A series of factors are converging to create global opportunities for Transit Oriented Developments that are city changing in scale according to a new major report from real estate agency CBRE.
Transit oriented development involves higher density, mixed use projects that are adjacent to, or integrated with, public transport hubs.
These projects are typically master-planned to create interfaces with transport services and have the ability to revitalise under-utilised precincts while bringing significant economic and social benefits to the wider community.
CBRE’s report examines a range of successful projects around the globe, including Perth City Link in Western Australia; the King’s Cross regeneration project in London; the Hong Kong Station redevelopment; Transbay Transit Centre in San Francisco and One North Precinct in Singapore.
The report highlights a range of factors that are creating opportunities for Transit Oriented Developments, including increasing rates of urbanisation, declining productivity linked to increased travel times, a growing government focus on public transport/decentralisation and greater sophistication in project and infrastructure funding.
Key findings include the critical role that government bodies play in successful TOD outcomes, the appeal these developments have for both residents and the business community, and the opportunities inherent in these types of projects.
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CBRE Regional Director, Structured Transactions and Advisory Services, Wayne Redman, commented: “Transit Oriented Development projects have the capacity to address many of the challenges facing major cities in developed economies as a result of a rapid increase in urbanisation.""A successful project will achieve a substantial shift from private vehicles to public transport, while improving liveability and local employment opportunities.”
CBRE’s report highlights that government vision and sponsorship is crucial in facilitating the projects given the role that public transport plays in addressing the long term sustainability of major cities – specifically issues such as traffic congestion, travel times, housing affordability and pollution.
“Businesses are requiring work environments which both attract and retain employees. The mixed-use nature of Transit Oriented Developments creates activated precincts with retail and entertainment services for employees," Mr Redman said.
"These locations also reduce business demand for car parking, which in turn reduces project construction costs and leasing costs for occupants,” Mr Redman said.
However, CBRE’s report highlight that incentives may also be required to attract tenants, as illustrated by the long term tax incentive schemes and rental subsidies offered in Singapore to facilitate the One North Precinct.
Mr Redman added: “While the projects are more complex than conventional brownfield or greenfield mixed-use projects, the benefits clearly warrant the effort in addressing the challenges.""Government facilitation is critical and can take a number of forms, including the provision and rezoning of appropriate sites, providing development certainty, directly funding transport infrastructure and coordinating issues with the relevant authorities. “The ability to attract business occupiers is another key element of a successful project, hence the critical need for linkages to public transport.