New Proposal to Spur Transit-Oriented Development and Bolster NJ TRANSIT

On Jun 14, 2024

The Murphy Administration unveiled a legislative proposal that would direct the New Jersey Economic Development Authority (NJEDA) to purchase up to $100 million in property from NJ TRANSIT to help expand commuter hubs across the state and meet a variety of critical needs. Under the proposal, the NJEDA would purchase a number of NJ TRANSIT properties, such as surface parking lots, and transform them into mixed-use, transit-oriented developments that will spur economic activity and increase walkability near transit lines while also creating a direct revenue source for the mass transit agency.

“Investing in transit-oriented development will revitalize commuter hubs, promote walkable neighborhoods, and improve overall affordability for working families in New Jersey, and potentially generate much-needed, new, affordable housing,” said Governor Murphy. “Together with our partners in the Legislature, we can transform communities around NJ TRANSIT rail stations, help spur economic activity across the state, and generate new revenue to support the operation of NJ TRANSIT, which has been forced to contend with a shift in ridership trends in the wake of the pandemic.”

Under the proposed legislation, which has already garnered legislative support, NJEDA, in partnership with NJ TRANSIT, would identify a portfolio of properties to be purchased by NJEDA who would then market the properties as a portfolio to be bid on for purchase or lease by developers, either as a whole or individually. To facilitate the purchase, the State would allocate a portion of the proposed Corporate Transit Fee’s first-year proceeds to fund the NJEDA’s purchase of the properties.

“Providing NJ TRANSIT with a long-term funding source is critical to ensure the agency can continue providing safe and reliable transportation options for New Jersey’s residents and commuters,” said Senator Patrick Diegnan. “I appreciate Governor Murphy, NJ TRANSIT, and the NJEDA working together to come up with a solution that will not only enhance NJ TRANSIT’s financial viability but will also support the revitalization of communities through transit-oriented development.”

“Mercer County is home to four NJ TRANSIT stations and the Trenton Light Rail. We understand the importance of quality transit to the economic success of our communities. Having the NJEDA manage the development of these valuable properties in cooperation with our towns will ensure that it’s a win-win for taxpayers, commuters, and smart planning,” said Mercer County Executive Dan Benson.

NJEDA Chief Executive Officer Tim Sullivan said, “The legislation proposed would empower the NJEDA to expand our efforts to revitalize neighborhoods and drive mixed-use property development. Transit-oriented real estate projects along NJ TRANSIT rail stops will advance the renaissance of neighborhoods and improve quality of life by creating new job opportunities and modern housing options for families and commuters.”

In addition to the upfront payment to NJ TRANSIT for the properties, the transit agency stands to reap many ancillary benefits from catalytic development in the vicinity of transit hubs, and potentially a recurring revenue stream if the properties are leased, rather than purchased, all of which would enhance its long-term financial viability.

“Governor Murphy’s plan to accelerate transit-oriented communities around NJ TRANSIT properties through immediate funding reinforces a forward-thinking approach to sustainable development,” said NJ TRANSIT President & CEO Kevin S. Corbett. “This funding will drive economic growth, increase walkability, and provide ongoing financial support for NJ TRANSIT.”

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