Transit-Oriented Development: A Once Emerging Trend That's Becoming Mainstream

TOD's have the potential to solve many problems facing communities such as pollution, congestion, income constraints, and access to a quality workforce.

As part of our ongoing real estate market analysis work for several communities, we've been digging into trends around Transit Oriented Development (TOD) and thought we'd share some of our findings. 

What is TOD?

As millennials increasingly contribute to a dominant portion of the working population, developers are tailoring projects to their preferences surrounding convenience, walkability, and health. Many communities have shifted land use approaches to emphasize access to transportation, and encourage diversity and densification, particularly around main streets and urban cores. Together, these trends are driving the increased focus on Transit Oriented Development.

The purpose of Transit Oriented Development (TOD) is to increase access to public transit for a broader base of commuters and to create convenience to a wide array of amenities and services. TOD involves the formation of a dense, central location for a mix of uses, including residential as well as office and retail, with immediate proximity to a transit station.

These dense centers allow residents to commute to work, run errands, and enjoy social activities without ever getting into a car. TODs have the potential to solve many problems facing communities such as pollution, congestion, income constraints, and access to a quality workforce.

The planning process for TOD is complex, and there are many things to consider. Guidelines created by the Metropolitan Atlanta Rapid Transit Authority (MARTA) identified four core elements that are essential to TOD. These elements are:

  1. Dense station area relative to surroundings;
  2. A variety of uses that create a “24/7” place;
  3. A safe, attractive, and walkable public realm; and
  4. An unconventional approach to parking design.

Finding the correct balance of these four elements will vary based on the unique characteristics of the host city or town. The most defining of these characteristics being the location’s density.

Are there different types of TODs?

Density of the TOD is of utmost importance because too much density can worsen congestion, but too little will not attract the ridership base needed for success. Ideal density for the TOD depends on the density of the surrounding area, and on the type of transit station that will be utilized within the TOD. MARTA outlines seven TOD categories that determine ideal density, and ultimately, recommend developmental uses for a successful TOD:

  • Urban Core is usually at the very center of a major metropolitan area and has an existing high volume of people. As one may expect, urban cores have high-rise residential and office buildings, and offer a wide range of amenities such as lodging, retail, and space for civic engagements. Proven safety for pedestrians is critical in the success of an urban core TOD.
  • Town Center also has a rich pedestrian base, but may be similar to a historic downtown, incorporating landmarks and interesting architecture. Mid-rise construction is typical for a town center and residential units will be a large part of these developments.
  • Commuter Town Centers are “capture points,” usually immediately in proximity to an interstate, where commuters transfer to rapid transit from other forms of transportation, such as cars or buses. These centers require substantial park-and-ride capacity. Developments often include vertical mixed-use units, consisting of residential, office, retail, entertainment, and civic uses.
  • Neighborhood Centers are transit stations integrated into a residential landscape. High density is only suitable for the immediate surrounding area, after which density tapers off to blend with the existing landscape of the area. Neighborhood retail coupled with eating establishments and service-based office spaces are appropriate for the "main street" area.
  • Arterial Corridors contain smaller, dispersed transit stations located on high-traffic roads. These corridors typically have a suburban feel with less dense multifamily residential and mixed-use developments.
  • Special Regional Destination is a transit station area tailored specifically to one particular use, such as a hospital, industrial or office complex, or entertainment venue. The destination may include transit development local to the complex, depending on its size.
  • Collector is a transition area for drivers that usually include a large park-and-ride and a small station that provides access to more central stations. These developments do not usually contain any type of dense mixed use; rather, stations may be surrounded by warehouses or distribution centers. These areas require multiple means of access such as park-and-rides, feeder buses, taxis, and bike paths.

Though these general categorizations exist to guide decision-making, each TOD site is different. Careful planning and public engagement must be significant components of the development process. Additionally, it is important to recognize and prepare for TOD’s evolution over a significant period. See the Station Typology Matrix created by MARTA at the end of this article for additional detail on types of TOD.

Which uses work in TODs?

TODs create a great opportunity for a mix of housing types, as they appeal to a range of different people from highly-paid workers, to senior citizens, to disabled. Thus, TODs should strive to offer both luxury and affordable housing options in their developments and appeal to all price points. This range creates a diverse consumer base to appeal to in terms of designing the landscape of amenities and retail offerings. Types of businesses to target for TOD include:

  • Small boutique shops and retail under 20,000 square feet
  • Grocery stores
  • Movie theatres
  • Banks
  • Restaurants
  • Offices
  • Child care centers
  • Multifamily residential
  • Live-work space
  • Entertainment and cultural space
  • Civic or community meeting space
  • Bed and breakfasts or lodging with under 250 rooms

What uses don’t belong in TODs?

Though TODs revolve largely around the creation of density, it is also important to create a sense of place by incorporating pocket parks, outdoor seating and visiting areas, and shelters for those awaiting transit. These developments are pedestrian-oriented, as they are designed to alleviate the need for residents to own a car. A mix of the aforementioned businesses, coupled with proper streetscaping and open-space planning, will enhance walkability that attracts pedestrian traffic and encourage consumer spending. However, there are certain businesses that should not be a part of TOD due to the large amount of space they require. Types of uses and businesses to avoid for TOD include:

  • Strip malls
  • Car dealerships, washes, or storage
  • Big-box retailers
  • Equipment sales or rental
  • Commercial parking garages
  • Gas stations
  • Drive thru’s
  • Single family homes
  • Storage facilities

Many of these establishments encourage visitation by car such as drive thru's and gas stations and this would contradict the objectives of the TOD to relieve an area of traffic congestion and pollution.

What are the benefits of TOD?

Though the planning and implementation process for TODs may seem costly from both a financial perspective and an often a political perspective, TODs have many long-term benefits for communities:

  • Increased Disposable Income  |  Relieving residents of the expense of owning and operating a vehicle generates availability of disposable income, which is then spent in the TOD center.
  • Little Impact to Public School System  |  Despite the fact that dense residential developments would seemingly put strain on public school systems, those that choose to live in TODs are usually smaller household sizes; thus having little to no impact on cost to public schools.
  • Lower Infrastructure Costs  |  TOD lessens costs of infrastructure by eliminating the need for expansive utilities that would be required for sprawling suburban development.
  • Environmental Sustainability  |  TOD reduces land area needed for development and, because it generates less traffic than other development types, has a positive effect on air quality.
  • Creates Market Demand  |  Economic productivity is heightened by increased concentration of residents, businesses, and workers due to greater market concentration and intensified competition.
  • Attract Talent and Innovative Firms  |  Companies looking for top-talent are increasingly seeking areas with strong TOD assets and amenities.

Where can I find more information on trends in TOD?

As the trend of increasing use of TOD continues to grow throughout our nation’s urban centers, we encourage economic developers and community leaders to read up on the do’s and dont's of TOD. Check out our list of sources below for some recent success stories.


MARTA Station Typology Matrix:

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