When we think urban transportation infrastructure, typically we draw on a rich history of publically-funded iniatives. But new private sector-led models for financing “public” transportation are starting to change that narrative. We've already seen a huge success with Uber and Lyft, not to mention some serious promises made by the Tesla Master Plan Part Deux. Numerous smaller bike and car-sharing companies are showing up in more and more cities in the US, as well.
Mexico City’s The Avenida Chapultepec project is a less well-known example of innovating urban transport infrastructure financing. As detailed in the Forum’s white paper, A Field Guide to the Future of Mobility, the project gives a 40-year concession to a private trust that will be in charge of developing and operating the Chapultepec Cultural Corridor. This model is structured in such a way that private investment will fund the building and maintenance of the project, and receive income as with any normal business investment. Mexico City’s Government will also receive a small percentage of the yearly income, which is what makes this a truly different approach that purely private investment. Chapultepec Avenue, in the heart of Mexico City, will evolve to become a three-level linear park, incorporating public and private transportation, pedestrian and retail areas.
Certainly no complete solutions to major challenges with urban mass transportation including safety, quality and efficiency exist yet, but recent promising developments include Uber’s offering of now both individual and group transportation solutions in cities. Chariotm, a San Francisco-based company, offers a private network of bus rides for commuter routes based on a crowdfunding model. Mexico City public bus company Metrobus provides service operated by vehicles some of which are owned by the private company CISA. In Kansas City, Bridj offers a "microtransit" option with hail-ride van service. It offers low fares during rush hour traffic. In Singapore, to help ease the burden of congestion on roadways, electronic road pricing has been introduced. All vehicles have device fixed inside that is then digitally read by a meter along the roadside. Cars are charged different amounts depending on location and time, incentivizing the use of alternative routes and transit methods in the most direct way possible.
The examples above are a small sample of innovative efforts at financing next generation urban transit. One thing is clear, however: both investor appetite and public interest in financing for urban investments, including in infrastructure, exists. And the future isn't looking so bad after all.
