LESSONS LEARNED FROM TOD PROJECTS

Gregg Logan, Melina Duggal | November 2010

DEFINING TOD

1

Pictured: Lindbergh MARTA Station and TOD, Atlanta Georgia RCLCO worked with the City of Atlanta, MARTA, and BellSouth on the development

  Mixed–use community (e.g. residential, retail, office, civic, park) within +/- 2000-ft walk to transit stop

  Walkable environment   Convenient for multimodal travel for residents and employees

Lindbergh City Center TOD: 30-acre mixed-use development in Atlanta; transit components include intermodal transfers to bus, taxi, and kiss ride; two bus facilities, MARTA station modifications, transit police facility, parking facilities. A functional urban community that promotes the use of mass transit. Phase One 270,000 SF / 160 units of condominiums and apartments, 120,000 SF / 300 room hotel, 1,200,000 SF of office space and 330,000 SF of retail space. Pedestrian and transportation connections and the integration of public greenspace. A place to live, work, shop and be entertained in a pedestrian-scaled, urban environment.

2 2

PROPERTY VALUES NEW TRANSIT DRIVES INVESTMENT, INCREASES PROPERTY VALUES

Original cost:$54M

Catalyzed Investment: $3.8B

Multiplier: 74X

SOURCE: Reconnecting America

3 3

PROPERTY VALUES VALUE CURVE FROM TRANSIT DEVELOPMENT

Research shows average value increases of between 5% and 45% and more.

4

TOD DEVELOPMENT CHALLENGES

•  Multiple property owners with different interests •  Difficult and costly property acquisition / assembly •  Cost / integration of structured parking •  Often substantial infrastructure requirements •  Environmental site issues need cleanup •  Local opposition to density

Long-term, complicated, often controversial requires collaboration between public and private sector

5

DEFINING THE OPPORTUNITY MARKET, PRODUCTS, FINANCIAL, FISCAL, ECONOMIC

•  Land Area: How much land, what are the opportunities and constraints (topo, access, environmental, improvements, …)?

•  Market Demand: Based on economic/demographic outlook, competitive picture, what is the unmet demand for space (residential, retail, office, hospitality, industrial, …)?

•  Financial Feasibility: How do projected revenues stack up against development costs, what subsidies are required, what impact can be expected on land values relative to current values?

•  Fiscal and Economic Impact: Considering higher tax revenues but also higher cost of public services, what is the net fiscal impact (benefit) over the next 10, 20, 30 years relative to what’s there? How many jobs will be created?

•  Program and Phasing: How do market demand and financial feasibility translate into a logical program and phasing plan for the next 10, 20, 30 years?

6

CASE STUDY EXPERIENCE IN CHARLOTTE

•  Projects: •  Provision of Market and Economic Guidance into Allocations of Future Growth in

Mecklenburg County, North Carolina for the Charlotte Department of Transportation •  Long-term transportation planning, helping Charlotte DOT) was understand the share of future

growth that could be shifted over the next 25 years, via proactive policies, to locations more easily served by mass transportation corridors, and existing transportation infrastructure. December 2004.

•  Market and Build-out Analysis for the Third and Fourth Ward for the Charlotte-Mecklenburg Planning Commission and Charlotte Area Transit System (CATS)

•  Provided market guidance relative to the Third and Fourth Ward neighborhoods in context of the planned Multi-Modal Station (MMS) between these two urban neighborhoods and the need to plan appropriately around the station. December 2004.

•  Charlotte North Corridor TOD Station Analysis for The Charlotte-Mecklenburg Planning Commission and CATS

•  Provided market guidance into future development potential at each station area along the planned North Corridor Light Rail Transit line.

•  Assisted in selections of alternative station(s) or corridor alignment(s) opportunities as well as assisted planners and other government entities in planning long-term for development around each station location. January 2006.

7

DEFINING THE OPPORTUNITY WHAT HAVE WE LEARNED

•  All TODs are not the same

•  Market potential around stations is still market-driven •  E.g. retail still needs good auto access •  More successful in the “favored” corridor of growth •  Certain land uses are more compatible with TOD than others

•  However, TOD can change demographic and market patterns

•  Pricing premiums for office and residential uses •  Reduced parking – cost saving possibilities •  High public sector expectations versus difficulty to serve all target markets

•  Station design and integration

•  Policies are not always in place that would allow for TOD-style development

8

CHARLOTTE EXAMPLE

SOURCE: CATS

9

CHARLOTTE EXAMPLE

SOURCE: CATS

10

CHARLOTTE EXAMPLE

SOURCE: CATS

11

IMPLEMENTING THE PLAN – NOT FOR THE INEXPERIENCED

Public Partner:

•  Resolve land assembly •  Acquire/contribute land •  Get sites development ready •  Secure infrastructure funding

  TIF (property, sales, hotel tax)   CFD/BID   Parking revenue bonds   Government leases

•  Accelerated entitlement – “greentaping” •  Continued public involvement •  Invest in placemaking: landscaping,

lighting, signage •  Manage partnerships with private

sector •  Assist with property management •  Programming

Private Partner: •  Apply real estate experience •  Take development risk •  Fund development •  Construct buildings •  Lease/sell space •  Operate properties

12

IMPACT OF TRANSIT COULD HAVE MORE IMPACT ON ENERGY SAVINGS THAN “GREEN BUILDING”

21%

38%

7%

31%

24%

34%

10%

39%

49%

45%

63%

161%

325%

92%

112%

124%

133%

137%

158%

165%

206%

219%

251%

273%

290%

431%

973%

245%

0% 200% 400% 600% 800% 1000% 1200%

Cleveland

Chicago

Buffalo

New York

Boston

Detroit

PittsburghSt. Louis

Cincinnati

Philadelphia

Baltimore

Washington

Atlanta

34 Metro Areas

Urbanized Area GrowthPop. Growth

Growth in Land Consumption Exceeds Population Growth in Metro Areas with Population > 1 million 1950-1990

SOURCE: U.S. Environmental Protection Agency (EPA) report Our Built and Natural Environments: A Technical Review of the Interactions Between Land Use, Transportation, and Environmental Quality

13

RCLCO NATIONAL TOD EXPERIENCE

Project CHARLOTTE LRT STATION AREA ANALYSES – FOUR CORRIDORS Charlotte, North Carolina

• Identified development potential for each station area along four corridors planned for LRT, BRT, and potential commuter rail

• Evaluated land use intensities and potential development timing for station areas

HOUSTON INTERMODAL TRANSIT FACILITY Houston, Texas • Worked with the Metropolitan Transit Authority of Harris County

(Houston Metro) and Ehrenkrantz, Eckstut & Kuhn Architects (EEK)

• Envisioned and tested the market and financial feasibility of the development program for the future hub of Houston transit

• Helped create a deal structure that would be beneficial to all, taking into account available public financing mechanisms and the qualitative needs of each of the parties

14

RCLCO NATIONAL TOD EXPERIENCE Project CITY OF ATLANTA AND THE METROPOLITAN ATLANTA RAPID TRANSIT AUTHORITY (MARTA) Atlanta, Georgia

• Worked for the City of Atlanta, MARTA, & developer CARTER • Created an economic, land use and development plan for the area

around the Lindbergh MARTA station • Conducted economic analysis, examining economic conditions and

Lindbergh’s role relative to economic growth trends; development program

DC STREETCAR Washington, D.C • Projected the outcome of implementing a streetcar by analyzing the

effects of transit investment to the New York Avenue Metro Station in D.C, the Portland, OR Streetcar, and the Seattle, WA Streetcar

• Studied economic growth in Portland, OR and Seattle, WA, and applied property value percentage increases to properties along the proposed H Street streetcar corridor in Washington, D.C.

15

RCLCO NATIONAL TOD EXPERIENCE

Project ORLANDO AND TAMPA REGIONAL EMPLOYMENT CENTERS ANALYSIS “CONNECTING FOR GLOBAL COMPETITIVENESS PROJECT” Central Florida • Completed a Metro Center analysis for all of Central Florida • Understood regional growth trends and how they impact the location

of future jobs • Analyzed the impact of transit on potential future Metro Cores

INTERNATIONAL CORPORATE PARK AND INNOVATION WAY Orange County, Florida •  Studied impact of future commuter, light rail, and BRT • Quantified potential impact of transit • Programmed communities based upon future transit opportunities • Analysis of DOT requirements for TOD and their impact • Considered the impact of an MMTD on the projects

16

SUMMARY – TOD IS RESHAPING URBAN AREAS WHILE COMPLEX, A RICH AREA FOR DEVELOPMENT