There Goes the Neighborhood? The Trickle-Down Effect of High Ride-Hailing Prices

After years of operating at unsustainably low costs, ride-hailing companies Uber and Lyft are hiking prices, making some neighborhoods less accessible than they once were. “A dwindling supply of drivers, rising interest rates and the decline of cash infusions from patient venture capitalists has squeezed those apps, leading outlets like Slate to declare in May that ‘The Decade of Cheap Rides Is Over,’” writes Jacob Wallace in Bisnow. 

Now, businesses in neighborhoods popular with ride-hailing customers are noticing the impact as consumers make more judicious decisions about their transportation habits. “These changing behaviors have meant businesses in those neighborhoods are struggling to bring their customers back, and in some cases closures are forcing landlords to contend with vacant spaces.” Meanwhile, public transit agencies, rather than introduce service in areas where Uber and Lyft were filling the gap, focused their resources on boosting service frequency and reliability on popular lines, leaving transit-poor neighborhoods to fall by the wayside.

The article profiles some Washington, D.C. businesses that are struggling or have closed in the wake of rising transportation costs and reduced foot traffic. Some are considering a move to more transit-oriented neighborhoods, where real estate may cost more, signaling a potential return of these newly-gentrifying areas to their more industrial pasts.