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Despite a drop in transit ridership across the nation, some developers are still doubling down on locating projects near MARTA stations in Atlanta. That is because the bet is on the future, not the present.
“We have tenants who talked to us recently who only looked at locations in the city that are within two blocks of a MARTA station,” Cousins Properties Managing Director Matt Mooney said during a panel discussion at Bisnow's Atlanta State of the Market event last week.
Even though mass transit adoption may be slow, Mooney said companies are making long-term commitments to buildings, and use MARTA access as a hedge.
“The sense of comfort, I think, and confidence they have knowing that they have MARTA as a relief valve is really, really important,” he said.
Earlier this year, the Federal Transit Administration revealed that mass transit ridership dropped nearly 6% from 2017, the fourth year of steady ridership declines. MARTA ridership dropped more than 3%, and is down even more from a decade ago. Transit systems in Austin, Boston, Charlotte, Cleveland, Miami, Milwaukee, Philadelphia, San Diego and Tampa all witnessed double-digit ridership declines as well, The Hill reported.
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Mill Creek Residential Managing Director Harvey Wadsworth said, at least in Atlanta, that decline in demand is easy to explain.
“It's because we make every other option so easy,” Wadsworth said. “We add lanes and we add parking spaces, and it's so convenient for everybody to drive to work. Why would anybody want to take a train?”
According to a recent Cushman & Wakefield report, 61% of all new office development in Metro Atlanta is within walking distance of a MARTA station. Those rents are also achieving a pricing premium, approaching $30/SF this year, some 25% higher than the average office rents throughout the region.
WeWork Southeast General Manager Bobby Condon said the coworking giant attempts to cluster locations near public transit regardless of the ridership data. The fact that the region is now investing in MARTA's expansion should help the system attract new riders in the future.
But at the same time, Condon said the price to park in Atlanta is a detriment to encourage transit ridership. Monthly parking rates in Atlanta average $105, among the cheapest rates in all the U.S., Curbed Atlanta reported.
“Atlanta is a very cheap place to park relative to any other major metro city,” he said.
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