And yet when the region’s savviest and deep-pocketed real estate developers place their bets, they are still scrambling for land near Metro stations.
More than ever, proximity to Metro stations remains the top indicator of value for D.C. real estate, according to a report being released this week by the Washington D.C. Economic Partnership. Over the next 15 years, the group projects that 78 percent of everything that gets built in the city — offices, apartments, condos, shopping centers and more — will be within a half-mile of a Metro station.
By 2030, the District is projected to have a population north of 800,000, a 34 percent increase from 2010.
“Where will these people work, dine, shop, socialize and live?” the report asks. “For the vast majority the answer will be near a Metrorail station.”
The report includes data on 388 projects compiled by the real estate services firm CBRE, along with an interactive map showing many of the projects around the stations. Here’s a static version:
Three stops in particular are expected to add a lion’s share of the growth: NoMa-Gallaudet U, Union Station and Navy Yard-Ballpark.
NoMa is positioned to add a series of office buildings as well as retail and apartments around Union Market. The tracks behind Union Station are subject of one of the largest development projects in the region, Burnham Place.
The area around Nationals Park already had a staggering amount of work going on as of August: nine apartment buildings featuring 2,850 units, 160,690 square feet of retail and three hotels featuring 533 rooms.
Two stations east of the Anacostia River are also among the top development sites, Congress Heights and Anacostia, with more than 10 million square feet of development combined expected to be completed or underway by 2030.
For riders who are tired of delays, outages and safety concerns, Metro may not seem like the lure it once was.
Despite the problems with trains and stations, there are frequent threats of fare increases. Officials from Maryland and Virginia have been reluctant to provide the system more money.
Meanwhile, gas prices are down and more commuters, visitors and travelers are using car-sharing services like Uber and riding bikes. Aside from taxis, a few years ago Metro was nearly the only game in town when it came to avoiding traffic and parking; now there are an assortment of other options.
Perhaps it’s no surprise that ridership has begun to decline. Metro’s rail ridership had some positive months earlier this year, but since March it has been shrinking when compared with the levels last year. Bus ridership has fallen off more dramatically.
Given the state of the Metro trains and tunnels below ground, will all the projections of Metro-oriented development upstairs really come to fruition?
“In spite of the current challenges that Metro has, people still see the value of mass transportation and the Metro system in D.C. and I think development is going to go along those lines,” said Keith Sellars, president and chief of the economic partnership.
Sellars said that with Metro finally close to hiring a permanent general manager and officials in D.C., Virginia and Maryland raising concerns about the system, he thinks Metro’s downward spiral will be short-lived compared with the long-term investments that developers typically make.
Over long-term, access to the stations, Sellars argued, would remain critical even for people who commute by other means. “Even if they don’t use Metro daily, they want that access to Metro,” he said.
Indeed, despite the operational problems, Metro officials continue to project long-term ridership growth in large part because of all the development expected around its stations.
Some of the long-term growth is projected at stations outside the District, and that can be of particular financial importance to the Metro system. When companies locate offices near further-out Metro stations, it encourages reverse commuting for residents in D.C. and close-in neighborhoods. That in turn allows Metro to fill some of the cars it runs out of the District in the morning and back into town in the evening.
It’s not just the District; suburban leaders are pushing development near Metro stations and investors are following. Under County Executive Rushern L. Baker III for instance, Prince George’s County officials have been looking to jump start projects at stops including New Carrollton, Largo, Prince George’s Plaza and Greenbelt — a possible landing place for the FBI headquarters.
Metro Planning Director Shyam Kannan said the long lead time that it requires to acquire, plan, finance and construct something in a competitive, urban environment like Washington gives the transit agency time to sort out its issues.
“The cranes are in the ground. You’re not going to pull the cranes out of the ground,” Kannan said. “We’ve got at least five to 10 years of stuff coming out of the ground near Metro stations. And that means revenue for us.”
He acknowledged however that even long-term bets on Metro could waiver if the system can’t solve its day-to-day issues.
“Assuming again that we can solve our short-term operational challenges, which I am sure we will, and if we can recapture some of those riders who are enjoying $2 gas, which isn’t likely to last, then that will help as well,” he said.
Follow Jonathan O’Connell on Twitter: @oconnellpostbiz