Executive Summary. Does a Streetcar Make Sense in Anaheim

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1 Does a Streetcar Make Sense in Anaheim Streetcar in Portland s Pearl District Anaheim s proposed streetcar compares well with national best practice in Portland, Seattle and Tampa where new streetcars have helped to transform the areas along their routes. Executive Summary The City of Anaheim has completed an Alternatives Analysis (AA) for the Anaheim Rapid Connection (ARC) fixed-guideway project and selected a streetcar as the locally preferred alternative. Compared to the enhanced bus alternative evaluated in the AA the streetcar is expected to attract more riders, provide more certainty for businesses and visitors, promote livable communities and result in major economic returns. 1 Anaheim s streetcar corridor can expect to see a doubling of development with the project an additional 3.4 to 10 million square feet 75% would occur within 1/8 th mile of the streetcar line 1 Orange County Transportation Authority, Anaheim Rapid Connection Locally Preferred Alternative, City of Anaheim PowerPoint ( June 24, 2013). 3

2 Development & Economic Impact E. D. Hovee & Company, LLC The Anaheim/Orange Visitors and Convention Bureau secured the services of GB Place Making and E.D. Hovee Company to answer two broad questions: Anaheim will become smaller & better connected with the addition of a streetcar the Convention Center, Disneyland, Angels Stadium and ARTIC will become steps apart 1. Provide an objective assessment of the overall economic benefits of a streetcar system to Anaheim and Orange County in comparision with enhanced bus service. 2. Provide detailed case studies of similar operating streetcar systems addressing economic impact, and 'best practices' and lessons learned. And compare streetcar experience with enhanced buses. In answering those questions this study has strived to complete a balanced objective look at the actual experience on the ground with land use and economic development for streetcars and enhanced bus, and to apply that experience to understand what can reasonably be expected in Anaheim. Anaheim Well Suited for a Streetcar Line Anaheim s proposed streetcar will connect with regional rail (Metrolink and Amtrak) at the Anaheim Regional Transportation Intermodal Center (ARTIC), which is under construction and will be open in The streetcar will also act as an urban circulator serving short trips to synergistic activity centers along the line. With the addition of a streetcar Anaheim will become smaller and more integrated the Convention Center, Disneyland, Angels Stadium and ARTIC will become steps apart providing benefits well beyond the City of Anaheim. Many of the key characteristics of the Portland, Seattle and Tampa streetcar projects can be found along the Anaheim streetcar. Like Anaheim, each streetcar corridor connected the unconnected shortening the distance between places; opened up substantial amounts of underutilized land for development; and each streetcar city had planned for intensive walkable mixed use development along their line. Like Anaheim, the Portland and Tampa streetcars serve convention centers and tourist destinations. Like Seattle, the Anaheim Streetcar offers the opportunity to serve and catalyze major new centers of employment. And like Anaheim, the Portland Streetcar serves a major league sports complex. 4

3 Does a Streetcar Make Sense in Anaheim How do Streetcars and Buses Stack-up? Different modes perform in different ways. And they have different economic development implications. The trick is to match the appropriate mode with the corridor for shaping land use and addressing transportation needs. Enhanced bus and streetcars are ideally suited to different kinds of transportation corridors: Anaheim s streetcar shares key characteristics with streetcars in Portland, Seattle & Tampa: connecting the unconnected; planning for mixed-use along the line; opening underutilized land for development; serving convention centers, tourist destinations & major league sports Enhanced Bus / BRT systems serve as excellent regional connectors, speeding large numbers of people to and from the downtown area. BRT is ideally suited to serving longer trips in lower density corridors where greater station spacing and flexibility of service is important. Streetcars are a connecting mode for circulation connecting riders to major destinations and local circulation within downtown and its destinations. Streetcars are ideally suited to serving short trips serving a number of key activities in a walkable urban environment. Development Experience with Streetcars & Buses The Portland, Seattle and Tampa case studies illustrate how streetcars have been a powerful community building tool when they are linked with a vision for the future, an expanding real estate market, strong leadership and supportive planning and zoning. Unlike streetcars, development shaped by buses has been the exception not the rule. When it does happen it is smaller and requires more effort than with rail. 5 Portland Streetcar a Development Tool: As a development stimulus, the streetcar has been a resounding success. By 2008, private developers had invested $3.5 billion within two blocks of the alignment, including over 10,000 new housing units and 5.4 million square feet of office, institutional, retail and hotel construction. Along the second line over $1 billion in new projects are underway with another $500 million committed.

4 Development & Economic Impact Seattle Streetcar Extended Downtown: The biggest impact of the streetcar has been in changing the shape of Seattle s office core. Since the streetcar project opened in 2007 the area along the route has experienced $3.2 billion in new development. In addition Amazon.com s new $1.16 billion headquarters will include a trio of 38 story towers along the route. Minneapolis Post Seattle Streetcar. The shape of Seattle s downtown has expanded following the streetcar into South Lake Union now home to Amazon.com and the Bill and Melinda Gates Foundation. Tampa Streetcar Tourist Line + Development: Tampa s tourist line had the side benefit of opening up an industrial waterfront district for development. Total investment associated with the streetcar is estimated to approach $1 billion as of Nearly 2,500 dwelling units were completed or under construction in the downtown/channel District, with another 5,500 dwelling units still planned. Anaheim Streetcar Economic Analysis The economic development analysis conducted with this report draws on the case study experience in addressing three related questions: How much development can be expected in proximity to the alignment of the Anaheim Streetcar if no streetcar is built? How much added development might be expected by building the Anaheim streetcar? What added property value would be assoicated with and without the streetcar? And what is potential for incremental property tax revenues? E. D. Hovee & Company, LLC 6

5 Does a Streetcar Make Sense in Anaheim Underdeveloped Corridor Prime for Redevelopment Much like the experience in Portland, Seattle and Tampa the Anaheim Streetcar corridor is a prime candidate for the redevelopment envisioned in existing plans. A considerable inventory of land that could be considered ready for redevelopment remains in the corridor. In fact, some 45% of the 400 acres suitable for commercial, residential and mixed-use is relatively low value and just 17% of the build out allowed under existing plans and policies has been achieved. City of Anaheim As has occurred elsewhere, streetcar implementation in Anaheim can be expected to serve as an incentive for increased density of development, more mixed use and a more rapid pace of development than would otherwise occur. Given the mix of existing uses and planned projects in Anaheim, the streetcar could prove particularly instrumental to kick-start renewed hotel development (per adopted plans) plus add further impetus to housing, office and supportive retail development. 7

6 Development & Economic Impact Doubling of Development with Anaheim Streetcar City of Anaheim and E. D. Hovee & Company, LLC. Streetcar Bonus: Potential to Double Development. The corridor can expect to see a doubling of development with the streetcar as much as 10+ million square feet 75% would occur within 1/8 th mile of the streetcar. The analysis shows a potential doubling of development over the period as compared with what might be expected under base case (without streetcar conditions). Potential for as much as 10+ million square feet of development over this 10-year forecast horizon (with the high range estimate) The forecast is consistent with results documented for pre- and poststreetcar development experience in Portland, Tampa and Seattle. E. D. Hovee & Company, LLC 8

7 Does a Streetcar Make Sense in Anaheim Incremental Property Valuation & Tax Revenues City of Anaheim and E. D. Hovee & Company, LLC. Up to $2.4 Billion in Added Value with Anaheim Streetcar. The streetcar incremental increased land valuation could exceed the base case potential by 2.6 times at current rates an added annual property tax value of $25 million in Consistent with the development projections, anticipated increases in property values and associated property tax revenues to benefitted tax jurisdictions were projected. As illustrated by the above graph, there is potential for substantial added assessed valuation: Ranging from an estimated $900 million with high range base case conditions to as much as an added $2.4 billion with streetcar. Leveraging with streetcar valuations that could exceed 2.6 times the base case potentials by Additional investment in theme park and other major destination attractors could add further potential to what is indicated above. Streetcar operation could both serve and facilitate this added destination investment. 9

8 Development & Economic Impact At current property tax rates, added assessed valuation with streetcar could be expected to yield annual property tax revenues of up to $25 million by Assuming an even pace of development each year, cumulative property tax revenues realized from may reach as much as $128 million above current property tax receipts from within the affected streetcar benefit area. Conclusion The proposed Anaheim streetcar mirrors the characteristics for transportation and economic development found with successful streetcars in Portland, Seattle and Tampa. The Anaheim streetcar can be a catalyst for the planned transformational change in the under developed 1000 acre corridor: Anaheim s streetcar can be expected to serve as an incentive for increased density of development, more mixed use and a more rapid pace of development than would otherwise occur The corridor can expect to see a doubling of development with the streetcar an additional 4.3 to 10 million square feet from % of which would occur within 1/8 th mile of the streetcar. The up to $2.4 billion in incremental increased land valuation with the streetcar translates at current rates into added annual property tax value of $25 million in Anaheim will become smaller and more integrated the Convention Center, Disneyland, Angels Stadium and ARTIC will become steps apart providing benefits well beyond the City of Anaheim. E. D. Hovee & Company, LLC 10