Faced with busted docks, faulty software, and a dearth of profit from 24-hour and 7-day users, Citi Bike, a success in terms of popularity, has been a failure where it counts. Its financial namesake won't grope between the couch cushions to support it, and De Blasio has declined to allot municipal funds for it either. So what happens to public projects that everyone wants and needs but refuses to fund? Private real estate to the rescue!
Capital reports that REQX Ventures, an investment firm comprised of people affiliated with Related Companies and Equinox gyms, has agreed to buy a 51% share of Alta Bike Share, the company that operates Citi Bike and other bikeshare operations across North America and Australia.
So what's the catch?
In New York City, where bike-share users now pay $95 for an annual membership and $9.95 for a day pass, REQX would have the freedom to raise rates without city approval, though the contract might include some sort of percent-per-year cap on the size of those hikes. Public housing residents and some credit union members would retain access to a discounted rate of $60 per year.
REQX would install new software and use the money derived from rate hikes to stabilize the system's finances, and also perhaps expand it, said the sources.
The City and REQX declined comment, but Paul Steeley White, the executive director of Transportation Alternatives, told Capital he hopes the deal goes through quickly.
"The system needs to be better capitalized and it does need an infusion of capital to replace the software system, bring their operations to an acceptable state and restore confidence in the system," White said.
In light of a recent photo we ran of a Citi Bike nest, this news reminds us of what Ian Malcolm said in that seminal 1993 documentary: "Life, uh, finds a way."