Retail Traffic

Next Stop: Suburbia

Balancing briefcases and steaming cups of coffee, commuters stream onto the train waiting at the Plano Station in suburban Dallas. The riders are just starting their morning routine, having taken the short walk from their nearby homes. Within 40 minutes, they're in downtown Dallas, an 18-mile trip that would take at least 70 minutes by car.

The downtown Plano Station isn't just a park-and-ride stop marooned in a sea of asphalt like other suburban Dallas Area Rapid Transit stations. Instead, it boasts the first of a planned series of suburban transit-oriented developments — or TODs for short — along the 45-mile DART light rail system.

Downtown Plano's TOD has 500 residential units and 40,000 square feet of retail and commercial space in two projects: 15th Street Village, a townhome and condo development, and Eastside Village, a development featuring rental housing above street-level stores, boutiques and cafes.

At night, the downtown Plano station and the surrounding area is bustling with residents and visitors who've come to grab a bite to eat at one of several restaurants or to see a show at the Plano Arts Centre.

“The biggest problem with suburban transit stations up to now has been that that they're nothing but islands,” says John Waldron, an associate partner at Irvine, Calif.-based design firm MVE & Partners. “These islands need to make a bridge to the surrounding communities.” (See Expert Analysis on page 39.)

Today, more and more developers are taking the concept of transit-oriented developments to the surburbs. “There's a great growth opportunity in the suburbs for TODs,” says Paul Morris, a managing principal at PB PlaceMaking, a division within global design and construction firm Parsons Brinckerhoff, which specializes in transit development.

Over the next 20 years, nearly 15 million households will look for housing in transit zones, according to a recent study conducted by the Center for Transit-Oriented Development, titled Hidden in Plain Sight: Capturing Demand for Housing Near Transit.

While TODs have been on the planning menu for urban developments for a while, interest in the suburban version is just now taking off as new light and heavy rail, along with commuter train systems, expand from city centers. And, with more companies opening facilities in outlying neighborhoods, developers are striving to create live/work/play projects at the stops.

The opportunities will be diverse as TODs pick up steam. A parent, will be able to, for example, drop their child at day care and their clothing at the cleaners before starting for work — and pick them up on their way home.

Make no mistake, though, TODs face serious challenges. They are hard to fund and require public/private partnerships. Addition-ally, finding the right mix of housing and retail can be difficult, and attracting residents and retailers takes time.

“Building a suburban TOD is actually like building a neighborhood or community,” Morris says. “It's not for the faint of heart, because it must take into account social and economic issues.”

Beyond the city center

As metro areas across the U. S. add to their populations, city and state entities are finding it difficult to manage the resulting traffic congestion, Morris says. While Americans are spending hours trapped in their cars for both work and play, municipalities and transit agencies are working overtime to address the need for transportation.The prospect of far-costlier oil only adds to the demand for new alternatives to sprawl and crawl.

Today, 27 regions across the U.S. boast some form of commuter mass transit such as heavy or light rail, commuter rail, streetcars and trolley buses, bus rapid transit or cable cars, according to CTOD.

These systems have spawned more than 100 TODs and another 100 joint development projects — most in urban areas, according to a report by the Transit Cooperative Research Program, titled Transit-Oriented Development In The United States: Experiences, Challenges and Prospects.

Under the Federal Transit Administration's (FTA) New Starts program, 26 new or expanding TOD projects totaling an investment of $1.5 billion have been recommended. Programs have been approved for San Diego, Denver, New York City, Washington County, Ore., Dallas, Phoenix and Salt Lake City. Moreover, an additional 52 transit developments are in some stage of the federal approval process, according to CTOD.

Historically, development that sprang up in and around transit systems happened by circumstance rather than through a conscious effort involving extensive planning and partnerships, Morris says. In fact, he compares today's suburban TODs to the rural villages and towns that grew up along the Intercontinental Railroad.

Because many suburban transit stations are built from scratch on greenfield sites, municipalities, transit agencies and developers can approach TODs proactively. In Raleigh-Durham, N.C., for example, the Triangle Transit Authority (TTA) has taken the unique step of designating one firm, Cherokee Investment Partners, as the master developer for its entire 28-mile transportation system.

By having a master planner, the stations themselves can be developed in a complementary fashion instead of in a competitive environment, says Lee Norris, a Cherokee managing director.

As the master developer, Cherokee Investment will determine commercial uses for each station along the Regional Rail Transit System that will link Durham, Research Triangle Park, Cary and Raleigh. Work on the project, which costs $689 million, is scheduled to begin next year.The system is expected to carry about 22,000 daily riders by 2025.

Norris says most stations will have a mix of uses: offices, residential and retail. “I envision that all stations would have a residential component,” he adds. And retail.

“Because TODs need some transitional space, the retail component ends up serving as the connective tissue for the transit and other uses,” Waldron says.

Completing the community

In suburban San Diego, for example, the Promenade at Rio Vista includes 30,000 square feet of retail space and more than 900 apartments. The project, which is the city's first TOD on the Red Car Trolley Line, wraps around a plaza that connects to a neighborhood center.

While retail may be an important part of suburban TODs, it requires the “most tuning,” according to Roy Higgs, CEO of Baltimore. Md.-based Development Design Group Inc.

Developers and municipalities “always overestimate” the retail market, says Morris. The city and county may be wishing for more sales tax revenue in the market, but demand doesn't change just because there's new transit.

“One of the biggest pitfalls is that a developer will put in retail that isn't unique to that location,” says Morris. “There's only so much market at each station, and a developer shouldn't overvalue the ability of transit to impact the performance of the retail.”

Moreover, experts advise that developers do the same amount of due diligence for a TOD that they would for a typical mixed-use project.

In the suburbs, it takes a lot of people to create an “urban” neighborhood. And the growing demand for housing in transit zones can help create a criticial mass. “Suburban cities grew up around jobs and subdivisions, and TODs create the town center that never had the opportunity to develop,” Morris points out. “A TOD is the way to complete the community.”

Still, agencies, municipalities, and developers may tend to expect too much: economic development, community enhancement and identity building. “Just because a development is attached to transit doesn't mean it will be successful,” Morris says. “What is often missing is a real sobriety about the market. They don't have to give up their vision, but they do need to anchor it with what the community needs.”

Today, paradoxically, suburbanites are looking for the convenience and vibrancy of urban life. “There's a desire to spend less time on the freeways, and transit villages offer a different way to live,” says Waldron.

Expect 250 to 300 percent housing growth in cities with new or expanding transit systems, states the CTOD study. Moreover, in fast-growing metro areas, most of which are in the Sun Belt or Mountain West, existing and future transit zones have the potential to accommodate 15 percent to 25 percent of the household growth projected between now and 2025, according to the study.

“Transit-oriented development had been creeping along until the residential market really took off over the last two to three years,” Higgs says. “We now see a significant change and there's demand to build these developments with residential and retail.”

Gary Woods, a principal at Lincoln Station Investors, which is a joint venture of Denver-based Bradbury Properties and Westfield Development, contends that there is a part of the population that cannot be served with urban living or suburban atmosphere. Woods has coined the term “go-burban.”

“Whether it's suburbs or downtown, you're dealing with lifestyles and trying to create a place where people want to be,” says Woods. “Many want the urban experience in the suburbs, and that can be experienced in these space around transit stops.”

In Denver, Lincoln Station Investors is working with the Regional Transportation District (RTD) and the Colorado Department of Transportation to create a light rail station and the city's first TOD along the Southeast Corridor Light Rail project, dubbed T-REX.

“We were initially skeptical about the station and doing a TOD,” says Woods, He admits that most of the reluctance was rooted in a lack of knowledge about TODs.

After taking a look at several projects across the country, talking with other developers and evaluating the demographics around the proposed station, the company eventually saw value in a TOD that incorporated residential, office and retail. Lincoln Station Investors worked with RTD to design the project, which is on 53 acres in Douglas County.

Originally, Bradbury Properties, a ranching family that had owned the land since the mid-1950s, expected to develop an office park there. Today, the plan is to use roughly six acres for the rail station and platform, along with a 2,000 car parking structure and a bus turnaround. The remaining land — about 46 acres — will be built out with 1,500 residential condos or rental units; 500,000 to 700,000 square feet of class A office; and 70,000 square feet of retail space.

Lincoln Station will be located on the far end of T-REX extension. The extenstion adds 19.1 miles to the existing system, following I-25 from Broadway in Denver to Douglas County, with a spur along I-225. Projected cost is $879.3 million, with a federal New Starts share of $525 million.

In suburban Las Vegas, meanwhile, local developer Centra Properties has partnered with KB Home to build Stone Lake Village. The $400 million, 40-acre project along the city's proposed light-rail system will be the area's first TOD, offering 1,200 medium- and high-density homes and condominiums. Scheduled to break ground early next year, the project will incorporate a significant amount of retail, according to Kenneth Sullivan, co-founder of Centra Properties.

“When we built this city, we never really imagined that we would be as large as we are and we don't have the freeway systems to accommodate the growth,” Sullivan says. “Because of the cost of land and changing lifestyles, we're getting more dense, and with that comes more mass transit.”

Las Vegas, like many growing cities, is finding that it's not always easy to get from one's home to work. For example, the bulk of jobs are located along the Las Vegas Strip, also known as the resort corridor. However, most residents live in the suburbs. “We need to get everyone into downtown without them having to get into cars,” Sullivan says.

Sullivan says he thinks people will want to live in Stone Lake Village because of the convenience. “It may sound corny, but it's a lifestyle choice,” he says. “It's not about not having a car; it's about not using it as much.”

As part of the planning for Stone Lake Village, Centra and KB Home looked at several other cities and their TODs. “What we realized was that we need to mix the product types within the development,” he says, adding that successful TODs also have plenty of pedestrian space.

Providing the right mix of housing and retail is one of the greatest challenges, Morris says. “One of the biggest lessons we learned from previous TOD projects is that the development has to meet the needs of the neighborhood,” he says, adding that successful projects incorporate both housing and retail components together.

Manufactured charm

Experts point to the importance of having housing at multiple price points to accommodate a cross-section of resident with varying incomes. “The goal of most suburban TODs is to replicate the charm of historic cities,” Morris says, pointing out that it takes time for an area to evolve.

In suburban Washington D.C., the neighborhood around the Courthouse Metro stop in Arlington, Va., has changed drastically since the first TOD was completed in the late 1990s. Initially, the station boasted too much office space, limited housing and it lacked service-related retail to accommodate a residential population. In short, the TOD's mix of uses was off, Morris says.

The Courthouse TOD didn't immediately find success; the office component leased up slowly, while retailers experienced minimal activity during the day and suffered through nights and weekends with little or no foot traffic. Over time, the TOD has evolved to incorporate more rental and for-sale housing, along with an entertainment component and service-related retail and restaurants. The station and its TOD has become a vibrant part of the Metro system.

Indeed, the most successful TODs, urban or suburban, are built in collaboration with the transit agencies, other government entities and developers, Morris says. “There's not enough money in the world to create an entire neighborhood by yourself,” he points out. “The only way to get it done is to do it together.”

Because the state and federal government finance the bulk of the nation's transit projects, it makes sense that developers interested in TODs should work with public entities.

“The public partner has made the effort and investment to finance, design and construct and operate (the transit systems),” says John Stainback, a senior vice president and national director of public/private development for LCOR Inc. “Consequently they must be part of any team to finance or develop any commercial development adjacent to the transit station,Potential tax revenue and new jobs create a “strong rationale” for city, county and state entities to participate in public-private partnerships, Stainback says.

For their part, developers can minimize pre-development risk related to zoning and entitlements if they work with the public sector. For example, city and county zoning often prevents higher-density development, especially in the suburbs. But, developers can benefit from the “relaxation of certain rules” related to density, Higgs says, when they bring on public partners.

“You can't do these developments without engaging the public sector,” Higgs says. “Without public support it might take twice as long for approvals.”

By all accounts, the financial support is there, the desire for a live/work/play space is there and the demand for housing is there.

Build TODs, say supporters, and they will come.


Based on population growth and suburban transit system expansion.
1. Dallas
2. Denver
3. Houston
4. Las Vegas
5. Oakland (Bay Area)
6. Miami
7. Phoenix
8. Salt Lake City
9. San Diego
10. Seattle
Source: Paul Morris Managing principal PB PlaceMaking
Hide comments


  • Allowed HTML tags: <em> <strong> <blockquote> <br> <p>

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.