Title

TRANSIT'S VALUE-ADDED EFFECTS: LIGHT AND COMMUTER RAIL SERVICES AND COMMERCIAL LAND VALUES

Document Type

Journal Article

Publication Date

2002

Subject Area

land use - transit oriented development, economics - benefits, mode - rail, mode - tram/light rail

Keywords

Transit oriented development, Santa Clara County (California), Railroad commuter service, Light rail transit, Land values, Hedonic price models, Commuter rail, Commercial strips, Benefits, Accessibility

Abstract

Transit-oriented development has gained favor as a means of reducing traffic congestion, promoting affordable housing, and curbing sprawl. The effects of proximity to light and commuter rail stations are modeled as are the effects of freeway interchanges on commercial-retail and office properties in fast-growing Santa Clara County, California. From hedonic price models, substantial capitalization benefits were found, on the order of 23% for a typical commercial parcel near a light rail transit stop and more than 120% for commercial land in a business district and within 0.25 mi of a commuter rail station. Such evidence is of use not only to developers and lenders but also to transit agencies facing lawsuits over purported negative externalities associated with being near rail. It can also help in the design of creative financing, such as value-capture programs.