How would you like to live above a train? At Del Mar Station in Pasadena, California you can certainly give it a try.
In the early 2000s, a few clever developers and architects convinced the Pasadena city council to build 350 apartments adjacent to L.A. Metro’s Gold Line light rail train. The existing existing park-and-ride lot spaces went underground, joined by even more parking for future residents. In its place, three tall stucco buildings in various shades of peach, wrap around the railroad tracks. A large rail station sits in the middle of a plaza with shops, restaurants, and a fountain. Instead of amenities orienting toward the street, everything here points inward to the train station.
A goal of these transit-oriented developments (T.O.D.) is to make rail so easy, residents feel comfortable to abandon their cars entirely. When I drove through the garage on a Monday afternoon, I was pleasantly struck by how empty the underground lot was. It seemed like nearly everyone at Del Mar Station embraced the convenience of transit.
“Oh no, I got [a car] in the garage,” resident Nick said, after recognizing me filming exterior shots of the apartment along Del Mar Avenue. “I used to live in San Francisco. I moved here and after about a year and a half I said, ‘I got to get a car.’ So I put the bike on the wall and got a car.”
Del Mar Station is a quiet game changer for hundreds of Pasadena residents. The mid-20th century construction boom gobbled up the city’s few vacant lots. A developer would struggle to find a place to squeeze in 350 new houses, let alone 350 new conventional apartments. Without the creativity of shoving so many households above a train station, Nick — or another person elsewhere he’d displace — wouldn’t find space to live in Pasadena at all.
The west coast is a great place to live— if you have a place to live.
“California’s inability to address housing is actually affecting the whole west,” said Ted Knowlton, deputy director of the Wasatch Front Regional Council. The quasi-government agency is grappling with how to plan transportation projects for the exploding population surrounding Salt Lake City.
Communities in Utah, along with Boise, Denver, Las Vegas, Austin, and Phoenix, have all become popular escape plans for west coasters fleeing high rents. But lately there’s been a problem. A few too many transplants are taking these cities up the offer. Home buyers are flooding the market faster developers can find far-flung lots to build on.
“We’ve always been a bargain compared to Denver. Even that gap has shrunk,” Knowlton told me. “The west is a popular place to live with a lot of growth.”
Since the end of World War II, cities in the U.S. have followed a common formula. When a city runs out of room for cheap build-ready lots, new freeways carve into empty fields on the periphery. Development surrounds the new highway until all lots (or all easy lots) fill up. Then the cycle repeats.
Rural opposition, environmental problems, and lawsuits have slowed this process to a crawl. Roadways have to stretch increasingly farther to reach remaining greenfield areas. In Southern California, the distant suburbs of the San Fernando Valley (1960s), Glendora (1970s), Santa Clarita (1980s), etc. — now make way for communities which are closer to Palm Springs than they are job centers in Los Angeles and Orange County. Public appetite for new highway construction in California is at an all-time low.
Is it any wonder few build-ready lots ever make it to market?
Planners from the blue ‘burbs of the Bay Area to the ruby red halls of the Utah Legislature are exploring ways to extract maximum value from existing lots in the city. In Southern California, planners call it a “two-percent strategy” — one where, hopefully, one-third of new development could occupy just 2% of the land.
“Let’s identify the most strategic locations for more housing development,” Knowlton said. “If 3% of [our] land could accommodate one-third of the housing, the benefits would ripple.”
Clustering housing uses less land. That should translate to lower rents and cheaper condo prices. And it hasn’t worked, because no matter how dense developers made it, it’s never going to be affordable when it sits on some of the most expensive land in the region. Downtown.
Dense urban development always sits in expensive city centers. That’s where transportation infrastructure is robust enough to handle hundreds of residents coming and going from a single location, generally on foot. Suburbs require residents to own cars. Hundreds of cars departing from a single parking garage stirs the ire of adjacent single-house residents.
There’s another form of transportation which unlocks land—
Suburban rail stations are set up to move far more people than any of them do. The land they occupy is cheap enough to hold a sea of asphalt surface parking. The hundreds of people who exit the train each afternoon generally walk to a parked car and leave. It’s really an under-used development site.
Transit-oriented development offers stores, public services, and “town center” features (fountains, benches, outdoor dining) within the quarter-mile circle train passengers are comfortable walking. Park-and-ride lots have a very high opportunity cost compared to the engagement potential each station offers.
Likewise, developing hundreds of housing units within the walk-able circle, pushes customers onto underused regional rail systems. It’s not a conspiracy to “re-engineering” suburbs. It’s extracting value from infrastructure we’ve already paid for. And in a seemingly counterintuitive way, could slow density from entering existing single-family neighborhoods.
“Significant density in a very small area is the exact same as a pinch of density across a really big area,” Knowlton said. “Nobody is going to say ‘yes’ to density everywhere. Certainly not in Utah. [Transit-oriented development] helps us in turn say ‘no’ to density in the areas that aren’t [these] centers.”
It’s difficult not to shake a feeling that transit-oriented developments will become yet another playground for rich yuppies, who already seem to have first-pick at urban, suburban, and rural living.
“It’s a challenge that we’re all trying to address. Find ways to provide more housing at lower price points that can meet and serve a huge and growing segment of the market,” said Derek Wyatt, of RCLCO Real Estate Advisors, a company which advises developers on profitability of new projects.
Wyatt and his consulting firm researched the interaction transit has on rent prices. When you measure apartments cost per square foot, the measuring tool developers care about most, there’s a 59% premium on rents where transportation is excellent. People pay more to be near nice things.
“In most cases, those transit-oriented developments tend to achieve premiums and top of market rents,” he told me.
This does not bode well for those of us in the “missing middle” who are too poor to afford most new market-rate projects, but make far too much to qualify for subsidized public housing.
Well, maybe not quite.
“Rents might be higher but the trade-offs, relative to what they’re spending for on transportation, might make it become a more affordable and attractive option,” Wyatt said.
When a development has such great public transit, a resident may opt to get rid of one or both their cars. Subtract the payment, insurance, gas, and maintenance, from the rent price — and in some cases, a household may come out ahead.
“Developers are getting creative on exactly how to kind of address some of those issues,” he told me. “I think one unique instance, and we definitely see this in more transit-oriented developments, is the growth of the co-living product type. Where you’re building much larger unit types and renting them by the bed, as opposed to by the unit.”
These “dormitory”-style projects may be pricey per square foot, but cheaper overall because non-traditional renters may only need to rent a small amount of square footage — bed, TV, and bathroom. These single-room occupancy (S.R.O.) apartments — made famous by slapstick Murphy beds comedy shtick in old black-and-white films — are slightly smaller than a studio. An affordable roof for the poor, recently homeless, and young singles nearly vanished because of strict urban policies since the 1950s.
America’s mono-culture of providing only car-dependent suburban single-family or “complex” apartments has served most of the population fairly well, who demand that type of housing. However, it’s left a not insignificant number of Americans deeply undeserved: the elderly (who can’t drive), the disabled (who can’t drive), and the stressed-out (who don’t want to drive)…
Objectively, it’s kind of mean that we require 99% of Americans to drive — just to buy a loaf of bread. We unintentionally make captives of this underserved non-driving minority. Imagine how liberating it would feel for an 80-year-old to walk independently to the store after surrendering their driver license?
S.R.O.s and other types of transit-oriented living may not appeal to most traditional buyers. Developers are going to have to get very creative to woo my child-rearing peers who, thanks to work-from-home employment, are hungrily eyeing far-flung edge development with backyards. But as we cater to more non-traditional renters who can live by suburban rail station, it’ll free up more conventional units for conventional renters.
Transit-oriented development is still really limited, but a future wave of new construction may help developers find ways to really maximize value and bring the price down.