Transit-Oriented Development Rises: Cities Seek to Boost Ridership and Housing Supply

When the transit agency in the Seattle metropolitan area builds a station, it strives to use space as efficiently as possible—land is valuable. Therefore, after Sound Transit completed the Angle Lake station in 2016, about 33,500 square feet (approximately 3,112 square meters) of space remained in the parking lot.

This space is not just for landscaping. Sound Transit is selling this land in South King County to a nonprofit at below-market rates, which will build affordable housing there, along with ground-floor commercial or office space.

"We really thought carefully when designing the station so that land that might be needed during construction, such as staging areas, could be used afterward for transit-oriented development," explained Thatcher Imboden, Sound Transit's director of land use planning and development.

As transit ridership declines nationwide and housing costs rise, cities are promoting mixed-use projects around bus and rail stations, known as "Transit-Oriented Development" (TOD).

The Angle Lake station is just one example of TOD. Cities such as Los Angeles, Orlando, and Chicago also have TOD projects in operation or underway. The Federal Transit Administration is awarding $11 million to 20 projects in 12 states through a pilot program, with funding increased from last year, partly thanks to the Bipartisan Infrastructure Law.

City leaders hope TOD will provide more housing and retail space while making it easier for people to use public transit rather than drive. At the same time, cities and transit agencies must ensure TOD benefits existing residents rather than accelerating their displacement.

How Seattle is using leftover space at stations

Sound Transit has already undertaken such projects throughout the Seattle metropolitan area. The agency has developed 2,500 housing units (primarily rental housing), of which 795 have been completed and are in use. Imboden said about 64% of the housing units are affordable.

To achieve this, Sound Transit focuses on building partnerships with developers, local governments, and public and private funders.

"Land prices in the Pacific Northwest and the Seattle area overall are very high," Imboden said. "So even if we donate the land, the cost of building affordable housing is still high and requires other resources to make it happen."

At the Angle Lake station, the nonprofit Mercy Housing Northwest will lead the TOD development, building at least 85 affordable housing units. The organization will purchase the land at a discounted price of $300,000 to $400,000. Deed restrictions will ensure the housing remains affordable for 50 years.

Meanwhile, another developer will purchase another parcel at the Angle Lake station for $1.95 million, planning to build at least 230 housing units, of which 20% will be affordable, with the rest primarily at market rates.

When selecting developers and project proposals, Sound Transit sells land below market value and includes financial support with the parcel. Imboden said this is an effective way to align public entities such as city and county governments around the same goals, reducing risk and speeding up delivery while helping developers coordinate the various public agencies involved in the project.

"Integrating a lot of resources upfront helps reduce that 'loop' of figuring out how to move the project forward," he said.

Cities and transit agencies also need to be wary that these developments could exacerbate gentrification.

Anastasia Loukaitou-Sideris, distinguished professor of urban planning at the UCLA Luskin School of Public Affairs, said scholars worry TOD could replace more affordable housing with luxury housing, whose residents often do not use public transit.

While co-authoring a 2019 book on TOD's impact on communities, Loukaitou-Sideris studied whether gentrification occurs around new transit stations. The research team examined the San Francisco Bay Area and Los Angeles and found that neighborhoods with transit stations were more likely to gentrify than those without.

"We are not advocating stopping transit-oriented development because it can have positive effects, but rather using policy tools to protect existing residents in these communities from displacement," Loukaitou-Sideris said.

Patience Malaba, executive director of the Housing Development Consortium, a nonprofit housing developer organization in the Seattle and King County region, said building affordable housing near transit is an effective tool to prevent displacement.

The Angle Lake TOD prioritizes family-sized housing, which is especially urgent in South King County, home to many Black, Indigenous, and people of color communities, Malaba said. But it's not just about building housing; public entities must also work on strategies around land use, zoning, maximizing density, and subsidizing affordable housing to help residents stay in their communities.

"The equity issues around transit investment are very clear," she said. "When these investments come in, we know the typical impact is that surrounding land and property values soar. It's important that we think proactively about how to advance investment while helping people stay in their communities."

Transit-oriented development in gentrifying neighborhoods

In Atlanta, the metropolitan area's transit agency is also advancing its own TOD projects. The Metropolitan Atlanta Rapid Transit Authority (MARTA) is soliciting proposals for a future development at the Bankhead rail station in northwest Atlanta, with about 235,000 square feet (approximately 21,800 square meters) of available land.

The Bankhead neighborhood, where Atlanta rappers T.I. and Shawty Lo grew up, is currently facing the threat of gentrification. In addition to rising home prices citywide, Bankhead is under particular pressure: Microsoft is developing a 90-acre campus in this low-income community, and Georgia lawmakers subsequently allocated $6 million to update the rail station.

MARTA is expanding the station to accommodate eight rail cars by 2025, up from the current two. Debbie Frank, MARTA's director of transit-oriented development, said the agency sees this project as a prime opportunity for TOD.

"We really see the opportunity to bring new capital into these communities," Frank said.

It is not yet clear whether the development will include housing, as it depends on the proposals received. But if it does, 30% of units must be set aside for individuals earning 80% to 120% of the area median income for the ZIP code. Frank said there are two ZIP codes within a one-mile radius of the Bankhead station, with median incomes of $39,500 and just over $25,000.

MARTA is also partnering with Morgan Stanley and the National Equity Fund to create a $100 million fund to preserve affordable housing within one mile of MARTA stations.

For the upcoming TOD project, MARTA has not yet engaged with Bankhead residents, planning to do so after a developer is selected.

Matt Garbett is skeptical about whether this project will truly benefit the community.

"If you move this development far from the train station and it doesn't change anything, then it's not TOD," said Garbett, co-founder of ThreadATL, a nonprofit advocating for 'good urbanism.' "It has to be designed around the train station."

TOD must have multiple uses. "We call it the 'three T's': tomatoes, tequila, and toilet paper," he said. Everyone needs to be able to buy produce, relax, and use a restroom.

Garbett said planners must create something useful for existing residents, not just for new ones. It must become a hub for goods, services, and housing. For the Bankhead TOD, beyond ensuring existing residents are not displaced, the main street where the station sits must also be considered.

"The road itself is a six-lane nightmare; no pedestrian would feel comfortable walking on it. So will TOD ease traffic? Will it improve access to goods and services?" he said. "Or is TOD just building some apartment buildings next to the train station, mainly so people can walk to Microsoft?"

Looking ahead

Over the past decade, public transit ridership nationwide has been declining, and the COVID-19 pandemic dealt another blow. Loukaitou-Sideris cautioned that cities cannot forget this when developing TOD.

"One of the elements of transit-oriented development is transit. If transit ridership is declining, then what happens to TOD?" she said.

However, with the Infrastructure Investment and Jobs Act authorizing up to $108 billion for public transit, new TOD projects should have more opportunities, said Michael Duncan, associate professor of urban and regional planning at Florida State University.

As the U.S. population ages, these developments must also serve older adults, Duncan said. In a study of major transit stations nationwide, he found that older adults are less likely to live in these areas. Thus, municipalities have an opportunity to promote TOD for those who may no longer be able to drive.

UCLA's Loukaitou-Sideris said anti-displacement measures could include expanding rent control and inclusionary zoning, as well as providing eviction assistance for tenants.

Seattle's Malaba said partnerships and dialogue with community members are key to achieving equitable TOD.

"It has to be done through extensive, deep community engagement—not just showing a few slides to the community, but really understanding their vision," she said. "They know best which solutions work for them."