The presence of a transit line, the location of stations, and the demand factors that stimulate transit ridership all have a bearing on the nature and amount of transit-oriented development near stations. However, many other variables also play important roles in determining the amount of development to plan for. Two of the more significant factors are: (1) the state of the present and future regional economy, and (2) opportunities for real estate development in the specific corridor where the transit station is located.
All transit-oriented development projects are different, reflecting the specific location, land value, nearby development pattern, local demographics, history of the area, and related factors. Public policy can also have a powerful impact on the nature, magnitude, and timing of transit-oriented developments. Designation of urban growth areas, implementation of regional and local plans, aggressive zoning, and establishing rigorous standards for density and design in transit corridors are all measures that can support or, if not done properly, detract from development at stations.
Ground Rules for Evaluating Market Potential
A wide range of factors determines the market for transit-oriented development. Each station location will have different influences and will respond to different strategies. Below are some common "ground rules" for better understanding these influences on development potential at transit stations. The ground rules provide direction for assessing development opportunities and constraints around transit stations.
- Define Transit-Oriented Development Objectives
- Understand Responsibilities for Transit-Oriented Development
- Determine Realistic Expectations for Each Station Area
- Understand that Developers Make Real Estate Decisions
- Demonstrate Public Commitment to Private Investment
- Consider Location as Primary Determinant of Market Potential
Market Research and Analysis
Market research for transit-oriented development involves analyzing market and economic conditions at various geographic levels. The objective of the market analysis is to look at the state of the economy and real estate market at the regional level and work down to the site level. There are three key levels to focus on in the process for conducting a market analysis of development potential at a transit station area. The different levels require the skills of a number of people as well as a variety of data sources.
- The first level is the regional market analysis. This broad scale analysis is conducted to determine "the big picture" economic and demographic context for transit-oriented development in general. This level of analysis provides an understanding of the housing and job growth environment in which transit-oriented developments do business and compete for market share.
- The second level is the corridor-segment market analysis, which defines the development potential of specific segments of the corridor. In urban regions it may be typical for particular types of land uses to concentrate in a particular sector or a region, or along certain corridors. For example, in the Seattle area, there is a significant concentration of industrial and commercial development in the Duwamish River corridor. Any transit corridor in this sector would have to plan for continued commercial and industrial uses.
- The final level is the market analysis for the station area and specific sites. This analysis is the more detailed because it deals with a specific group of properties. It is at this level that careful consideration is given to specific land use relationships and the opportunities for the desired development projects to support transit. The detailed analysis of the station area and individual sites is probably best performed by local government staff working with private developers and neighborhood interests.
Market analysis for transit-oriented development involves understanding multiple levels of the economy and the real estate market. A comprehensive market analysis process involves the review and assessment of market factors at various levels within the regional market. Such an analysis is not a means to an end. Rather, it provides a general idea of the types of development that could locate and be successful within the station area. The information gathered from a market analysis should be incorporated into an action plan or market strategy for promoting transit-oriented development.
Additional Resources
Beyond the Field of Dreams: Light Rail and Growth Management in Portland, Tri-Met, Tri-County Metropolitan Transportation District of Oregon, Portland, Oregon, September 1996.
Commuter Rail: Serving America's Emerging Suburban/Urban Economy, The Carmen Group, Inc. for American Public Transit Association, Washington, D.C., September 1997.
Dallas Area Rapid Transit Impact Study: A Framework for Assessing Land Use and Development Impacts, Patrick J. Coleman, Mark A Euritt, and C. Michael Walton, Center for Transportation Research, University of Texas, Austin, Texas, May 1993.
Impacts of the "Coaster" on Cities in North San Diego County, John S. Dewhirst, Snohomish County Public Works, Everett, Washington, December 1997.
"Impacts of Commuter Rail in Toronto Region," Sarah Stewart Wells and Bruce G. Hutchinson, Journal of Transportation Engineering, July/August 1996.
The Impact of Rail Transit on Economic Development and Land Use: Case Studies, Parsons Brinckerhoff/Kaiser Engineers Team for Metro Regional Transit Project, Seattle, Washington, September 1991.
Land market Impacts of Urban Rail Transit and Joint Development: An Empirical Study of Rail Transit in Washington, D.C. and Atlanta, Robert Cervero, University of California Transportation Center, University of California, Berkeley, California, 1992.
Local Economic Impacts in Commuter Rail Station Areas: Recommendation for Reinforcing the Commuter/Merchant Interface and Appendices, Camiros, Ltd., Valerie S. Kretchmer Associates, Inc., and Metra, Chicago, Illinois, December 1994.
The Market for Transit-Oriented Development: Proceedings of a Workshop Presented by the Regional Transit Authority of Northeast Illinois co-sponsored by the Chicago chapter of the Urban Land Institute, Regional Transit Authority of Northeast Illinois, Chicago, Illinois, November 13, 1995.