Financing Transit -Oriented Development (TOD) with …...Outline Transit Oriented Development (TOD) as the Most Effective Measure for Sustainable Urban Development How to Maximize
This document is posted to help you gain knowledge. Please leave a comment to let me know what you think about it! Share it to your friends and learn new things together.
Transcript
2nd
2nd Technical Deep Dive on TOD, Tokyo, May 29, 2017Hiroaki Suzuki
The World Bank Urban Development Consultant and Former Lead Urban Specialist of the World Bank 1
Financing Transit-Oriented Development (TOD) with Land Values
The Tokyo Station area, 120 ha of land surrounding the Tokyo Station houses 4,000 companies, which generate a revenue totaling over 135 trillion yen or about 10% of Japan's total corporate revenue. It covers 13 stations and 21 railway lines including that of bullet trains that connect Tokyo with other regional cities in Japan. The Tokyo Station area has been built over many years with careful planning and financing under close cooperation between the governments and private sector. . The Tokyo Station area with its proximity to the Imperial Palace, is also a pedestrian-friendly, socially vibrant area where tourists and locals can enjoy its trendy cafes and shops or stroll around to watch street performances. While it will not happen overnight, the Railway City Project has a huge potential to become a similar economically vibrant and environmentally friendly space.
OutlineTransit Oriented Development (TOD) as the Most Effective Measure for
Sustainable Urban DevelopmentHow to Maximize Values of TODFinancing TOD with Land Values – Land Value CaptureLand Value Capture Global Good Practices: Schemes and InstrumentsHong Kong R(Rail)+P (Property) Model Tokyo Inclusive Multiple Integration ModelEmerging Land Value Capture in Cities in Developing Countries
Critical Factors for Success of LVC in Developing CountriesConclusion
2
TOD As Effective Measure for Sustainable Urban Development
3
TOD Promoting Urban Sustainability
Source: GIZ/World Bank
www.worldbank.org/urban4
TOD & Triple Bottom Line
Economic
Environmental
Social
Time Saving Energy Saving Space Efficiency Infrastructure Cost Saving Synergy & Creativity Agglomeration Economy Functionality
Air Pollution Reduction CO2 Reduction Land & Green Preservation Biodiversity
Accessibility & Mobility Access to Jobs and Services Affordable Housing
5
Aging Society
Resilience to Disaster
Economy of Agglomeration and Connectivity with Tradition in Global Capital (Tokyo Station Area)
Photo: HSuzuki
Economic
6
Green TOD (Freiburg, Germany)
Photo: Wulf Daseking
Environ-mental
7
Electric vehicles
Gate Square commercial and office building
BEMS
Gate Square hotel and residences
HEMS
Solar power generationStorage battery
BEMS
LaLaport KASHIWANOHA
Park City Kashiwa-no-ha Campus Ichibangai District
HEMS
HEMS
Park City Kashiwa-no-ha Campus Nibangai District
Kashiwa-no-ha Smart CenterA central control room for a smart city
Value is created by combination of transit and its influenced land use
Transit
Business As Usual Vertical & Horizontal TOD
Quantity - Density
Quantity - CatchmentVC1
VC2
OV
VC2
OV
VC1
Tools• FAR Increase• Transfer of
Development Right• Land Adjustment• Urban Re-development,
etc.
Tools• Transit Feeder• Bus Terminal• Bicycle Lanes, etc. 11
Value Capture (VC1)
Original Value (OV)
GROW HIGH: Increasing Densities
12
13
Dveloping Countries: Average Built Up Densities
Beijing
Bangalore
HyderabadTianjin
Shanghai
Guangzhou
Hong Kong
Ahmedabad
Curitiba
Articulated Density Matters;Not Average Density
14
Source: OECD Compact City Policies / Laruelle, N
Uniform Average Population Density can havetotally different height and spatial form. Whatmatters most for transit and land integration is notaverage population density, but articulated density.
Bogota: Low (<2) FAR ControlDoes Not Help Create Articulated Densities
15Source: The World Bank Bogota Case Study
Presenter
Presentation Notes
Bogota’s FARs are very low and uniformly distributed. Except for CBD and some perpheirial areas, FAR are less than 2 even the proximity of BRT stations. Global case cities have allocated much higher and diversified FARS. For example, FARs range from 12 to 25 in Singapore; 1 to 20 Tokyo; 1 to 12 in Hong Kong SAR, China; and 8 to 10 in Seoul
SOUTH STRUCTURAL AXIS
Nova Curitiba
Av. Paraná
Represa Do Passaúna
DOWNTOWNMal. Floriano
Parque IguaçúGreen Line
Porto Alegre
Ponta Grossa
INDUSTRIAL DISTRICT
Parque Barigui
São Paulo
Curitiba’s Transit Oriented Development Source:Curitiba
16
Presenter
Presentation Notes
. Average densities in Curitiba are not high citywide, for example, but densities are high where they matter—along BRT corridors. Curitiba enjoys “articulated densities”—high densities in high-quality, transit-served corridors and the acquiescence to market-driven spread-out patterns of development in highway corridors.
TOD as Envisioned by Peter Calthorpe
A diagram of Peter Calthorpe’s vision for TOD
600meters
17
Presenter
Presentation Notes
As a reaction to American sprawl, TOD emerged as an explicit design strategy in California in the 1980s and 1990s. Peter Calthorpe designed the TOD strategy in order to create a framework for neighborhood-level developments that would be well connected to public transit. The image found on this slide shows a diagram of Calthorpe’s original TOD vision.
Expand Catchment Area by Various Transport Modes
18Mode Connectivity At Station
Source: S. Sakaki
Expand Catchment Area by Rail & Bus Connection
Source: Toyama City
RailBus
Catchment
Rail enjoys Economies of ScaleBus enjoys Economies of Scope
Toyama LRT & Bus Catchment Area
19
TOD in Tokyo Metropolitan Area
20 <Source :TOKYO2050 fibercity / JA63 / Hidetoshi Ono > ※Pink is the author's ideas
• Mega-Cities in Japan = Chains of Walkable Cells connected by Railways
• A network of 800m radius walk-able areas from each railway station in Tokyo Metropolitan Area
Presenter
Presentation Notes
In other parts of the world, TOD concepts have been practiced at much earlier times. This diagram shows how urban areas in Tokyo Metropolitan are well covered by the railway network. Major urban areas are conveniently covered by walkable distances from the stations. In the map, they are shown in a series of gray circles of 800m in radius. In addition to this, the public bus network is also well developed, connecting and supplementing this railway network. These public transit networks have been developed from as early as 1910 all through the 20th century. The Tokyo Metropolitan area was developed in conjunction with railway network construction. The governments developed the railway system before the wave of motorization reached Japan. In addition, during the fast-growing post-war period, railway companies were often leading developers, who combined railway extensions with building new communities on the metropolitan fringe. Image Source: Wataru Tanaka, Nikken Sekkei, Ltd based on the graphic of Tokyo 2050 fibertcity/JA63 of Hidetoshi Ono (NOTE: Suzuki is currently asking the authorization of Tanaka to use this slide. To be checked before the finalization).
Quality Increases Land Value of TOD Areas
Transit
Quality Urban Design Enhancing TODEfficient
Functional VC1
VC2
OV
Pleasant
Vibrant
VC3 Quality
Quantity: Vertical-Horizontal Expansion-
Transit Value
Original V
21
Land Value Premiums of TOD in U.S.
Station
Perc
ent I
ncre
ase
in L
and
Valu
e
Distance from Station
5
10
15
20
25
30
35
½ Mile 1 Mile¾ Mile¼ Mile
Land Value Premium in TODs
Station
Perc
ent I
ncre
ase
in L
and
Valu
e
Distance from Station
5
10
15
20
25
30
35
½ Mile 1 Mile¾ Mile¼ Mile
Land Value Premium in TODs
TOD: High Quality Pedestrian-Friendly Design
TOD: Low Quality Non Pedestrian-Friendly Design
Source: R. Cervero
Presenter
Presentation Notes
Theory says benefits of living near rail get capitalized into land values. Thus a good way to reflect benefits of TOD is to examine rent and land value premiums – often by comparing “comps” (similar projects except one is near and the other is not near transit).
• Node Value based on its location in the network
• Place Value based on its urban qualities
• Market Value, based on its economic potential
The “3V Frame WORK”
The 3V Framework (Serge Salat, Gerald Ollivier)23
Financing TOD with Land ValuesTax
Fairebox RevenuesLand Value Capture (LVC)
Scarcity & AffordabilityPolitical Economy
Economic Rational & Financial Viability
24
Transit is Capital Intensive
Tokyo Metro Construction Costs
Source: Hitoshi Ieda
Source: World Bank LVC Case Studies
$100MRMB 0.6 B
$200MRMB 1.2 B
$300MRMB 1.8 B
25
Cities CostBillion
LengthKm
Nanchang Line 2 $2.6 24Km
Hyderabad $2.6 72 Km
Delhi $11.7 120Km
Sao Paulo $30 .0 100Km
Metro in Developing Countries
Fare-box Recovery Ratio
Source: Murakami, Jin. 2012. Transit Value Capture
Fare Revenues/Operation Expenses (%) – 60 Global Cities
0
20
40
60
80
100
120
140
160
Hon
g K
ong
Del
hi
Tok
yo
Sing
apor
e
Lon
don
Bud
apes
t
Bar
celo
na
Cop
enha
gen
Ath
ens
Osl
o
Mad
rid
Hel
sink
i
Ham
burg
Mos
cow
Stoc
khol
m
New
Yor
k
Pari
s
Ber
lin
Bol
ogna
Chi
cago
Was
hing
ton,
DC
Lyo
ns
Rot
terd
am
Bos
ton
San
Fran
cisc
o
Am
ster
dam
Atla
nta
Los
Ang
eles
Port
land
Hou
ston
Mia
mi
Dal
las
Cross-subsidies
26
Focus of the WB’s New Book
Source: Suzuki, Murakami, Hong and Tamayose, 2014
Focusing on Development based Land Value Capture (DBLVC) practices in HKSAR and Tokyo as global best cases
Seeing DBLVC as a strategic model of both urban finance and planning
Discussing how to adapt DBLVC in cities of the developing world
27
Concept of Land Value Capture
Source: Adapted from Hong and Brubaker 2010. 28
Categories of LVC Instruments“Tax or Fee based” LVC & “Development-based” LVC (DBLVC) Instrument
Tax-
& F
ee-B
ased Property and Land Tax
Betterment Levies and Special AssessmentsTax Increment Financing (TIF)
Deve
lopm
ent-
Base
d
Land Sale or Land Lease Air Right SaleLand Readjustment
Urban Redevelopment Financing 29
Source: Suzuki, Murakami, Hong and Tamayose, 2014
Betterment Fees/Charges
30
Tax Incremental Financing (TIF) US
31
UC Real-estate Development Sireies
Challenges of Tax-Based Land Value Capture
• Nobody likes tax-Political Economic Problem;• Valuation Method;• Uncertainty • Question of Equity: TIF District and Other Districts;• Tax-Based Land Value Capture instruments are based on
Property Tax; and Collection system such as cadastral, which is not often well developed and managed
32
Underlying Principe of DBLVC
開発利益還元
Development Profit Return
VS
Land Value Capture33
LVC for Finance & Planning in TOD Transit Agency
Developers
Landholders
Other Agencies
Communities
Accessibility Density & Mixture Amenity Integration
Land Value Increment
“Synergetic Benefits to be Shared”
Railway Investment
Source: Jin Murakami 2013
“Urban Planning to Promote TOD” 34
Transit/TOD Investment-O&M Costs vsRevenues from Land Sale and Use and Others
CONSTRuCTION
O&M
Other TOD (Station Plaza, Pedestrian Facilities, etc.)
Other TOD O&M Tax & (Property Tax & Sales Tax) Fees (Betterment, Development)
Land Sale (land, land use, air or underground use right)
Property Mgt. & Commercial Revenues
Tariff
Transit(Guided ways, Rolling Stock, Stations)
Transit O& M
• Land Price Increase
• RidershipIncrease
• Business Increase
• Cost Recovery
CF +_ _+ _+
Advertisement
Fees
Fees
“Development” based LVC
“Tax or Fee” based LVC
35
COSTS REVENUES
Land Value Capture Global Good Practices: Schemes
and Instruments
36
Total Land Area
1,104 sq. kmUrban Area
261 sq. km
(23.6%)Population
7 millionUrban Density
26,700 people/sq. kmPrivate Vehicles
60/1,000 residents
Hong Kong
MTR is a “backbone” of Hong Kong’s urban developmentHong Kong’s “urban density” supports MTR’s ridership
J.Murakami37
HKSAR: R+P Program (1)
Sources: Based on Cervero and Murakami 2009.Note: MTR = mass transit railway.
38
HKSAR: R+P Mechanism (2)
Source: Based on Hong Kong SAR, China, Mass Transit Railway (MTR) route maps and other maps.Note: R+P = Rail Plus Property.
Early GenerationTin Hau Station (1989)Site Area…0.58 ha Residential… 61,000 sqm(72.9%)Commercial… 3,700 sqm(4.4%)Others… 19,000 sqm(22.7%)Parking… 650 lotsF.A.R… 14.43
J.Murakami
41
Integrated Development Package
Source: AL Stephan (2013)
Kowloon Station (1998-2010): 13.5 ha
42
Mass Transit IntegrationHow to Finance Massive Transit Investments?Explore Possible Land Value Capture Financing
43Hong Kong MTR’s Maritime Square Residential-Retail DevelopmentSource: Hong Kong MTR
Presenter
Presentation Notes
READ SLIDE ONLY Highlighted Areas
Recent GenerationTung Chung Station (1998)
Site Area… 21.7 haResidential… 935,910 sqm (90.8%)
Civic Space Provision & FAR Bonus(e.g., Case of Shinagawa Station Area)
4.0
FAR AssessmentBefore
(Industrial Site)
4.0
7.0
BaseFAR
After(Office Site)
Green Space, Underground Access Road & Pedestrian Network18,167 sq.m. Civic Open Space12,480 sq.m
+1.9
Joint Housing Provision35,433 sq.m.
+0.6
9.5
Example 3: Depot Redevelopment (3)
J.Murakami 58
59
HIKARIE Data
Consecutive Urban Redevelopments Through Restructuring Station-related Infrastructure
[Completion of construction] 2012 [Owner]Tokyu Corporation and others [Total floor area] 144,000㎡ approx.[Number of lines] 8 lines, 6 stations [Number of passengers] 3,000,000 persons per day approx.
Source: Nikken Sekkei Corp.
Example 4: Tokyu Shibuya Station District Redevelopment
Presenter
Presentation Notes
Shibuya is very famous as a cultural and entertainment core in Tokyo Downtown. About ten years ago, the comprehensive redevelopment plan of Shibuya stations and surrounding areas was started and the first new development was completed last year.
60
涩谷新文化街区
计划开发街区
Shibuya Station
Shibuya Station District Redevelopment
〔TOPIC-1〕Hub stations along Railroads Network
Inokashira Line
Yamanote Line
Source: Nikken Sekkei Corp.
Source: Nikken Sekkei Corp.
Presenter
Presentation Notes
Before going into redevelopment, I will briefly explain the station renovation plans. This is the condition of 5 years ago. Shibuya station is a group of several stations which belong to JR line, private sector lines, and the subway. �The fist motivation of redevelopment is that the station buildings in the center, which contains department store and some structure of railway stations is almost 80 years old, and was judged as non-resistant building against severe earthquakes. And the second motivation was the improvement of circulation systems among various stations and traffic modes. So, the government and railway sectors decided to shift some stations to the better location, restructure the whole transition system, and redevelop the new complex buildings to maximize the value of railway sectors’ properties. Firstly, new subway station of FUKUTOSHIN line was newly built under the street, and then TOKYU TOYOKO line terminal station was shifted and connected to this line. Secondly the station of GINZA line is now going to be replaced to the east, and then lastly, JR SAIKYO line station will be shifted to the north.
61Adopting “FAR Transfer System” to earn restoration costs
Win-Win Structure forBoth Public & PrivateFAR Seller & Buyer
Example 5 Tokyo Railway Renovation by Air Right Sale
Nanchang: Public Development Right Sale for New Metro Construction (1)
Suzuki, Murakami, Hong and Tamayose, 201462
Nanchang: Public Development Right Sale for New Metro Construction (2)
Suzuki, Murakami, Hong and Tamayose, 2014 63
14Hyderabad: Innovative PPP
Private Concessionaire : Min. Gap Fund Request Project Period of 35 years Property Development Rights
(25 Sites + 3 Depots)
Design-Build-Finance-Operate-Transfer (DBFOT)Project Revenues (est.):• Fare Box = 50% • Real Estate = 45%• Other = 5%
Gov. & Special Purpose Vehicle : Land Acquisition Statutory Clearances 10% Max. Gap Fund 300 m TOD zone
J.Murakami64
Source: Suzuki, Murakami, Hong and Tamayose, 201565
Critical Factors for Success of LVC in Developing Countries• Inclusive Land Value Capture: Aim at “Win Win” for All the Stakeholders, including urban poor in
the project area;• Sound planning principle based on Visionary Long-Term Master Plan;• Intergovernmental collaboration is must, especially at capital city.• Macro fundamental and regional economic growth is fundamental;• Public landownership is important, but not absolutely necessary;• Flexible zoning should be provided by the city planning authority;• Entrepreneurship is prompted by the transit agency (creating a real-estate development unit by
bringing in private business expertise and/or develop partnership with businesses);• Develop, clear, fair and transparent rules to prevent corruption;• Loan or other source of financing is still needed as bridge financing till LVC can materialize; and• LVC is not a silver bullet, explore multiple funding sources, hedging against real-estate market
risks
66
Conclusion.TOD which creates articulated densities around transit hubs by
locating amenities, employment, retail, and housing in close proximity—is one of the most effective ways to achieve sustainable urban development and to increase value.Collaborative efforts of national government, municipalities,
transit agencies, developers, landowners, and communities can maximize LVC premium. In this joint value-creating and sharing exercise, municipalities and transit agencies can contribute significantly to value creation either through zoning changes (FARs and land use) and through transit investment. The rapid population increase and robust economic growth in
rapidly growing cities in developing countries, particularly in middle-income countries, are certainly favorable for development-based LVC. 67
Land Value Capture Instrument (1)Land Readjustment Scheme
Sources: Murakami, 2010; Suzuki, Murakami, Hong and Tamayose, 201470
Stage 1Right of way
Acquired land
Project area
Stage 3New station
Commercial building
Park
Residential parcel
Stage 2Right of way
Assemblage
Application of Land Readjustment to Transit Project
Sources: Murakami, 2010; Suzuki, Murakami, Hong and Tamayose, 201471
72
To the Sea
To the Uphill
ShibuyaStationCentral
Shibuya HIKARIE ShibuyaSakuragaokaRedevelopment
ShibuyaDogenzakaRedevelopment.
Shibuya Station-south
④ Environment Conscious Development utilizing Natural Energy
Shibuya Station〔TOPIC-1〕Hub stations along Railroads Network
Conserving Wind Corridor and Creating Green-covered Roofs are two major guidelines for the Development
Source: Nikken Sekkei Corp.
Presenter
Presentation Notes
Within the overall master plan, creating green connection and conserving wind corridor are also key design factors within this heavily condensed urban environment.
Public & Private SectorAdvisory Committee
on Area Development (1996)
Started with 59 Private Landlords & Chiyoda City (now 68 PL & 21 Associates)
Redevelopment Project Council (1988)
Area Management Association(2002)
+ Tokyo Metropolitan Government
+ East Japan Railway+ Chiyoda City City Planning
Guidelines (2000)
Environmental Considerations
Association for CreatingSustainability in Development(2007)