Nov. 28 (Bloomberg) -- The Whitney Museum of American Art has announced that it plans to build a branch on the site of two decrepit meatpacking plants on the western edge of Greenwich Village in New York.

That would mean curtains for the museum's proposal to expand with a Renzo Piano tower hovering next to its current Madison Avenue home.

The Whitney's gain is the Dia Art Foundation's loss. It recently withdrew its bid to build on the site.

Meanwhile, the Museum of Modern Art, which you would think would leave well enough alone after raising $825 million to overhaul and endow its Midtown mega-complex, is also talking about another addition.

This churning has to do with three trends that are forcing museums to make extraordinary, difficult bets on the future: spiraling construction costs, dizzy real-estate prices and an art market that's gone bonkers.

Dia hoped to move from a location in Chelsea that it closed in 2004 to the meatpacking-district site, at Gansevoort and Washington streets. The $33 million price tag was a big stretch for Dia, which, with its narrow focus, has not galvanized donors. It's also going through a soul-searching after losing Director Michael Govan, who left early this year to head the Los Angeles County Museum of Art.

``The single-artist presentations that we were known for have been co-opted by galleries,'' said Laura Raicovich, Dia's spokeswoman, adding, ``We want to be more risk-taking, to create the opportunities that artists really need.'' A definitive direction must await a new director.

Sky Above, Room Below

The glory of the Gansevoort site for the Whitney is that it opens to the sky and to the Hudson River. There's room enough for expanses of top-lighted gallery space. (Dia talked about a grand space as large as 100 by 200 feet.) For a museum with extensive holdings in Hopper and like-minded artists, the surrounding industrial blocks abound in their kind of urban anomie.

The visual clash, with blood-spattered loading docks of meatpacking wholesalers bookended by glitzy fashion boutiques and scenester-thronged restaurants, neatly dovetails with the spiky, neurotic products of the museum's ever-controversial biennials.

A further advantage is that the new Whitney will anchor the southern end of the High Line, an abandoned railroad track that the city has begun converting into a lush, elevated park.

The Whitney has a credibility problem, however. For more than 25 years it has abandoned designs for additions to its 1966 Marcel Breuer building by Michael Graves (1985), Rem Koolhaas (2001) and now the Genoese architect Piano.

Plan Too Small

Piano's gallery spaces are already seeming too little -- and perhaps too late, if the museum hopes to capture donations of megacollections being amassed by the new superrich. Because Piano's tower would have to be painstakingly wedged behind landmark brownstones, its cost had ``escalated wildly,'' Whitney spokeswoman Jan Rothschild said by telephone (though she would not name a figure).

The Whitney has pledged to continue with Piano, but his Madison Avenue design expressed constraint rather than aspiration. The museum's intentions would be more convincing if it chose an architect who could create the robust presence the Gansevoort setting demands. It does not need another of the spindly glass-and-metal pavilions -- impeccable in their way --that Piano has reproduced in an increasingly formulaic way since Houston's brilliant Menil Collection of 1987.

MoMA Adds More

While the Whitney switches gears yet again, MoMA has quietly put another $20 million into the massive ``New MoMA'' it opened in 2004. The cash went to Yoshio Taniguchi's fitout of 63,000 square feet in the Midtown complex for the Lewis B. and Dorothy Cullman Education and Research building. It opens today.

With its educational spaces and posh curatorial study centers, the project was to close the museum's 10-year building program.

Perhaps not. In a press walkthrough, MoMA Director Glenn D. Lowry spoke of plans for 17,000 square feet of land the museum has assembled to the western side of its building. The area was supposed to be held for future needs, but with land prices going through the roof, ``many of our trustees feel the institution cannot let it lie fallow,'' he explained.

Though he stressed that no decision had been made to go forward, the museum could add income-producing commercial or residential space above more galleries, totaling as much as 210,000 square feet.

Approach warily, please. Taniguchi had no easy time wrapping the revamped MoMA around the Museum Tower, which splits the building as it pokes 55 obtrusive stories upward. The tower underwrote MoMA's unfortunate 1985 remodeling, almost none of which survived the Taniguchi overhaul.

Growth a Gamble

With costs such a wild card, growing now for both Whitney and MoMA is more of a gamble than ever. And prudent as it may be for Dia not to grow, the loss of its major Manhattan presence may cost the foundation the support it needs from collectors and artists. I don't envy any of them.

For more information about the Whitney Museum of American Art: http://www.whitney.org. Dia Art Foundation: http://www.diacenter.org. Museum of Modern Art: http://www.moma.org.

(James S. Russell is Bloomberg's U.S. architecture critic. The opinions expressed are his own.)

To contact the writer of this story: James S. Russell in New York at jamesrussell@earthlink.net.

Last Updated: November 28, 2006 10:32 EST