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The Metropolitan Transportation Authority (MTA) announced yesterday that it closed on the first of two 99-year ground leases with the Related Companies and Oxford Properties Group, which plan to build a platform over Long Island Rail Road's Hudson Yards on Midtown Manhattan's west side.

The companies also plan to develop 26 acres with a new neighborhood containing 13 million square feet of office, retail, residential, cultural and hotel space, MTA officials said in a press release.

Under previously disclosed terms of the lease, Related and Oxford will provide ground lease payments and retain purchase options that, together, are worth $1 billion. Closing on the second lease is expected later this year. The revenue will support MTA's capital program.

The MTA-owned portion of the Hudson Yards development area, where the new platform will be built, is bordered by 10th and 12th avenues and West 30th and 33rd streets. The new mixed-used neighborhood will be served by an extension of the 7 subway line to 34th Street and 11th Avenue. Service is slated to begin in June 2014, MTA officials said.