tod news

MARTA ramps up its transit oriented development program at the right time
Andrew Tate | Atlanta Business Chronicle

 

MARTA's new pedestrian bridge in Buckhead. Two apartment towers and an office building are under construction around the station.

MARTA’s latest announcement of its intent to allow developers to build “vibrant, mixed-use Transit Oriented Development” above the North Avenue, Midtown, Arts Center, and Lenox stations feels exhaustingly overdue.

 

Thanks to MARTA’s leadership and concentrated efforts by a handful of smart growth organizations over the past three years, the ball is finally teed up for transit-oriented development (TOD) along the Peachtree Corridor. The decision to consider 99-year ground leases with developers—or possibly the air rights in fee simple—while bafflingly late in their legacy as owners is a savvy business move.

 

It’s also arguably made at precisely the right time.

 

Atlanta’s intown submarkets continue to mirror urbanization trends across the county as creative class tenants (and a few owners) are drawn to walkability, proximity to work, and cultural density. Midtown and Buckhead are the strongest submarkets in metro Atlanta, with multifamily continuing to outperform every sector.

 

Midtown’s apartment rent growth is a 7 percent — 40 basis points higher than the Atlanta market average, according to a report by Reis, Inc. Looking at these numbers—combined with recent decisions by several companies to relocate intown—perhaps it is best that MARTA has waited until now. Among MARTA’s stated goals are to reinforce the stations as “regional destinations which are highly desirable places to live, work and/or play,” to increase ridership by promoting increased pedestrian activity between the developments and the stations, and to generate revenue.

 

While the last goal is imminent, the first two depend on design for end-users. Consider Lindbergh City Center. Its under-performance is due not only to its awkward placement between Midtown and Buckhead and its less than visionary tenant selection, but also to its design. MARTA and developers should work together to place retail closer to the riders, thereby making the choice to linger for a cocktail, a little grocery shopping, or dinner, an easy one.

 

Gratefully, unlike Lindbergh, each of the four stations in the Request for Expressions of Interest (RFEI) are surrounded by a dense mix of high-volume uses, and this will aid MARTA’s end goals this time. Indeed, the reciprocity of development and the transit cannot be overemphasized. The development needs high performing transit and the transit needs development with high quality daily value and a sense of place.

 

The good news for future TOD in Atlanta is that MARTA’s peak hour weekday headways are shortening, thereby creating more value for developers who build around or on top of rail stations. Developers are also designing or repositioning properties more and more for the end user’s experience.

 

Since North American Properties took the helm at Atlantic Station, for example, the changes have been monumentally focused on responding to Midtown residents’ concerns and desires, and the majority of retail leases are in the process of flipping to local restaurants and creative class-focused retailers.

 

Jamestown has made end-user experience their development mantra, and their product is consistently authentic and successful at creating high cap rates despite the immense capital injection up front. The youthful character of their office tenants is telling as well. Imagine if Ponce City Market sat on top of the North Avenue or Five Points stations. With Underground Atlanta’s imminent sale, who’s to say what’s possible?

 

MARTA’s new TOD program has the potential to bring that kind of transformative development.