MSG
3) MSG needs a permit to operate as a venue.
The first 50-year permit ran 1963-2013 and was renewed til 2023.
The Dolans want it in perpetuity, Advocates want it revoked.
4) Zoning requires that any redevelopment redevelop Penn Station.
Attached to the Garden is 5.4 million square feet of development rights—air rights that, per a provision in the zoning, are locked and unusable unless Penn Station is completely remade. But, according to numerous officials who have worked on the project, the way Penn Station is constructed makes it difficult to do any sort of major renovation of the dimly lit claustrophobic transit hub without first removing the Garden and then stripping down the entire station.
5) So the air rights' usefulness are double-limited
: If MSG remains within the air rights, it needs a permit. If the air rights gets redeveloped, that requires renovating Penn Station.