A thought about the Metro

I think properties near Metro stations are generally undervalued. Why? After all, even if you live near a station, it’s relatively unlikely that you will work near one, too. That fact dramatically limits the Metro’s value to most people in the city.

But the trend for Metro is positive: More lines and more stops over the next, say, thirty years.

And one of the most interesting things about any network is that, as you add nodes to a network, the value of the network increases exponentially, not linearly.

What does that mean, in plain English? When Metro adds a stop in any area, two different calculations change.

  1. All of the people within walking distance of the new stop consider whether they can now reach their workplaces, wherever they are, by train. Those that can strongly consider ditching the car for the train.
  2. All of the people who work near the new stop consider whether they can now reach their home by train. Those that can also consider ditching the car.

Not everyone will make the switch, but many will, because the cost of a Metro pass is so much lower than the cost of maintaining a car.

So, more stops = more riders.

I can’t think of a single other amenity the value of which is guaranteed to grow exponentially for at least a generation, with zero incremental expenditure by the property owner.