Governor Kathy Hochul is instructing Janno Lieber, the Chairman of the Metropolitan Transportation Authority, to market the agency’s vast real estate holdings for large-scale real estate development. The MTA owns expansive rail yards inside every borough of New York City, where it stores and repairs its trains.
Hochul believes that redeveloping those train yards into high-density mixed use urban centers will increase longterm ridership on the MTA’s subway and commuter rail systems by locating hundreds of thousands of new jobs and housing units immediately atop the system’s own real estate, in locations all across the city.
In some cases, the rail yards present sweeping waterfront redevelopment opportunities — like the 65th Street Yard in Bay Ridge, the Long Island City Yard in Queens, and the 207th Street Yard in Inwood. The Hochul administration is in the process of planning redevelopment initiatives in each of those neighborhoods.
Some figures in the administration have been encouraging Hochul to propose an ambitious goal of constructing 500,000 new affordable housing units on MTA property in ten years. The plan would call for a slew of site-specific public private partnerships, and would rely on an enormous private sector mobilization of capital — perhaps costing institutional investors more than $200 billion to construct.
“Governor Hochul is ordering the MTA to make the real estate available, but the state will not finance these projects. The state would partner with private developers who would secure financing from the capital markets,” the executive chamber staffer explains.
“The primary financial benefit to the public will be significantly increased usage of the subway and commuter rail systems, the new revenue from which will create operating efficiencies,” he adds.
The advisor explains that 500,000 new housing units would be expected to house at least 750,000 individuals, who each would pay $120 each month for MetroCards. That additional ridership would accrue an additional $1.08 billion in revenue to the MTA every year.
Additional ridership volumes on the Long Island Rail Road and Metro North systems would also be expected as a result of the new real estate developments, which are expected to also serve as massive new employment centers — with millions of square feet of new Class A commercial office space.
“Hochul wants every borough to have multiple ‘downtown’ areas, so that the region can decentralize New Yorkers’ commutes,” he adds. “Folks don’t want to commute into Manhattan every day. If you want workers in the office, let them work closer to home.”
He expects the MTA to issue a slew of Requests for Proposals over the next two years, and believes that the Governor will insist that proposals exceed 10 million square feet in total space.