Western Canadian cities are typically characterized by extensive urban sprawl, manifesting low density development which makes it extremely challenging for city planners to put in place the public transit systems that are necessary to ensure the efficient operation of urban areas. These challenges, coupled with ongoing population and economic growth, require immediate attention. This paper explores one potential solution from the perspective of real estate and transit management. The focus is on how to achieve sound management of the interrelationship between transit planning and the optimal utilization of public land use entitlements. To facilitate the discussion, the paper presents several case studies that provide examples of both good and bad practices.
Public transit is of critical importance to a city’s development because it is an essential part that enables the functionality of an urban setting. In particular, inefficient transport systems incur extra costs to city residents and the government in terms of increased spending, higher taxes, and the loss of city competitiveness. Also, it causes environmental problems such as car exhaust, road congestion, and loss of green space. An efficient public transit system is increasingly viewed as one of the major competitive drivers for a city in the national and international arena. Hence, it is imperative for a city to develop efficient transit systems in accordance with sound city planning.
It is increasingly clear that in order to remain competitive, it is essential for a city to achieve sound transit system planning that goes hand-in-hand with progressive city planning. This means that community planning should not be conducted in a vacuum, but should be carried out in conjunction with transit planning at the very earliest stages. Specifically, city planners should be tasked with coordinating certain land use corridors to offer greater densities along the very same corridors being planned for future transit systems. In other words, planners should seek to optimize the operation of rapid transit systems by increasing ridership through the tailoring of housing and commercial forms towards mid-to-high density development. This not only offers substantial improvements to land use efficiency through densification, but also meets the goal of improving access to rapid transit and increasing ridership.
All three levels of Canadian government possess valuable entitlements that are related to transit infrastructure development and real estate planning. For discussion purposes, this paper provides an illustrative list of three options where government can leverage their entitlements to help shape the form of city growth (horizontal vs. vertical), optimize the relationship between land use planning and public transit systems and, at the same time, capitalize significant financial and non-financial rewards, particularly from real property assets. Furthermore, the paper discusses one particular impediment that exists in most western Canadian cities, namely the disconnect between different levels of government (municipalities, despite responsibility for planning, construction, and financing of municipal infrastructure, do not have the prerequisite enabling legislature to properly finance these undertakings), and provides suggestions as to how government can pursue means of constructing alternative institutional structures that facilitate the development of public transit infrastructure.
The paper provides observations and recommendations that, although not necessarily fit for each western Canadian city, serve to demonstrate the multitude of development opportunities that could be, or could have been, pursued by government and development parties. Specifically, these actions are explored under two scenarios that are considered applicable to most western Canadian cities: 1) planning for small cities or town centres that are not yet ready for rapid transit, but can significantly benefit from incorporating these systems into current planning initiatives; and 2) planning for municipalities that are already coping with inefficient transit systems and urban sprawl due to the historical lack of coordinated planning.
Of all the options and solutions discussed, the most profitable, yet also the most challenging, is for government development bodies to fully exploit their public sector entitlements for the purpose of achieving the proper planning of transit impact areas such as the incremental values of higher-order land uses, increased densities, and increased absorption rates. This paper explores different methods of pursuing these objectives, but essentially it involves the development parties acquiring, at the appropriate time and in the appropriate manner, those properties that would be expected to experience the highest growth in residual land values. Ideally, the properties to be affected would be acquired at the very earliest stage of project conceptualization (i.e., acquisition at “wholesale” value before the designation of public entitlements), followed by disposition of such properties on a systematically controlled and highly strategic fashion so as to maximize their residual value and minimize any risk exposure for the public sector.