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To Reverse Ridership Declines, Metro Pins Hopes On Development Around Stations

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Development near the Wiehle-Reston East station on the Silver Line is likely to bring new commuters to Metro, helping reverse a longstanding decline in ridership.
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Development near the Wiehle-Reston East station on the Silver Line is likely to bring new commuters to Metro, helping reverse a longstanding decline in ridership.

Will future real estate development guarantee a return of Metro’s lost riders?

The problems plaguing the second-busiest subway system in America are well-documented: an economic downturn and federal budget sequestration led to fewer rides; the reduction of a pre-tax transit benefit, provided by more than 5,000 employers, from $255 to $130 per month also contributed to the decline; and for the first time last year the transit authority admitted that consistently unreliable service — some could describe it as terrible — has alienated commuters.

Since its peak in 2008, when Metrorail recorded 750,000 trips on the average weekday, ridership is down 5 percent.

But Metro’s leaders believe riders will return, pointing to development either underway or planned within close proximity — defined as a half-mile walking distance — of rail stations across the region. Moreover, while overall ridership is down, more people are using the core stations in downtown D.C., as any regular rider can attest during a typical rush hour of packed platforms and crowded trains.

To help Metro determine how to set fares, researchers at the University of Maryland developed a new ridership model that analyzes how the location of jobs and homes will impact the system’s already strained capacity.

Is the price right?

Even before new general manager Paul Wiedefeld, whose first day was Nov. 30, vowed not to raise fares come July 1, key members of WMATA’s board of directors, led by D.C. Council member Jack Evans (D-Ward 2), promised the same.

After a regrettable year that began with the death of a passenger during the L’Enfant Plaza smoke fiasco and continued with chronic breakdowns and delays, Metro leaders decided against trying to push through a fare hike, even though the operating budget was projected to have a large deficit partly due to sinking revenues.

But if raising fares would increase revenues somewhat, it could also further anger commuters.

The study by the University of Maryland’s National Center for Smart Growth suggests a 10 percent increase in fares could result in a 5 percent drop in ridership, and vice versa.

“Information on the influence of transit fares is critical not only for managing transit ridership and station congestion, but also for maximizing revenues through fare-box recovery, especially in the face of rising costs and growing demand for greater service levels,” the study says.

“It is critically important that we price things correctly,” says Gerrit Knapp, the center’s director and one of the study’s three authors. “If you price it too high, no one rides it. If you price it too low, it’s overcrowded. It is like any pricing question. You have to get the price just right.”

The research will help Metro determine when and where to change its fare structure, Knapp says. For instance, commuters could be charged higher (or lower) fares for entering or exiting the busiest stations during rush hour than for lightly used stations.

Study says higher fares = fewer riders; more jobs, homes = more riders

Development patterns will determine which stations see the largest ridership gains. Every ten households located with a half-mile walk of a station will add two riders during morning rush hour; every ten jobs within a half-mile walk will lead to eight riders using Metrorail to get to them, according to the study.

“Both jobs and households in the station area are key to fostering more ridership,” says Knapp, referring to the importance of transit-oriented development (TOD).

In a post on its planning blog, Metro says transit-oriented development contributed to ridership gains at NoMa, Columbia Heights, and Navy Yard-Ballpark even as system-wide ridership declined.

More important, however, Metro planners are weighing the impact alternative modes of travel are having on short rail trips. When a cheap substitute is available — such as ride-hailing, walking and biking — raising rail fares could drive down ridership and offset any revenue gains.

“In contrast, it is more difficult to find alternative modes of travel that are efficient and affordable for long-distance trips,” the Metro planning blog says. “It is likely that the high cost of parking in the city center plus traffic congestion on freeways and major arterials combine to make it difficult for people to switch from Metrorail to a private car.”

“Estimates of fare elasticity — customers’ sensitivity to the price of transit trips — vary little between peak and off peak periods, but… our estimates of fare elasticity vary by distance traveled,” the blog says.

The Foggy Bottom example

If you could go back in time 10 or 15 years and take Metrorail to Foggy Bottom, you would hardly recognize the neighborhood whose main draw was The George Washington University, to this day one of the largest property owners in the neighborhood.

“This was kind of a slum,” says Christopher Leinberger, the chair of the Center for Real Estate & Urban Analysis at GWU, in an interview at the corner of 23rd and I Streets Northwest.

“Behind me was a surface parking lot. It was a very nice surface parking lot, but it was Deadsville,” says Leinberger, a widely regarded expert on transit-oriented development. “We had the hospital and the university, but that was it.”

Today, the university and associated hospital are surrounded by new apartments, grocery stores, restaurants, shops, office buildings, and the energy of a downtown, a walkable urban place. The development resulted in more riders using the Foggy Bottom Metro station, and vice versa.

In the mid-1990s, about 16,000 people entered the station on the average weekday. Today, close to 22,000 boardings are recorded daily.

“This is now downtown Foggy Bottom,” says Leinberger. “Remember, the guiding rule is transportation drives development.”

What happened there will happen elsewhere as real estate projects are brought to completion, he says.

“Not all, but many people at Metro — and at all transit systems throughout the country — believe the goal is to move people,” says Leinberger. “That’s the wrong goal. The goal of Metro should be economic development at the stations. The means is by moving people.”

Increasing transit-oriented development at underutilized rail stations along the Green Line in Prince George’s County could serve two purposes. First, Metro will be able to run fuller trains out of the city in the morning because people will be traveling to jobs located close to those stations. Today, trains leaving the city during morning rush hour are often empty.

Second, developing those stations could produce social equity, he says.

“This bridges the rich and primarily white west side of the region with the poorer and generally black and Hispanic east side. From a social equity standpoint, this is the most important thing we can do. Eight percent of future real estate development will take place around Metrorail stations, occupying about 6 percent to 7 percent of the region’s land mass,” Leinberger says.

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