U.S. Cities Vowed To Have More Mass Transit By 2020. Most Are Still Waiting.

Planners in many U.S. cities benchmarked 2020 as the year transit plans would get rolling down the tracks. 

Master plans and vision studies proclaimed regional transit networks would expand, easing congestion and efficiently zipping residents to and from their jobs and homes in growing metropolitan areas like Austin, Columbus and Nashville. 

Let’s Move Nashville was a nearly $9B plan to add light rail and bus rapid transit across Music City. Transit advocates hoped Project Connect would bring light rail to Austin, ranked the worst city in Texas for traffic congestion.

But 2020 is here and, despite booming economies, these cities aren’t any closer to solving their traffic misery — and that could threaten their growing real estate markets.

Infrastructure is the top issue facing the real estate industry, according to the most recent Counselors of Real Estate survey. As traffic gets worse in the country’s biggest cities, the most valuable real estate — and most ambitious developments — are the closest to rapid transit. 

In Boston, 80% of the office and lab leases over 100K SF in the last two years have been signed in buildings within a five-minute walk of a train station, according to data from local intelligence firm Perry. Nearly $3B of real estate development has taken place along Charlotte’s LYNX Blue Line light rail network since it first opened in 2007.  

Officials in other midsized cities have wanted in on the growth. But the task of building transit is far more challenging than planning for it. 

“There certainly isn’t an infrastructure surplus,” said Kenny McDonald, the president and chief economic officer at Ohio economic development organization One Columbus. “It’s one of the biggest, if not the biggest, economic issue metro areas are facing.”

Then-Mayor Michael Coleman pitched a downtown light rail network for Columbus, Ohio, in a 2006 State of the City address. That call for improved infrastructure was included in Columbus 2020, an economic plan to turn the 11-county region into “the most prosperous region in the United States.” 

Coleman's light rail network hasn’t progressed. The plan, and the economic development organization created to implement it, has been renamed One Columbus. 

The organization has pursued several transportation fixes, like a free downtown bus and private shuttles for some of the region’s largest employers. But a widespread infrastructure solution to keep up with growth is still elusive, McDonald said.

“I always say in presentations that, if we grew the same way we grew the last 10 years but our commutes get better, we will have done something that’s almost historically impossible,” he said. 

Partnership 2020, a Nashville Chamber of Commerce development initiative, called for addressing population growth and growing traffic concerns in Tennessee’s largest metropolitan area with regional transit.

A Koch brothers-led campaign against Amp, a planned seven-mile bus rapid transit network, led to its cancellation in 2015. Voters later rejected a transit referendum, something the Koch brother also opposed, in 2018.

Austin officials have made multiple attempts for improved transit in their city, ranked one of the worst cities in the U.S. for traffic. Two attempts have failed so far. 

Voters rejected a $1B, 15-mile light rail proposal in 2000. Project Connect, a $1.4B plan that used much of the original light rail plan as well as $400M for road improvements, failed in 2014. Austin’s CapMetro transit agency is currently proposing a $10B upgraded transit plan, which could get a vote this year.   

“Everything we do in transit is slow, inefficient and doesn’t take advantage of the latest technology, and I think citizens get that,” said Norm Anderson, the president and CEO at infrastructure advisory firm CG/LA Infrastructure. “Why would we approve this mess?”

Lengthy planning and approvals processes for U.S. transit networks drive costs up enormously when compared to systems abroad. Recent light rail systems in cities like Houston, Dallas and Portland cost between $100M and $200M per mile, while French light rail networks cost between $40M and $100M per mile, CityLab reports. 

“We should do a much better job coming up with a strong light rail solution that is clear and doesn’t have all sorts of add-on costs as you move on through the process so citizens can see something that gives them enormous value,” Anderson said. “If you were to go to Austin and tell people you can do this for $5B rather than $10B, they’d be a lot happier.”

The federal government has held off on approving funds for transit expansion and recommended local governments pay a bigger share in projects, according to transit advocacy group OpenPlans.

More than 70% of federal transportation grants have gone to road projects in the first three years of Donald Trump's presidency — double the allocation of the last two years of the Obama presidency. In that same time frame, the Obama administration allotted nearly 28% of federal transportation grants to mass transit. The Trump administration has put less than 9% toward transit. 

“The federal government does not play its role anymore,” Anderson said. “In fact, it plays a counter-role.”

There is also the uncertainty in whether a multibillion-dollar transit network is worth it, as carpooling in an Uber or Lyft theoretically takes cars off the road using existing resources over costly train cars. 

"One of the biggest problems is that there is such little operational data out there for U.S. networks that it becomes a 'believe me' system in selling this $10B thing," Anderson said, in reference to Austin's third transit proposal.

Charlotte is still rolling forward with its own transit expansion, despite the financing headwind. 

After opening the Blue Line in 2007, the Charlotte Area Transit System doubled the length of the transit line in 2018 to 19.3 miles. The transit agency is at work on a downtown streetcar system dubbed the Gold Line. Charlotte officials have also commissioned studies for the Lynx Silver Line, an east-west light rail line that would run from Uptown Charlotte to Charlotte-Douglas International Airport and suburbs to the west.  

“For us, transit is a must,” said Michael Smith, president and CEO of economic development organization Charlotte Center City Partners. “What we’ve seen is we were not a great target for institutional investors until we committed to this mass transit system. After that, institutional investors and underwriters from around the world began visiting.” 

Fueled by $3B in transit-oriented development along the Blue Line, the Charlotte region’s economy grew by 34% between the year the transit line began service through the end of 2018, according to U.S. Bureau of Economic Analysis figures.

Smith pegs the economic success to the railway, as companies with a younger workforce see Charlotte as a place where they can have a similar car-free lifestyle without the expensive cost of living of bigger markets like New York City or San Francisco.  

“If you think about it, it sets a whole engine in motion and says what kind of city you want to be,” Smith said. “Look at today and tomorrow’s talent, and they’re looking at places that are bikeable, walkable and transit-oriented.”