With transport agency budgets under extreme stress, it would seem wise to take a careful look at what opportunities there are to increase non Fairbox revenue. Typically, think about five core opportunities to drive non Fairbox revenue. Real estate development. Transit agencies can partner with real estate developers to incorporate mixed use developments into railway infrastructure, typically on or around stations.
Value capture, governments have been able to levy specific rates on businesses that benefit from pieces of public transport infrastructure. Share of wallet products, some transit operators have introduced products that increase share of customer wallet. For example, travel cards that can be used as regular debit cards, premium travel products and tourism partnerships. Station or transit hub concessions.
Transit agencies capture rent and concession fees from concessionaires within stations or transit hubs. And finally, infrastructure monetisation. Railways, particularly tunnels, can be used as routes for other infrastructure through cities. For example, electricity, gas or internet connections.
Governments can monetise these connections via access rents. We have completed a review of these opportunities and their transferability to the Australian market against four criteria: Revenue potential, implementation difficulty, level of public acceptance, long term viability. Our conclusion is that value capture remains the most attractive means of driving non farebox revenue. To a lesser extent, opportunities exist to drive concession revenues at our major transit hubs and stations, particularly in the post pandemic environment where customer needs have changed.
