SunRail Start-Up: Early Returns

Afternoon Train Arrives at the Winter Park Station,

 May 14, 2014

Hundreds await the northbound train in downtown Winter Park

Central Florida's new $1.2 billion commuter train service, SunRail, officially began operating May 1st.  For the first two weeks the service was free.  Ridership was exceeded expectation by more than double averaging over 10,000 daily passengers and causing some afternoon trains to experience delays of 40 to 60 minutes.  

Serious commuters were not at all pleased as the trains quickly filled with joy riders intent on simply enjoying a free train ride to those looking to make a leisurely day out of the opportunity including many retirees and mothers with lots of kids.  

Perhaps the City benefiting the most from this initial start-up period  was the City of Winter Park, where downtown restaurant saw a remarkably significant increase in  business.  Bosphorous Turkish Cuisine put the increase at over 20% for their lunch crowd.  

Take Aways

It's too early to tell whether or not the ridership will continue to exceed expectations for the system predicted at 4,300 riders per day, but clearly SunRail accomplished its initial goal of getting people to try the train with its two weeks of free train service.  The excessive delays caused by the  high levels of ridership may cause some commuters to adopt a wait and see approach.  One commuter told me she had to wait over an hour for the train to return home from her long work day at Florida Hospital and while she wasn't willing to do that again, she noted that she was willing to try it again after the free ride period ended.  

Clearly one gets the sense that this new rail start is quickly being accepted as a viable and affordable alternative to being held hostage along Interstate 4 and even with delays, it certainly is more convenient and more enjoyable a commute than driving in rush hour traffic.  Scheduling bugs will be worked out and as I-4 undergoes a 10-year road expansion plan, prognosis for Central Florida's commuter train looks promising.       

Investment Based Planning -- A New Model for Developing Public Land Assets

All too often we see local governments, desperate for economic develop, putting their land assets out to the private sector in an RFP or RFQ without fully understanding their value or without full understanding of private sector drivers. 

The Investment-Based Planning Strategy is a new breakout method for local governments to grow private investment in the new economy. The paradigm works in delivering to local government, highly qualified private developers under a public-private partnership (P3) umbrella due to an innovative process employed.  Success is accomplished through a two-tier method beginning with a high-level macro assessment using big data trends followed by a parcel-based (micro) value capture process.  Key to successful deliverance is our unique ability to involve financial underwriters in the review of the value proposition.  Their involvement results in increased value for the land asset as developers turn from “being pursued” to pursuing the opportunity.  In essence, the resulting development plan and agreement reflect a "visual financial proforma" versus a "pretty picture." The paradigm has worked in a number of situations and communities from regional airports, and suburban TOD locations to catalytic sites for downtown redevelopment and suburban sites where placemaking and new economic development strategies are imperative.  

While already successfully applied in a number of Florida communities, the national roll-out of the Investment Based Planning Strategy occurred at this year's International Economic Development Council's National Conference in Philadelphia.  Here is the presentation.

Wed ladams upload to matt- ignite presentation from Donald Martin

TOD Investments Spur Economic Revitalization in Orlando Suburbs

SunRail is Central Florida's new commuter rail system scheduled to open in early 2014.  It is a 61- mile system connecting Orlando to its outlying suburbs north to south from Deland to Poinciana.  The first phase runs 32 miles and includes 12 stations, paralleling the congested I-4 corridor in Orange, Seminole and Volusia Counties. Total cost of the system is $1.1 billion, $615 million for construction and $491 million in right-of-way acquisition.  Funding is split with 50% coming from the Federal government, 25% from the State Government and 25% from local partners, including Volusia, Seminole, Orange and Osceola Counties and the City of Orlando.

With construction of the stations well underway, a major concern has been how to jump start private sector investment in and around the planned stops.  While much planning has gone into station area design, attracting investment partners has not always been easy or automatic.  Fortunately for the region, a local development services and architectural firm, Associated Consulting International, ACi, has stepped up and delivered for a number of the suburban communities along the line.   To date, two suburban communities have seen major private investment commitments as a result:

Longwood, Florida 

Weston Park GP, LLC will develop Weston Park, a $24 million, 201-unit apartment project as a first phase situated at the station platform.  Office and retail are being planned for phase 2.   The company also plans to build a 120-unit apartment complex for seniors two blocks north of the station. The $18 million project will be financed by the Florida Housing Finance Corp..

ACi was instrumental in securing the deal involving an intricate pre-development strategy including the City, the County and FDOT.  Larry Adams, president of ACi explains "These deals just don't happen,  Someone's got to work through the complexities of the deal and secure the commitments.  We make it easy for private partners to come to the table."   For more see the Longwood Station Plan.

Weston Park, Longwood, Florida

Lake Mary, Florida

In Lake Mary, Epoch Properties Inc. will build 200 units of luxury apartments and parking structure on 3.2 acres near the SunRail station.  The project named "Station House" will contain one, two and three bedroom units ranging in size between 665 sq. ft. up to 1,237 sq. ft.  In this case, ACi served as the City's development adviser.  Through its soft solicitation process, ACi was able to deliver to the City the highest quality developer willing to pay a premium to the City for the property.  Through a break-through data discovery, documenting the large workforce commuting into the City daily, the deal was sealed.

Beating the Trends

The fact that ACi was able to deliver new development at these locations even before actual start-up of the SunRail system is made even more remarkable given recent data published by Dena Belzer, President of Strategic Economics, in her presentation: TOD and the Relationship Between Transit and Economic Development.  This research found that suburban locations, depending on their type, garnered between 0% and 9% of all new TOD development between 2005 and 2009; while 68% of new TOD development went to the transit systems' urban cores.

When asked about this incredible track record, Adam explained that they have developed a unique process called an Investment-Based Planning Strategy involving both a high level assessment using big data trends as well as a sophisticated targeted-asset, Public-Private Partnership (P3) delivery method.  "Key to successful development commitment is our unique ability to involve financial underwriters in the review of the value proposition" said Adams. 

Stay tuned to this blog as we continue to explore this innovative model for delivering development to communities in need of expanding their tax base and reinvigorating their communities.

 

More Bad News for American Suburbs

A recent editorial by James Briggs, Associate Editor of the Baltimore Business Journal offers new evidence as to why our suburban communities are in trouble.  The reason, Millennials are not interested in purchasing the large homes which offer only the automobile as the sole mode of travel.  Their preference; to live in communities offering multiple housing types, close to mass transit, restaurants and retail.  Check it out at http://www.bizjournals.com/baltimore/blog/real-estate/2013/06/letter-from-a-millennial-were-not.html  

Food Trucks -- Spicing up the Suburbs

Food trucks at Fleet Peoples Park, Winter Park Florida

Food trucks provide a valuable service to many suburban communities,giving them the ability to fashion community-building events and create instant third spaces.  According to Daniel DJ Heffernan, food trucks fill a niche not being met by restaurants, adding choice and diversity to a city's food scene, which is so important for suburban locations where "place" identity is lacking.     

From the vendor perspective, food trucks offer many entrepreneurs a low-cost way to get into the restaurant business. Where the cost of start-up for a food truck ranges from $50,000 to $100,000, the costs for starting a brick-and-mortar restaurant can be upwards of $250,000.  Cathy Cheney has followed the food truck phenomenon in Portland, OR.  She has observed that food truck experience is like boot camp for restaurant entrepreneurs.  The would-be restaurant operators learn customer service and how to build a business under the trying experience of a confined kitchen with no storage space.  Most will never generate enough business to justify conversion to a permanent restaurant.   Those that do make the transition have exceptional food and a strong business plan. A sampling of these include: Beaver's Coffee & Donuts in Chicago, Calexico in NYC, District Taco in Washington DC, Taqueria Authentica in the Newark, NJ area, Pok Pok in Portland, and Clover Food Lab in Cambridge/Boston.

I recently interviewed Michael Bavaro, a local food truck vendor and owner of ubergoodfood.com in Orlando, FL.  He actually sold his restaurant at a suburban location to go into the food truck business.  For him, the change provided some cost savings-including elimination of the rent and the need to hire servers.  Rather than waiting for customers to find a fixed location, the food truck allows him to take food creations to his customers.   Bavaro's major concern was the number of new food trucks entering the market, a market where the number of events and locations are more or less fixed.  His strategy included co-marketing and event teaming with several other trucks, catering private events, and serving up high quality food creations.

Clearly, food trucks are providing suburban America with a way to begin the evolution of a community gathering place with the all-important food component.  In a future blog I will explore ideas of how suburban cities might proactively encourage the successful food truck vendors to establish fixed restaurants in their city.

Don Martin
dsmamerica.com   
 

10 Facts: Do you really know the Suburbs?

http://new.gbgm-umc.org/umw/response/articles/item/index.cfm?id=269

Edinborough Park -- Activated Indoor Open Space

Adventure Peak

Edinborough Park, Edina MN

Today in Minneapolis-St. Paul, the temperature was -1 Fahrenheit.  A perfect day to take the kids to the park if you live in the City of Edina, Minnesota!  Here you will find Edinborough Park, a one-acre park with children's three-story "Adventure Peak" play structure, multipurpose courts/great hall, amphitheater, community green, swimming pool, and track -- all totally enclosed in a climate-controlled atrium.

This atrium park sits between three high-rise towers providing plenty of structural enclosure and  activated third spaces.  My family, together with my sister-in-law's family, spent the weekend at the  Residence Inn which gives the visitor a lobby view of Adventure Peak.  My two nieces had a great time here!  Also supporting the park is Edina Park Plaza, an independent and assisted living facility.  They bill this as the only place in Minnesota where you can live in 70 degree weather year around.  Rounding out the park edge is the 3300 Corporate Center, a 100,000 s.f. building housing doctors, lawyers, dentists, as well as "Especially for Children" providing care and education for young children.

Edina Park Plaza

Edinborough Park is a perfect solution for a park that is stimulating year-around community as well as economic development in a cold climate.  Congratulations Edina!  For more information visit Edinborough Park.    

The Grand Hall