Bloomberg Markets reports that the MTA raised $1.06 billion backed by lease revenue from the Hudson Yards site. This is the first time the MTA has issued bonds backed by real estate, typically the agency bonds are backed by fare-box revenue and bridge and tunnel fees.

The article cites the coupons at 5% for this new issue (maturing in 30, 35, and 40 years), “at yields of 1.88 percent, 2.38 percent and 2.63 percent, respectively”. It seems to me that given the historically low interest rate environment we are in, and the MTA’s never ending list of much needed capital improvements, now would generally be a good time to massively upgrade its infrastructure.

One of the longer-term concerns for real estate in New York is that a surge of development, in recent years and in the near future, will overtax mass transit. That could be a drag on future population growth putting a lid on demand for real estate.

New York Mass Transit Stats – Metro population approx. 20.2 million

  • New York average weekday subway ridership in 2015: 5,650,610
  • Annual ridership 2015: 1,762,565,419
  • Average weekday bus ridership: 2,070,386
  • Annual ridership 2015: 650,681,784
  • Source: MTA

Tokyo – Metro population approx. 37.8 million

  • Estimated average daily train ridership in the metro area: 40 million at the turnstile
  • Estimated annual ridership: 14.6 billion
  • Unlike NYC, Tokyo’s rail system is a network of multiple private rail lines. When NYC riders change trains inside a station they are not counted twice, but in Tokyo that may count twice.
  • Source: Wikipedia

Other Cities Daily or Peak Daily Rail Ridership (from

  • Beijing: 10 million daily
  • Seoul: 7 million daily
  • Shanghai: 9.4 million peak
  • Moscow: 9.3 million peak
  • Guangzhou: 7.9 million peak