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Why No One Drives to Work in Hong Kong

October 21, 2014 By Jeff Fong

Need to get 4 million people to the office every day? Hong Kong has you covered.

The Mass Transit Railway (MTR) is a rail system in the city of Hong Kong, currently managed by the Mass Transit Railway Corporation Limited (MTRL). The system opened in 1979 and now operates over 135 miles of track as well as more than 152 stations in Hong Kong. The average trip costs somewhere between .50 cents and $3 USD, and the system makes back 186% of its operational costs on fares alone.

Hong Kong Metro

Much of the system’s success can be attributed to urban density. Denser development means people live, work, and play in smaller geographic areas, meaning that more people are travelling between a fewer number of points. This is a huge plus for a fixed-route system like a railway. The MTR, however, hasn’t been a passive beneficiary of its environment.

The MTR owns real estate around each station in the system and integrates rail and property planning so that the development of one supports the development of the other.

Construction around each MTR station is incredibly dense, so it can put as many potential riders as close to a station as possible. Over 41% of the population in Hong Kong (2.78 million people) lives within a half-mile of a station. Additionally, the company’s real estate strategy emphasizes walkability; some residents of MTR owned properties can walk from their homes to a station entrance without ever even going outdoors. Clustering potential riders around each station–and making sure passengers have an easy time getting there–helps support high levels of ridership.

While fares cover the costs of operations, it’s really property development that pays for maintenance and expansion. The rail line, in turn, increases the property values of parcels adjacent to each station. This augments the land rents which are siphoned off to cover capital costs.

Ultimately, building effective mass transit is all about embedding the system within a friendly urban environment. High-density, mixed-use development is a must, but so is the ability to leverage land values as a means to finance capital investment and outlays.

Part 1 of 2 covering the policies and institutions behind mass transit in Hong Kong

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Filed Under: infrastructure, Logistics & Transportation, Transportation Tagged With: Hong Kong, mass transit, MTR, transit-oriented development

About Jeff Fong

Jeff graduated from San Jose State University where he studied Politics and Economics. After college he spent time working in financial services before moving to on-demand transportation startup Lyft. He now works at the consumer logistics platform Postmates where he leads the company’s team dedicated to risk mitigation.

Along the way, Jeff has become increasingly interested in urban economics and periodically contributes to housing reform efforts in the Bay Area through the region’s various YIMBY organizations, including publishing commentary via Tech for Housing.

Comments

  1. Sandro Wolfe says

    October 22, 2014 at 7:31 am

    a very interesting article ! There is certainly a new problem evolving in metropolis transportation, parking and space for everyone… but also interesting to see that new inventions are being created to face and avoid these issues. Have you heard about this robot called ‘Ray’ that might handle all of our parking in the future : http://smart-magazine.com/space/go-fetch-the-car-ray/

  2. makin deod says

    February 18, 2015 at 12:55 pm

    Great Job , This article was truely a work of hardwork and rigorous potential, i must appreciate it. thanks for sharing such posts.Battlefield hardline PC Download

Trackbacks

  1. BART, Josefowitz, and Mass Transit in the Bay says:
    November 10, 2014 at 12:17 pm

    […] level only as opposed to multi-level parking structures). This sounded a lot like Hong Kong’s integrated rail-property development approach which has proven to be an unqualified success, so my interest was definitely […]

  2. Why Hong Kong's Metro Is Such A Success | CleanTechnica says:
    November 17, 2014 at 6:35 am

    […] Urbanism, in “Why No One Drives to Work in Hong Kong,” notes: “The MTR owns real estate around each station in the system and integrates […]

  3. Porque Nadie Conduce al Trabajo en Hong Kong? | SalvoLomas says:
    February 10, 2015 at 11:02 am

    […] vía Why No One Drives to Work in Hong Kong. […]

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