CityFixer

The Atlanta Transit Agency's Big Plan to Convert Parking Lots into Housing

MARTA sees real estate as a gateway to better train and bus service.

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Tim Adams/Flickr

MARTA, the transit authority for metro Atlanta, is quietly becoming a player in the real estate world, and it has its excess parking to thank. In the past few months, the agency has pushed forward with plans to develop under-used parking lots at three stations—King Memorial, Avondale, and Edgewood/Candler Park—into mixed-use commercial and residential buildings. And MARTA expects to secure at least two more such deals by early next year.

Talk about a shift from cars to transit.

The moves are part of a broader push by MARTA to capitalize on the transit-oriented development occurring in and around the city. Rather than sit on the sidelines during the resurgence, the agency decided to join the action. MARTA officials expect the new TOD program to pay off twice over: first, by pumping revenue from the projects back into the system's trains and buses, and second, by enticing residents who move into the buildings onto the trains.

"People have been looking at these parking lots for decades wondering why they were just sitting there," says Amanda Rhein, senior director of transit-oriented development at MARTA. "It's clear there's a significant amount of in-town resurgence, based on the development that's happening here, and the majority of it is within close proximity of our stations. So this is really just MARTA finally participating in that activity."

Like many U.S. transit agencies, MARTA has long struggled to secure reliable funding. The agency doesn't receive money from the state, instead relying on sales tax income from participating counties, making it vulnerable to big economic swings. After the Great Recession, MARTA reduced staff and service while increasing fares, and when an effort to expand the revenue base failed in a 2012 referendum, the agency found itself facing a $33 million deficit.

So MARTA got creative. Keith Parker, who took over the agency in late 2012, implemented a transformation initiative that involved, among other things, a new planning strategy emphasizing TOD. In spring of 2013, Parker announced that MARTA would have five station-area projects underway within two years; to date the agency has identified developers for three projects, targeted several stations for the final two projects, and expects groundbreaking on some of the buildings as early as next year.

Enabling the projects is MARTA's recognition that certain stations have devoted too much space to parking—an insight that several transit agencies around the world now share. At King Memorial Station, an urban station that Rhein says doesn't make sense to reach by car, the agency owned four acres of parking lots adjacent to the station that it didn't even use. Instead, the space had been subleased to a nearby hospital.

As part of its TOD push, MARTA wants to develop mixed-use properties atop its urban stations; above, North Avenue Station.  (Courtesy MARTA)

With the new projects, MARTA will lease the land—typically for 99 years—to developers planning mixed-use, transit-oriented buildings. (Walton Communities plans 13,000-square feet of retail and 386 residential units for the four acres at King Memorial.) Rhein says MARTA has chosen to lease rather than sell its land because agency rules stipulate the lease revenue can go toward transit operations, an area of urgent need for MARTA, while sales revenue must go toward capital projects. In the short term, the TOD influx will be reinvested into better service on trains and buses.

"That is the goal," she says. "To generate money for operations."

In the long term, MARTA expects such upgrades to result in more riders, which in turn will mean more fare revenue. The big picture outlook also includes nicer public spaces for the city; each project requires a park or a plaza, and 20 percent of all housing must be affordable, says Rhein. MARTA is also looking into air rights development at four downtown stations—Lenox, Arts Center, Midtown, North Avenue—and working with the Urban Land Institute to target TOD opportunities in weaker real estate markets along the system's south and west lines.

Plenty of challenges remain. The biggest may be a longstanding policy that MARTA must replace any lost parking spaces for transit patrons who drive to a station. While the rule makes sense, says Rhein, it poses problems in terms of financing the spots and incorporating them into the mixed-use project. ("It's just a little bit at odds with what we're trying to accomplish," she says.) Whatever the hurdles, Rhein believes the TOD program is a critical step toward shifting public perceptions of MARTA as wasteful and of Atlanta more broadly as car-reliant.

"I definitely think that will be a byproduct of this initiative," says Rhein. "We're going to make the stations themselves and the surrounding areas more pleasant and more easily accessible, and we'll be providing amenities to our riders and to the surrounding community. So I think people will realize that and give MARTA a chance."

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