Raleigh, N.C. — Plans to convert a former warehouse west of downtown Raleigh into a regional transit hub received a boost Friday when the U.S. Department of Transportation awarded the city a $21 million grant.

Planners want to transform the old Dillon Viaduct Building on West Martin Street into Union Station, which would replace the 62-year-old Amtrak station on Cabarrus Street. The first phase of the project is projected to cost about $75 million.

The grant from the federal Transportation Investment Generating Economic Recovery program, or TIGER, would help pay for the first phase of improvements, including renovating the building, constructing various track, siding and platform improvements and extending West Street.

"Everybody knows that a strong infrastructure is vital to a city's economic future, and this a vital part of what is going to lead Raleigh into this next century, to make us bigger and better than we are," Mayor Nancy McFarlane said.

Union Station, which could be completed in three years, would handle Amtrak, freight trains, high-speed regional service and commuter rail, as well as Triangle Transit and Capital Area Transit buses. The station also will be a major stop on the Southeast high-speed rail corridor from Washington, D.C., to Atlanta.

McFarlane and other city officials said Raleigh would continue looking for other funding to develop the area around the station.

Raleigh's chief city planner, Mitchell Silver, said he expected Union Station to be a "big, big boost" to commercial and residential development in the surrounding areas. 

Local voters approved spending $3 million on the project when they passed a transportation bond last fall, and officials said Raleigh would chip in another $4 million by shifting money from other projects and generating revenue through new fees.

Union Station is one of 47 projects nationwide to receive almost $500 million combined in TIGER grants, U.S. Transportation Secretary Ray LaHood said Friday. More than 700 projects sought funding.

“This grant for Raleigh’s Union Station means good jobs for North Carolina today and greater mobility that will generate economic benefits well into the future,” LaHood said in a statement.