One story has been prevalent in the dozen or so years I’ve been covering business in this state: Multifamily and mixed-use developments by train stations are the easiest bet for success in the commercial real estate industry.
It makes sense: Build where the people are — and want to be.
It’s one of the reasons behind the innovative and transformative project that Hackensack Meridian Health is building at Metropark Station in Iselin — one that will feature not only medical services, but office, retail and residential offerings.
Here’s what hasn’t made sense: Why New Jersey Transit hasn’t taken advantage of the prime real estate holdings it has at so many stations.
It is now.
Last week, NJ Transit CEO Kris Kolluri, joined by local and state officials and other stakeholders at an event at Metropark Station, unveiled the LAND Plan: Leveraging Assets for Non-farebox Dollars.
They said it could provide a roadmap for up to $1.9 billion in potential non-farebox revenue over the next 30 years.
From transit-oriented development to retail concessions to industrial hubs and advertising, NJ Transit officials said the plan offers a unique opportunity to generate essential funding by leveraging its underutilized assets for development, as well as enhancing its customer experience with retail offerings and advertising.
The plan, which aims to unlock value from NJ Transit’s 8,000-acre real estate portfolio, could add up to $14 billion in economic impact to New Jersey, up to an additional $1.6 billion in municipal revenues, and create up to 50,000 jobs and up to 20,000 new housing units.
These are big wins.
The best part: They come from a mandate. This is not the state forcing someone to solve NJ Transit’s revenue issues, whether they have it in their area or not (see South Jersey companies and the Corporate Transit Fee).
This is a win-win for all — but a win-win that will only happen with full buy-in, Kolluri said.
“The plan’s proposed actions are presented merely as options for consideration — not mandates — to support the plan’s full revenue potential,” he said. “I have a deep respect for home rule in New Jersey and the legislative process, and look forward to working collaboratively with the Legislature, municipalities and elected officials across the state.”
Jose Lozano, the chief growth officer at HMH and the key driver of its project at Metropark, said the project represents what happens when all sides work together.
“At Hackensack Meridian Health, we understand the vital role public transportation plays in our communities and believe in the possibilities that emerge when the public and private sectors work together,” he said. “We are proud of our partnership with NJ Transit in creating an exceptional new facility at Metropark, expanding access and providing world class services for New Jerseyans.
“Our project is a perfect example of the greater potential unlocked through NJ Transit’s impactful real estate plan. We look forward to continuing our partnership in the coming years.”
NAIOP New Jersey CEO Dan Kennedy said his group is ready to play its part.
“We support and stand ready to assist NJ Transit leadership as it implements this blueprint to leverage its existing assets,” he said. “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.
“We believe strongly that the private sector can be a reliable partner in improving transit-oriented destinations where people, business, and innovation come together to thrive all while improving the user experience for all.”
Sills Cummis attorney Ted Zangari, whose redevelopment law practice group has been involved in a few of the transit-oriented development projects in partnership with NJ Transit thus far, including Hoboken and Wood-Ridge, said the idea is a no-brainer.
“Unlocking the development potential around and above transit hubs and nodes is the closest thing to a smart growth economic development trifecta: jobs, ratables and housing where people want to live, work and play,” he said.
