California wants cities to build more housing near transit hubs. Can LA improve its track record on TOD?

Southern California faces two equally knotty challenges: how to improve housing affordability and how to reduce traffic congestion. State Senator Scott Wiener recently proposed a statewide Transit Zoning Bill, SB 827, which attempts to address both problems. He argues that cities should build more housing in taller buildings near major transit hubs. Weiner also argues that statewide intervention is necessary because cities have not done enough on their own to encourage compact, dense development near transit. Some critics are pushing back that development guidelines should be left to localities.

Our recent research shows that Los Angeles has had mixed success so far promoting transit-oriented development (TOD) around Metro stations. Recent media attention has focused on successful developments near the Expo Line extension to Santa Monica, but those stations are not representative of the Metro system overall. Understanding the mixed results and missed opportunities can help policymakers increase the impact of future rail investments.

We conducted case studies of physical development in five station neighborhoods along the Red, Purple, and Gold Lines. Two of these saw concentrated new housing near stations, because of strong property values, TOD-friendly zoning—and targeted government interventions. Three others have seen no nearby housing growth, due to weak property values, incompatible zoning, or both.

Policymakers should be clear about whether the primary goal of investing in rail infrastructure is to improve access to existing jobs and housing, or to stimulate new activity.

In one case, Metro used eminent domain to assemble land near the Hollywood/Vine station, resulting in a successful mixed-use project. Even with active government facilitation, project completion took over a decade. However, only a few miles away, weak housing demand has left the Vermont/Santa Monica station area virtually unchanged, despite TOD-friendly zoning.

Map: Hollywood (LA): eminent domain and 10 years = successful TOD development2018.02.20_metro_Hollywood_shutterstock_179716724Photo by Eric Broder Van Dyke via Shutterstock

New housing has boomed near the Pershing Square station in Downtown LA (DTLA). The neighborhood benefitted from the 1999 Adaptive Reuse Ordinance (ARO), which encouraged conversion of vacant commercial office buildings into apartments. Also in DTLA, the Civic Center station enjoys proximity to government offices and provides rich access to jobs. However, zoning limits development around the station to public facilities, effectively prohibiting TOD. The Highland Park station area is in a gentrifying real estate market, but the neighborhood’s complex, contradictory land use plans inhibit higher-density development.

Map: Civic Center (LA), job-rich neigjborhood, but zoning limits new developmentGoogle civic centerCivic Center, Los Angeles. Photo credit: Google Maps

Our research also found that stations have not consistently boosted employment nearby. Analyzing stations on the Red, Purple, and Gold Lines, we compared employment over time for station areas to a set of “control” areas: major road intersections in the same vicinity but not immediately adjacent to stations. The station neighborhoods had historically high employment density, but saw no job gains within five years after opening, relative to control areas. A few of the earliest stations saw larger employment gains within five to ten years after opening.

The inconsistency in housing and employment growth near Metro stations brings us back to the primary question: if LA’s leaders want to encourage TOD, what should they do differently?

First, mayors and other policymakers should be realistic about how quickly station neighborhoods can change. When stations open in already dense urban environments, new development happens slowly. Market factors such as fragmented land ownership and institutional barriers such as zoning can delay or deter redevelopment. Rail systems may deliver long-run benefits to the region but are not effective at short-run neighborhood stimulus.

Mayors and other policymakers should be realistic about how quickly station neighborhoods can change.

Second, supply does not create its own demand, either for transit itself or for land near stations. Even after decades of investment, passenger volume at most LA Metro stations is very low relative to other rail systems. Only seven percent of LA’s commuters use public transit, and only 10 percent of those take rail rather than buses. Even at Metro’s busiest stations, ridership is a fraction of that in metros such as San Francisco, Chicago, and Washington, D.C.

Third, getting zoning right is a necessary but not sufficient condition for TOD. Incompatible zoning that limits density too much may constrain housing and commercial development. But TOD-friendly zoning in the absence of a strong neighborhood real estate market will not induce new building.

Finally, the locations most likely to generate new development may not be the ones that are closest to existing job centers. Policymakers should be clear about whether the primary goal of investing in rail infrastructure is to improve access to existing jobs and housing, or to stimulate new activity.

Over the past 25 years, Los Angeles has spent a substantial sum of $9 billion—largely financed by local sales taxes—building Metro’s subway and light rail stations. So far, this public investment has generated fewer gains in housing supply or jobs than city leaders had hoped for. Perhaps more carrots and sticks from Sacramento would help.

About the authors

Jenny Schuetz is a David M. Rubenstein Fellow at the Brookings Institution’s Metropolitan Policy Program. Genevieve Giuliano is the Margaret and John Ferraro Chair in Effective Local Government and Director of the METRANS Transportation Center at the University of Southern California. Eun Jin Shin is an Assistant Professor at Yale-National University of Singapore. They are the authors of two new articles, “Can a Car-Centered City Become Transit Oriented?”, forthcoming in Cityscape, and “Does Zoning Help or Hinder Transit-Oriented (Re)Development?”, published in Urban Studies.