HOBOKEN -- Hoboken and PSE&G will swap a city-owned lot next to an uptown electrical substation for downtown property currently occupied by another substation, which will then be cleared and cleaned up, and possibly turned into a park, city and company officials said.

PSE&G would use its newly acquired lot, along 11th Street between Madison and Monroe streets, for a $170 million facility that would combined the functions of the uptown and downtown substations, elevated above the ground to protect it from the kind of flooding that besieged Hoboken during Hurricane Sandy.

The city-owned uptown lot is larger than the land occupied by PSE&G's downtown substation, and the city would be compensated for the difference, said Juan Melli, a spokesman for Zimmer. PSE&G's downtown property, at 2nd and Marshall streets, is just under an acre.

The acquisition of park space and flood protection have been top priorities for Zimmer, who was elected to her first 4-year term in 2009, but said she will leave office in January after announcing last month she would not run in November. The City Council voted July 5 to authorize Zimmer to enter into a deal with PSE&G for the land swap.

PSE&G released a statement on Friday confirming the swap.

"The land swap between PSE&G and the City of Hoboken has been executed," the statement read. "Preliminary construction will begin immediately after closing on the City-owned property adjacent to the Madison Street substation, with full construction continuing when all necessary approvals and permits are secured. The decommissioning of the Marshall Street Substation will occur when the Madison Street Substation Project is completed."

Melli said the downtown property will not be turned over until well after Zimmer leaves office, since the new uptown substation project must be completed before the one downtown is dismantled and its environmental cleanup is completed. So, Melli said, the mayor was staying out of the debate over what the property should be used for.

Councilman David Mello lives nearby the Marshall Street substation in the city's southwest corner, a former industrial section of the Fourth Ward that in recent years has become increasingly residential.

Mello, who chairs the council's development committee for the area, said he wants to see a park on the site, which he said would provide opens space and act as a pleasant shortcut for commuters walking from the west to Hoboken Terminal on the city's southern waterfront.

But Mello said he also wants to hear the desires and ideas of surrounding residents. Like Zimmer's, Mello's term also expires in January, although he is running for re-election.

"Whether I'm in office or not," he said, I will demand that residents have a say."

Steve Strunsky may be reached at sstrunsky@njadvancemedia.com. Follow him on Twitter @SteveStrunsky. Find NJ.com on Facebook.