Evaluating the Capitalization Effects of Metra Commuter Rail Transit Upon Land Values in the Suburban Chicago Municipality of Arlington Heights: A Tale of Two Stations

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  • February 28, 2019
Creator
  • Chaney, Helen
    • Affiliation: College of Arts and Sciences, Department of City and Regional Planning
Abstract
  • The following report examines the capitalization impacts of transit-oriented development of Metra commuter rail stations upon land values in the Chicago metropolitan region. Transit-oriented development (TOD)--the practice of locating a mixed-use, high-density development surrounding transit hubs--is based upon the belief that accessibility to transit and compact land development can help to encourage the viability of public transit while also improving livability. By employing a hedonic price model designed to evaluate accessibility benefits, the research determines the extent to which preferences for transit-oriented development have been capitalized into the cost of land as compared with the capitalization effects associated with proximity to rail transit involving a conventional development pattern. The analysis employs data on the sales prices of single-family homes and townhomes within a one and a half mile radius of Metra commuter rail stations. Within recent years, numerous Metra commuter rail stations have been renovated for transit-oriented development. In most cases, the municipality has worked together with the development community to invest in the renovations necessary to allow for commercial, residential and retail vendors to establish themselves in the stations, drawing primarily upon redevelopment grants. The empirical evidence of increased capitalization effects due to transit-oriented development reveals the ability of transit-oriented development to act as a tool for recapturing some of the value that transit investments create in the form of tax revenue. Whereas previous studies have focused upon the prices of single-family homes, this study examines the capitalization effects resulting from both single-family homes and townhomes. The inclusion of townhomes as units of analysis is crucial, considering that much of the new development that has emerged in close proximity to the Metra stations over the past several years has been of the townhome variety. Significant growth has been planned for the Metra commuter rail system in the coming years. Serious opposition to the extension has surfaced, focusing upon the potentially harmful impacts that commuter rail service could have upon property owners in the form of reduced land value, resulting in costly delays to plans for implementation. This study will serve to inform the debate by shedding light upon the real versus the perceived effects of commuter rail upon property values.
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  • In Copyright
Advisor
  • Rodriguez, Daniel
Degree
  • Master of City and Regional Planning
Degree granting institution
  • University of North Carolina at Chapel Hill
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Location
  • Village of Arlington Heights, Illinois, United States
Extent
  • 26 p.
Access right
  • Open access
Date uploaded
  • December 10, 2010

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