In anticipation of the Silver Line, nearly twenty development projects, with an estimated value of more than $18 billion, are underway near the Metrorail stations, helping attract riders and generating valuable benefits for Fairfax County.
Ahead of the Silver Line, many development projects are underway around the new stations. Image from Cushman and Wakefield, click link at left for full report.
In a new report, the real estate firm Cushman & Wakefield documented twenty real estate development projects “in the pipeline” near the five new Silver Line stations. Some are under construction now, others are in the approvals process, and a few are on hold, but together they total:
- Over 20 million sq. ft. of new office space, which would increase the total office space in the Tysons area by 40%.
- Over 2 million sq. ft. of new retail space. That’s more than twice the size of the Tysons Galleria mall.
- 17,800 new residential units, or more than double the current population of the Tysons area.
- 9,300 hotel rooms
Metro estimates that these projects are valued at more than $18 billion, and will generate millions per year in tax revenue for Fairfax County (estimated using industry-standard construction costs). Some of this tax revenue will be captured by special tax districts in the Tysons and Silver Line areas. In 2011, we estimated that Fairfax County received around $30 million in tax revenues from properties within a half-mile of its five existing non-Silver stations.
The development brings great benefits to Fairfax County and will encourage riders to use the Silver Line, but there remains a strong need to improve the walking and biking environment near the new stations. Pedestrian and bicycle access will be key to meeting our ridership goals for the new Metrorail line, but walking and bicycling conditions remain challenging in the area.
New buildings right near Metrorail stations are 23-30% more valuable than buildings farther away, showing that our funding partners can generate significant property tax revenues from Metro.
A recent study shows that Metrorail stations in Arlington’s Rosslyn-Ballston corridor are powerful anchors for economic development and value. The report, by the real estate firm Cushman & Wakefield, showcases the substantial value the region can realize with good transit-oriented development policies near stations. Among the report’s findings:
Offices in the Rosslyn-Ballston corridor right near Metro command higher rents. Source: Cushman & Wakefield via washingtonpost.com. Click for original context.
- Being able to walk to Metro is worth a lot. New office buildings within 500 feet of a station in Arlington’s Rosslyn-Ballston corridor are earning a 30% premium over buildings under construction just a quarter-mile away. For apartment buildings, the premium is 23%. No wonder walk access to Metrorail is on the rise, especially from those close by the station!
- 92% of over 20 million square feet of office space under construction in the Rosslyn-Ballston corridor is within a quarter mile of a Metrorail station.
- Conversely, new office buildings built farther than a quarter-mile from Metro are worth 18% less in rent.
These “rail premiums” of 23-30% are significantly higher than the 7-9% we found in our “Business Case for Transit” study, because of several significant differences in methodology. We looked at the assessed value, not the market/rental rate of property. Also, we looked at all properties in the region, rather than just those under construction in one corridor.
Although the presence of Metrorail creates this value premium near stations, Metro does not receive any of these revenues directly, even though continued rebuilding and improvements are needed to address state of good repair and relieve capacity issues in the corridor.
Nevertheless, this report certainly confirms that Metrorail increases property tax revenues, and shows just how big that value can be in certain markets.
NPR’s Morning Edition yesterday highlighted Arlington County‘s success in tackling commuting challenges, particularly as a result of the decision to bring Metrorail and transit-oriented development to the Rosslyn-Ballston corridor.
When the Metrorail system was initially designed in the early 1960s, the plan proposed running the Orange Line in the median of what would ultimately become Interstate 66. Arlington County officials lobbied hard and put forward county funds to bring the Orange Line to its existing home, under Wilson Boulevard. They foresaw the benefits of high capacity transit IN the neighborhoods, as opposed to adjacent to the neighborhoods. They also set forth zoning, planning, and other policies to ensure that the county would maximize the benefits from that decision. The NPR story talks about the results of those decisions, the shift from a post-World War II auto-dependent suburb to a vibrant, mixed-use community that has become the gold standard for many cities across the world.
Orange Line – Proposed and Actual Alignments
For more background on the history, growth, and experience with transit-oriented development in the corridor, check out this powerpoint from the Arlington County Department of Community Planning, Housing and Development. Not only does it provide additional information, it has some terrific before and after photos of the different Arlington neighborhoods and how they have changed. Parkington, anyone?
If you’d like to contribute to the NPR series, you can share your commuting experience with Morning Edition – #NPRcommute.
Yesterday’s NPR story was the first in a multi-part series on how communities are tackling commuting challenges.
Portions of Momentum are already being executed, meaning that elements in this strategic plan under Metro’s control are already in implementation mode. Engineering work is well-underway to support some of the immediate and near-term investments and innovations to carry the system to the year 2025. Some of the projects and their dates of completion or anticipated completion include the following:
Metro’s staff and Board are already laying the financial underpinnings to execute the strategic plan. In 2013, the Board approved Metro’s multi-year capital and operating budgets. While continuing laser-like focus on safety improvements and the rebuilding of the existing system, the FY 2014-2019 Capital Improvement Program (CIP) includes a number of significant investments that lay the groundwork for the implementation and execution of Metro 2025, which is described in the following section and later in this document.
What happens if Metro completes MetroForward and ceases there? Simply put, the region cannot afford for Metro to get the system back to where it should have been, but stop short of preparing the system for the growth that has already created overcrowding conditions and service disruptions, let alone prepare for additional growth that has yet to come.
Note that the region is already the most congested area in the country, and Metro is a huge part of what keeps this region moving and working in spite of its transportation gridlock. Stopping short of implementing Metro 2025 and Momentum means that the region’s attractiveness as a place to live and work may be threatened. The region could face the following consequences:
- Metro will degrade quickly with more delays and service disruptions – visible progress will be lost;
- Shoulder-to-shoulder, rush hour conditions experienced today on an increasing number of rail lines and stations will grow system-wide and become worse;
- Crowding similar to Presidential Inauguration Days will likely become the norm;
- Customers will be left with 1970s-era communication and trip planning services;
- Residents would have fewer jobs within an acceptable commuting distance and employers would have access to a much smaller pool of employees; and
- The regional transit system will advance towards antiquity, harming the region’s competitive advantage for talent, jobs and investment dollars.
A next generation communications system would expand current communications infrastructure to provide an integrated one-stop communications hub for the region’s transit customers. Proposed improvements will capitalize on efforts already underway to improve the functionality of the rail control software. They include the next generation of the Passenger Information Display System (PIDS), new public address systems, improved station signage, and equipping station managers with mobile devices. Bus and train information will also be integrated, with real-time information displays to well-used bus stops.
Metro also delivers quality-of-life benefits to individuals by reducing the costs of travel and minimizing environmental impacts. Without transit:
- Congestion at peak times would increase 25 percent, costing over $1.0 billion annually in wasted time.
- Households would spend an additional $500 million/year in auto expenditures, including an additional 41 million gallons of fuel annually.
- Air quality would worsen because of an additional 260 tons of volatile organic compounds, 22 tons of particulate matter and 500,000 tons of CO2 equivalent in the air, the equivalent of 9 billion party balloons.
Adding new Blue Line connections seeks to restore train frequencies to every six minutes during the peak period between Pentagon and Rosslyn stations, resulting in less waiting time and crowding for Blue Line riders in Northern Virginia. Once the Silver Line opens, the Blue Line service will operate every 12-14 minutes as opposed to the previous six minutes. The feasibility analysis is currently underway and has identified two potential alternatives to create new connections:
- Alternative 1: Add rail track that would create a new connection between the Blue and Orange/Silver Lines, or
- Alternative 2: A second Rosslyn Station for a new Blue Line with an underground passageway to the existing Rosslyn station, which would connect to the Orange/Silver Lines with a pedestrian tunnel.
Proximity to transit, especially high-quality, frequent, high-capacity rail, increases property values, attracts development and provides mobility choices. Property values are higher near Metro’s high-quality, high-frequency, high-capacity services, and deliver an incremental increase in total tax revenue to the Compact jurisdictions.
- Property taxes on land around Metrorail stations generate $3.1 billion annually in revenues to the jurisdictions.
- Of these revenues, $224 million is extra value that would not exist without Metro. This amount is equivalent to providing the following public services.
In September 2012, MWCOG released Economy Forward, a call to action for a more competitive metropolitan Washington. This report called for strong centers with housing, jobs, and access to transit as a means to enhance the region’s competitiveness. Through monthly meetings with public and private nonprofit and academic leaders, it concluded that the transportation network is one of the five critical challenges in recruiting new business to the Washington region. It also concluded that “without adequate funding, Metro and the region’s highways will become even more congested, which will hurt the region’s productivity and economic growth potential.”