More Thoughts On Non-Communist Transit

After my last post, I googled around looking for more info on the history of the Hong Kong system and I didn’t find that much because things that work smoothly rarely get press. I did come across a very interesting group of people looking to make money in Chinese mass transit by acting as property developers. It’s pretty self evident that mass transit enables more intensive and profitable land uses near the lines.

“Katz and Lane, however, propose to make their project financially viable by acquiring and developing the real estate along the proposed transit lines. “An investment in rail enhances the value of real estate,” says Katz. “And yet in the United States, rail development has failed for political, economic or policy reasons to capture the benefit in real estate that rail created. Most systems don’t recover 50% of operating expenses.”

The idea of capturing increased land value to fund mass transit is not new. In Hong Kong, the MTR Corporation operates the railway and was given the rights to develop residential and commercial properties above the stations. According to Lai, who is also president of the International Chinese Transportation Professionals Association, the Hong Kong subway system is the only one in the world today that is making money.”

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