Times Square has long been associated with Broadway theater and towering hotels, but big-name architecture is a recent arrival, with the likes of Renzo Piano and FXFowle popping up only in the last decade. The Related Companies is bringing all three attractions together under a 59-story roof as construction gets underway on a new hotel and condo project on 10th Avenue.

The $800 million tower is being designed by Times Square veterans Arquitectonica, while Frank Gehry is making his debut in the neighborhood with a performing arts complex for the Signature Theatre Company in the base of the new building. Today, the developer announced a $25 million contribution to the project from the Bloomberg administration, helping secure the Signature’s new $60 million performance space.

As in any good drama, the theater company has had its ups and downs as it sought a new home. First, it was to be part of a $700 million cultural pavilion at Ground Zero shared with the Joyce Theater. When that project faltered, the Signature looked across the street at Fiterman Hall, a condemned CUNY building that had been completed just before the 9/11 attacks and needed to be rebuilt, though that too would have cost hundreds of millions of dollars. Eventually, the company came to a tentative agreement with Related last fall for space in the new tower, a deal that was finalized by today’s announcement.

“This was just the perfect arrangement for us,” James Houghton, founding director of the Signature Theatre Company, said in an interview after the event. He added that Gehry has remained on the project throughout, and is now putting the finishing touches on models of the design, which will be displayed in a room of their own at the Manhattan Plaza garage, halfway between the company’s new home and its old one on 9th Avenue.

Though Houghton repeatedly referred to Gehry’s design for the new theater as “modest,” he insisted that the project cost less than a tenth of what it did at Ground Zero for good reason. To begin with, the Joyce is no longer involved, cutting the programming in half.

There are further savings because the foundation for the project, so to speak, is already in place, as the Signature will pay only for the fit out of its new space in the Related building, whereas before it was navigating the morass of subway lines and supply roads that ran some five stories beneath the original project at Ground Zero. It also has a larger footprint in the new building, meaning that three theaters—one 300- and two 200-seaters—two rehearsal spaces, and a lobby, cafe, and bookstore can all occupy one floor instead of being balanced across multiple stories.

The recession has also benefited the project as construction costs have fallen, with $60 million buying much more than it did a few years ago. “The numbers tell the story,” Houghton said. “We’ve got the same programming but a much more affordable result.”

Fundraising has also been robust, with $16 million already committed to the theater from donors, which leaves $19 million remaining after the city’s $25 million grant. Nonetheless, Houghton anticipated construction beginning next year, with completion due by 2012.

At today’s press conference, Mayor Michael R. Bloomberg called the project a sign of the city’s ongoing recovery. “The fact that Related Companies is moving forward with the major development project now is great news and will have a profound impact, not only on the cultural industry and the city’s skyline, but also on the local economy,” the mayor said.

Related has had its own travails at the site, which went dormant last fall. As did the theater, the developer used the opportunity to negotiate more favorable contracts with suppliers and trade unions, and construction commenced in September. The Arquitectonica- and Ishmael Levya-designed project is seeking a LEED Silver rating, and will include 800 affordable and luxury housing units and hotel rooms. Related spokesperson Joanna Rose said that previously published renderings of the project are out of date, though new ones can be expected some time after Gehry unveils his design.

Related is also celebrating today because its rezoning of Hudson Yards was approved yesterday by the city council, following approval of a new affordable housing arrangement by the planning commission. Asked whether that project, which was planned by SOM, would include high-profile designers like Gehry or Arquitectonica, Rose said that decision is still being made. “We haven’t made any determination on who the architects will be for the individual buildings,” she said.