The Economic Development Impacts of Streetcars: Measuring the Impact of Streetcar Projects and Identifying the Factors Necessary For Stimulating Development in Streetcar Corridors
Creators: name: King, William T.
Publisher: name: The University of North Carolina at Chapel Hill University Libraries
Year: 2014

description: In the past decade, streetcars dramatically increased in popularity with high expectations for stimulating economic development in the aftermath of the recent recession. Since 2009, 14 streetcar projects began construction in large and mid-sized cities and received over $500 million in federal funding. But the actual development impacts of these new streetcar projects are not well understood or studied. The academic literature on the impacts of streetcar systems is nearly non-existent and most of the expectations for streetcars are based on the experiences of lines in Portland and Seattle. Given the substantial amount of investment from localities and the federal government, great expectations for new development, and wide array of cities attempting to construct streetcar systems, the economic development impact of streetcars is important to study and understand. This study found: • Many cities base their economic development projections either on the experiences of transit-oriented development on other types of rail, like heavy rail, which may have different development potential or they are based on the experiences of Portland and Seattle, which may have different planning and development environments from other cities. • Federal agencies award streetcar projects primarily on a qualitative analysis that contains very little quantitative rigor or analysis. Furthermore, federal officials do not distinguish between different transit modes when it comes to potential development impacts, despite research showing varying levels of development from different modes. The development impacts promised by these projects are left largely unchallenged and, instead, cities create narratives of the transformative effects streetcars may have for their communities. • Some streetcar corridors do see substantial growth in development, but not all. Using property values to demonstrate economic development progress, I measured development impacts for recent streetcar lines in Tucson and Atlanta. Tucson demonstrated the largest impact in property values with an over 75% increase in value from two years before the streetcar announcement to 2014. This increase is impressive compared to another corridor in downtown Tucson, which actually saw a slight decline in property values, overall. The Atlanta streetcar corridor, though, saw no increases in property values and saw a significant decline in value that corresponds to the same decline most of the city experienced during the recession. And compared to a comparable corridor in the city, the streetcar corridor did not demonstrate substantially fewer losses in property value. Atlanta illustrates that streetcar investments alone do not stimulate development. • Using Tucson and Atlanta, along with Portland and Seattle, I found a number of other factors that may contribute to streetcar corridor development. Existing and growing real estate demand, large property owners, zoning, tax incentives, and other related investments in infrastructure are all necessary components of stimulating economic development in streetcar corridors. Additional data analysis in Tucson found that the streetcar corridor was already seeing large increases in property values prior to the construction of the streetcar. • More robust metrics and analysis of streetcar corridors are necessary for communities and the federal government to better understand the potential development impacts of these projects and weigh their costs and benefits. Furthermore, communities should understand that streetcars likely will not stimulate development without the presence of other investments and factors.