Monday, July 7, 2008

Streetcars Feasible - $388M In New Development and 700 Jobs

Grand Rapids, Michigan has just concluded a Streetcar Feasibility Study that concludes that streetcars are feasible there. The report estimates that with the first 1.6-mile segment of downtown track, this will spur some $388M in new development and create more than 700 new jobs.

The report goes on to state that the streetcar would stimulate a 74% increase in residential units that would include condos, apartments and student housing. Occupied square footage of office space within the same timeframe would increase some 24%, with occupied square footage of retail space likely to jump some 67%! The proposed route would also spur a 31% increase in the number of hotel rooms in their downtown area. Each $1 of capital investment in the streetcar would generate an estimated $3.77 in sales within the county businesses and $4.58 in sales for the state.

The study reports that the initial 1.6 mile segment would stimulate the creation of 772 jobs in the county, with an average annual wage of $38K or $72M in earnings from new jobs in the county. This is slightly less than the projected $78.7M it will take to construct the first leg of the project. 1,269 new jobs within the state are projected as well, with the streetcar project moving forward. It is further estimated that the streetcar will add nearly $15.7M in personal income tax and property tax to the county and an additional $6.9M in taxes for the state.

The American Public Transit Association and the Community Streetcar Association both conclude that streetcars generally provide 10 to 20 times their initial construction cost in private investment on or near the streetcar routing. The Grand Rapids development calculations are based on new developments all being within a one-quarter mile radius of the proposed streetcar route.

As South Fraser OnTrax has said many times, developers will write cheques for light rail. They do not so the same for buses. We will be following the Grand Rapids and other new projects closely. The full draft report is now available here. The study was approved by the Interurban Transit Partnership Board on June 25, 2008. It will be studied further, subject to availability of funding.

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