The nation’s largest statewide public transportation system has crafted a plan to generate up to $1.9 billion in non-fare revenue over the next 30 years by unlocking the value of its 8,000-acre real estate portfolio in New Jersey.
NJ Transit, based in Newark, New Jersey, unveiled what it called its comprehensive road map to leverage its holdings. It aims to take advantage of a variety of opportunities for its properties, including Transit-Oriented Development, or TOD, retail concessions, industrial hubs and advertising.
“The plan offers a unique opportunity to generate essential funding by leveraging its underutilized assets for development, as well as enhancing its customer experience,” NJ Transit said in a statement. “The plan presents a series of potential opportunities and suggested actions for consideration to maximize the associated potential revenue.”
Additionally, the plan could add up to $14 billion in economic impact to New Jersey, which would manifest as up to an additional $1.6 billion in municipal revenues, up to 50,000 new jobs and up to 20,000 new housing units, according to NJ Transit.
“The plan’s proposed actions are presented merely as options for consideration — not mandates — to support the plan’s full revenue potential,” NJ Transit President and CEO Kris Kolluri said in a statement.
Helping fund NJ Transit
The analysis demonstrates “a self-sufficient way to help keep NJ Transit funded and is a major boost to New Jersey’s economy,” according to Patrick Diegnan, state Senator and Senate Transportation Committee chairman.
The kind of project NJ Transit wants to attract is exemplied by Hackensack Meridian Health, which has a new facility that’s part of a $200 million mixed-use transit village being developed at Metropark Station in the Iselin section of Woodbridge, New Jersey.
The Hackensack Meridian Health and Wellness Center at Metropark will offer such services as primary and specialty care, urgent care, rehabilitation and a retail pharmacy. There is also a housing component to the transit village at the train station, which is along Amtrack’s Northeast corridor.
“Our project is a perfect example of the greater potential unlocked through NJ TRANSIT’s impactful real estate plan,” Jose Lozano, Hackensack Meridian executive vice president and chief growth officer, said in a statement.
The development of “walkable, mixed-use communities centered around transit hubs to boost ridership and generate revenue through land leases or sales” could generate additional revenue ranging from $780 million to $1.1 billion, according to the study.
Possible industrial sites
In another finding, the report said certain NJ Transit properties “are ideal for warehousing and industrial uses, requiring large, flat parcels with good road access and utilities.” That could bring in an additional $150 million to $300 million, according to the agency.
And there’s a potential $40 million to $130 million revenue stream from selling advertising on digital displays, within station facilities, on vehicles and through naming rights arrangements, according to NJ Transit’s analysis.
Dan Kennedy, CEO of NAIOP, the Commercial Real Estate Development Association in New Jersey, said his trade group supports NJ Transit’s blueprint.
“Establishing this strategic direction, including a set of reasonable options for stations and surrounding assets to become catalysts for growth, is a major step forward,” Kennedy said in a statement.
NJ Transit provides more than 925,000 weekday trips on 263 bus routes, three light rail lines, 12 commuter rail lines and through Access Link paratransit service.