July 24 (Bloomberg) -- The operator of New York City’s bike-sharing program is in talks with an affiliate of real estate developer Related Cos. for an investment of tens of millions of dollars to fuel an expansion, according to a person with knowledge of the negotiations.
A deal could be announced in as soon as two weeks, said the person, who asked not to be identified because the talks are private. The Wall Street Journal reported the deal last night on its website.
Under the plan, Citi Bike’s operators would increase the number of bicycles to 12,000 from 6,200 and bring them into Queens, upper Manhattan and untapped neighborhoods in Brooklyn, the person said. City officials have asked Alta Bicycle Share Inc., the Portland, Oregon-based company that operates Citi Bike, to raise money to expand the program. More than 100,000 annual memberships have been sold for $95 annually.
REQX Ventures, an affiliate of Related, would get a controlling stake in Alta, which also runs bike-share and rental programs in Boston and San Francisco, the person said. The deal would allow Alta to raise the price of annual memberships to $140 or more.
Before a deal is announced, Alta has to revise its operating agreement with the city Department of Transportation, the person said.
Related is the developer of the Time Warner Center at Columbus Circle and a partner in the $20 billion Hudson Yards project, a 26-acre (11-hectare) district of offices, apartments, shops and parks on Manhattan’s far west side.
Joanna Rose, a spokeswoman for New York-based Related, and Mike Pagnozzi, Alta’s chief managing officer, declined to comment. Wiley Norvell, a city spokesman, said New York is committed to making Citi Bike more reliable and accessible to neighborhoods across the city. He declined to comment on Related’s plans.
“Citi Bike has become part of our public transportation system, and there is a lot riding on its success,” Norvell said in an e-mailed statement. “We owe it to New Yorkers and to riders to get this right, and make sure we put the system on solid footing for the long-term.”
To contact the reporter on this story: Martin Z. Braun in New York at firstname.lastname@example.org
To contact the editors responsible for this story: Stephen Merelman at email@example.com Mark Schoifet, Alan Goldstein