Hong Kong’s subway lines may not compare to New York’s in length, but they’re more profitable by a country mile.
The Mass Transit Railway (MTR) Corporation raked in almost HKD40 billion in revenue last year for a profit of HKD15 billion – something that is almost unheard of for urban rail networks operators.
A large percentage of that profit can be attributed to the property development aspect of the corporation. Aside from all retail spaces within the stations, the MTR also owns all the property above stations, such as the IFC mall, for example.
CNN Money explains that the Hong Kong government, a majority shareholder in the MTR, provides free land to the company, which then develops the areas into cash-making machines such as shopping malls, of which MTR owns a casual 13.
In 2014, rents at the malls reportedly increased by an average of 14 percent. Nice.
As a property developer, the MTR Corp. is clearly doing very well for itself. But that’s not to say that its urban transportation arm is simply a side project.
Hong Kong’s 174 kilometres of subway track reaches all corners of the city, ferrying five million passengers a day with a just-short-of-perfect on-time arrival rate of 99.9 percent.
Good enough, we say… unless we’re at Admiralty at 6:30pm on a Friday.
But the figure that’s most impressive is perhaps the “farebox recovery ratio”, which measures the fraction of operating expenses paid by passenger fares.
Hong Kong boasts a ratio of 185 percent, the highest in the world. Using most recent data according to the Atlantic and the New Yorker, Singapore’s system comes closest at 125 percent, while New York is way behind with a paltry 76.1 percent.
Not content with just being Hong Kong’s overlord, however, the MTR Corp. also operates single subway lines in Shenzhen, Hangzhou, Beijing, two London Underground lines, and entire subway systems in Stockholm and Melbourne.
Looks like the MTR is taking over the world, one subway system at a time.
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