The Latest Urban Living Trend: No Cars Allowed
New York City and San Francisco have taken steps to limit the use of private vehicles on busy streets.
New York City has limited access along an eight-block section of 14th Street to buses, delivery trucks, emergency vehicles and cabs for drop-offs and pickups only.
San Francisco plans to ban private cars on a section of Market Street as part of a $600 million makeover that's slated for completion in 2025.
Other cities may look to these models, suggesting that the location of public transit may play an even greater role for multifamily housing developers and owners.
Higher rents near transit stations
Multifamily developers have the potential to charge higher rents for properties located near transit stations.
A joint National Association of Realtors (NAR) and American Public Transit Association (APTA) study found rent increases in seven U.S. cities from 2012 to 2016 were significantly higher in neighborhoods near public transit stations than in neighborhoods farther away.
"Overall, this study demonstrates that residential property values, residential rents and office property sales consistently performed well in proximity to public transit," the report stated.
Reduced parking requirements near transit
The potential for reduced parking requirements offers another benefit for developers, according to a report by the National Multifamily Housing Council (NMHC) and National Apartment Association (NAA). These requirements can represent some of the biggest costs for multifamily housing development with surface lot spaces costing $5,000 each and underground spots costing $60,000 each.
"Many cities can significantly reduce or even eliminate parking requirements, particularly in transit-oriented or urban infill development," the report stated. "This approach will become increasingly valuable as ride-sharing increases and automated vehicles become adopted, dramatically reducing parking demand."
Cities that have revised parking requirements to encourage transit-oriented housing development include Boston, Denver, Minneapolis, San Francisco, Seattle and New York, according to the report.
Multifamily housing developers and owners have also responded to residents' heightened interest in transit by creating new amenities in lobbies, Multifamily Executive reported.
Two amenities popping up primarily in higher-end buildings are digital transit information screens and dedicated ride-waiting areas. The screens show such information as bus schedules, subways stops, nearby bike and scooter rental availability, and ride-share wait times, in real time. The waiting areas might include seating, a coffee bar and a mobile-device charging station.
Some transit agencies have responded to the trend toward transit-oriented housing with their own affordable housing policies. In Los Angeles, for example, the city's transit agency has instituted a housing policy, and distributed $9 million in loans for affordable housing projects adjacent to its stations.
New units in the works for L.A.
Car-loving Los Angeles could see a boom in transit-oriented housing development. The city's Transit Oriented Communities program, launched in September 2017 has prompted developers to propose more than 12,000 new units.
The program allows developers to build 35 percent to 80 percent more units, reduce parking spots, and in some cases, exceed building size and height limits if a project is located within one half-mile of a major transit stop and developers set aside affordable units for low-income residents.
Although none of the 12,000 projects has been completed — and most have not yet broken ground — the flood of proposals suggests a dramatic shift in housing development in a city known for sprawl.
While the fully realized future of transit-oriented housing throughout the U.S. may not have arrived yet, the train has certainly left the station.