South Corridor Development Summary

URBANLANDINSTITUTE

112 KROG STREET NE SUITE 14 | ATLANTA, GA 30307 CONTACT | 404.681.0006

SOUTHCORRIDORDEVELOPMENT

SUMMARY

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NCG OVERVIEW

• Noell Consulting Group• Real estate consultant based in Atlanta• Conduct market analyses and consumer

research for both public sector and private sector clients• Conduct numerous studies along transit corridors

and locations• Studied South Corridor since 2002• Three other planned corridors• Conducted numerous TOD analyses in

Washington, DC, Los Angeles, San Francisco, Atlanta, Raleigh & Charlotte

OVERVIEW OF THE SOUTH LINE

• Corridor opened in November 2007

• First corridor in five corridor system

• Includes 11 stations outside of Center City

• Follows existing rail line to the south

SOUTH LINE CONTEXT

• Using existing rail line• Bringing people to the

corridor, not the corridor to people

• Corridor does not traverse any major employment cores outside of Center City

• Higher incomes largely to the east

• Crosses/accesses freeway only at the ends of corridor

CORE

CORE

CORE

CORE

SOUTH LINE CONTEXT

SS

S

S

S

S

S

S

S

S

S

CONTEXT—TIMING WAS TOUGH

-1,000,000

-500,000

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

2005 2006 2007 2008 2009 2010 2011

Mecklenburg Office Absorption

-40,000-30,000-20,000-10,000

010,00020,00030,000

2005 2006 2007 2008 2009 2010 2011

Mecklenburg Employment Growth

SOUTH LINE SUCCESS TO DATE

• In spite of challenges, TOD has been quite strong

• Completed Projects• $341M in tax value

added• 2,168 MF units

• 9.2% capture• 308,400 SF office

• 1.9% capture• 252,000 SF retail

• 2.5% capture

TALE OF THREE SEGMENTS

• South End• Carson• Bland

• Mid-Corridor Stations• Scaleybark• Woodlawn

• Southern Stations• Arrowood• Sharon West

• East-West• New Bern

• Tyvola• Archdale

• I-485

SOUTH ENDSEGMENT

• Completed Projects• $324M in tax value

added• 95% of corridor total

• 1,976 MF units• 91% of corridor total

• 308,400 SF office• 100% of corridor total

• 190,300 SF retail• 76% of corridor total

SOUTH END SUCCESS

• Leasing agents & Realtors• transit access important for 30% -

40% of residents• South End rental apartments

• 12.5% premium over inner ring, non-rail projects

• Achieving rents that allow more urban product ($1.52/SF)

• Office & retail• Growing design district, restaurants/

nightlife, urban Lowe’s• Commercial generally not achieving

premiums over other intown cores

MID-CORRIDOR

• Completed Projects• $1.76M in tax value


• 0 MF units• 0% of corridor total

• 0 SF office• 0% of corridor total


SOUTHERNSTATIONS

• Completed Projects• $15.6M in tax value


• 192 MF units• 9% of corridor total

• 0 SF office• 0% of corridor total


TRANSIT IMPORTANT FACTOR, BUT NOT MOST CRITICAL

• “Transit doesn’t make a bad location good, it makes a good location better”

• Portland TriMet interview

• Transit is a key part of creating convenience and lifestyle, but must have other lifestyle or selling propositions

• Employment proximity• Affluence of neighborhoods

• Create price alternative hsg needs• Walkability• Unique character

CASE STUDY COMPARISON

S

S

Bland Street Station Tyvola Station

CASE STUDY COMPARISON

Bland Tyvola

Predominant Land Use Mix of Loft Commercial, Residential, some Ind.

Mix of Strip Retail, Bus. Park

Shortest Walk to Exist Res, 2005 .19 miles .31 miles

Walk Score 82 68

Avg Area Home Sales Price $291,000 $166,000

Distance to Major Office Core .8 Miles 2.8 Miles

Station Format Surface Elevated

Rental Apt Lease Rates $1.50 $1.00 - $1.10

Parking Supported Decked Surface

Supportable Densities 60 – 100+/Acre 25 – 30/Acre

Retail Rents $22 - $26/SF $12 - $16/SF

WHERE ARE WE HEADING?

• Next wave of apartment construction starting up

• 1,535 new units in next two to three years

• 3,700 new residential units in roughly a decade

• Projects in South End, extending south to New Bern Station

• Developers very tuned into value of transit—emphasize Blue Line access as a key selling feature

• Commercial still a tougher challenge, but housing creates more potential

WHERE ARE WE HEADING?

• Central and Southern sections likely to remain relatively quiet

• City/CATS will need to identify strategies & investment to create value

• Parks & Plazas• Greenways• Institutional units & anchors• Use of financial tools

• Lack of land control around stations an issue

IN CLOSING

• Development has been strong given timing, market struggles, and attributes of corridor

• Residential has been much stronger than commercial

• Transit undoubtedly “elevating” locations where lifestyle proposition/ convenience already exist

• 3,700 units in 10 years• Stations lacking that proposition a much

tougher development scenario• Other investments/steps may be needed to

facilitate development• Lack of CATS property makes this more

challenging

URBANLANDINSTITUTE

112 KROG STREET NE SUITE 14 | ATLANTA, GA 30307 CONTACT | 404.681.0006

SOUTHCORRIDORDEVELOPMENT

SUMMARY

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OTHER FACTORS WEIGH HEAVILY

Factor South End Center Stations

Southern Stations

Housing Value

$325,000 $128,000 $71,000

Walkability Score

76 60 44

Distance to Center City

1.3 4.5 6.75

Character Med. To High Low Low

Station Visibility

High—one parcel deep from S. Blvd

Moreremoved—

generally low

Moderate—somewhatremoved

Feasibility of Development

Redev.Feasible

Redev—not feasible

Mixed—somegreenfield

Business

South Corridor Development Summary