Transbay Transit Center: Key Investment in San Francisco's Future

TRANSBAY TRANSIT CENTER:

Key Investment in San Francisco’s Future

as a World Class City

EXECUTIVE SUMMARY

Transbay Transit Center:

Key Investment in San Francisco’s Future as a World Class City

The Transbay Transit Center Project will transform downtown San Francisco by creating a landmark

multi-modal transportation station and new parks as part of a vibrant new neighborhood in the heart of the

ﬁnancial district. The approximately $4.5 billion, ﬁve-level Transit Center will bring together eleven local,

regional, and statewide transit systems, serving as the new northern terminus of Caltrain commuter rail and

future high speed rail. The Transit Center’s street- and upper-level retail and its 5.4-acre rooftop park will

anchor this new downtown neighborhood. The Transbay Project will be the catalyst for new development,

including redevelopment of land once occupied by abandoned freeway ramps and the former Transbay

Terminal, to create approximately 4,500 new homes, over 1,300 of which will be affordable to low- and

moderate-income households, and over 6 million square feet of commercial space.

The attached report,

Transbay Transit Center: Key Investment in San Francisco’s Future as a World Class

City

, applies numerous economic studies showing that buyers and renters will pay a premium for residential

and commercial properties located near public transit and for access to parks, open spaces, and other

amenities associated with high quality neighborhoods. The improved transit access, public spaces, and

neighborhood amenities provided by the Transbay Project are projected to enhance the value of private

properties located within ¾ miles of the Transit Center by an estimated $3.9 billion, or 5 percent on

average, adding $1.2 billion to the value of residential property and $2.7 billion to the value of commercial

property. Value enhancement for properties directly adjacent to the Transit Center is estimated at

11 percent. In addition, redeveloping the public property once occupied by the former Transbay Terminal

and abandoned freeway ramps is projected to stimulate over $4 billion in new development.

These value premiums reﬂect the convenience and improved quality of life that the Transbay Project will

provide to local residents, commuters, and employers. The underground Downtown Rail Extension

will bring more than 31,000 Caltrain passengers to the Transit Center each day, along with millions of

high speed rail passengers annually. Better transit connectivity will expand the regional labor market and

make it easier for workers to reach jobs. Moreover, the use of transit instead of cars will reduce air pollution

and greenhouse gas emissions by removing thousands of vehicles from California streets and highways,

increase physical activity and productivity, and foster better health.

The Transbay Project will also strengthen San Francisco’s position in the global economy. World class

cities such as New York, London, Paris, Tokyo, and Berlin are pursuing major multi-modal transit projects

to enhance economic competitiveness and simultaneously revitalize communities in the urban core.

For San Francisco, the Transbay Project’s investment in transit connectivity, public open space, and urban

design will create strong synergies with the city’s world-renowned technology and social media sectors,

which thrive in compact, transit-rich environments. The Transbay Project will help keep San Francisco at the

forefront of the ever-changing global economy.

We invite you to visit our project at www.transbaycenter.org.

Maria Ayerdi-Kaplan

Executive Director

TABLE OF CONTENTS

Executive Summary

1 Landmark Multi-modal Transportation Hub 1

in New Downtown Neighborhood

A. Transbay Transit Center 2

B. Transbay Neighborhood Transformation 4

C. Future Development in the Neighborhood 5

2 Economic Impact of the Transbay Project 9

A. Property Value Enhancement 10

B. Regional Economic Beneﬁts 17

3 Priority Investment for Bay Area’s

Economic Future 21

A. Stimulate San Francisco’s Economy 22

B. Enhance Regional Connectivity 23

and Competitiveness

C. Support San Francisco’s 24

Position as a World Class City

4 Conclusion 31

The Transbay Project will

generate a broad range of

economic and environmental

beneﬁts from higher property

values, expanded economic

output, new employment,

and better health outcomes.

It will reinforce San Francisco’s

position as world class city and

global center of technological

innovation.

LANDMARK MULTI-MODAL TRANSPORTATION HUB IN NEW DOWNTOWN NEIGHBORHOOD 1

LANDMARK MULTI-MODAL

TRANSPORTATION HUB IN NEW

DOWNTOWN NEIGHBORHOOD

The Transbay Transit Center Project is an inspiring and

forward-thinking transit oriented development that will

transform downtown San Francisco and the Bay Area’s

regional transportation system by creating a landmark

multi-modal transit hub in the heart of a vibrant new

downtown neighborhood. The Transbay Project consists

of three key elements:

• Newmulti-modalTransitCenter,whichwillbe

the“GrandCentralStationoftheWest.”

• Redevelopmentofvacantandunderutilized

State-ownedparcelsintoawalkable,mixed-use,

mixed-income,andtransitorientedcommunity.

• Creationofanewdowntownneighborhoodwithparks,

retailandurbanamenities,whichwillserveastheBay

Area’smostdenseemploymentandresidentialcenter.

The Transbay Transit

Center Project is an

inspiring and forward-

thinking transit oriented

development that will

transform downtown

San Francisco and the

Bay Area’s regional

transportation system.

2 TRANSBAY TRANSIT CENTER: KEY INVESTMENT IN SAN FRANCISCO’S FUTURE AS A WORLD CLASS CITY

A. Transbay Transit Center

The approximately $4.5 billion Transit Center will be the new “Grand Central Station of the West,”

a multi-modal transit hub that will centralize the region’s transportation network and streamline access

tostatewide,national,andinternationaltransportationnetworks.TherstphaseoftheTransbayprojectfeatures

aunique,curvilinearsteelstationdesignthatwillbethecenterpieceofSanFrancisco’snewestneighborhood.

Itwillfeature:

 thatwillconnecteleventransitsystemsunderoneroof—Muni,

ACTransit,GoldenGateTransit,SamTrans,WestCATLynx,Greyhound,Paratransit,BART,Caltrain,

Amtrak,andfuturehighspeedrail—enablingpassengerstotravelseamlesslythroughouttheregion

andCaliforniaonpublictransit,aswellasconnecttoglobaltravelnetworks.

 ,includinga“living”roof,

infusionofnaturaldaylightthroughadramaticlightcolumninthestation’sGrandHall,andgreen

buildingsystemsthatfeatureenergyefciency,passivecooling,andwaterreuse.

 a1,400-footlong,5.4-acrelinearparkontopoftheTransitCenterwithopenlawns,

gardens,performanceareas,walking/joggingpaths,aplayground,anduniquerestaurant/caféspace.

 integratedwithintheTransitCenterandliningthesurroundingstreets,

featuringamixofcafés,specialtyshops,andneighborhoodshops,includinganurbangrocer.

TheTransitCenterwillenhanceregionalandnationalconnectionstotransitforBayArearesidents,workers,and

visitors.WhileCaltrainconnectsSanFranciscotoSiliconValleybyrail,itsservicecurrentlyterminates1.3miles

fromdowntownSanFrancisco,greatlylimitingutilityforbothcommutersandridersoftheplannedstatewide

highspeedrailsystem.ThesecondphasewillextendCaltraindowntownintothenewTransitCenter,saving

commutersuptoanhoureachdayintraveltime.Morethan31,000Caltrainpassengersareprojectedtouse

theTransitCentereachweekday,

dramaticallyreducingsingleoccupantvehicleuseandrelatedcongestion

intheBayArea.

TheundergroundDowntownRailExtension(DTX)willrunbeneathSecondandTownsendStreetsandisbeing

designedtoaccommodatehighspeedrail,makingtheTransitCenterthefuturehub for an integrated rail

systeminNorthernCalifornia.Whencompleted,CaliforniaHighSpeedRailwillprovidean800-milesystem

thatspansthelengthofCalifornia,connectingSanFranciscotoSacramento,LosAngeles,andSanDiego,

withadditionalservicetotheCentralValley.



LANDMARK MULTI-MODAL TRANSPORTATION HUB IN NEW DOWNTOWN NEIGHBORHOOD 3

CALIFORNIA HIGH SPEED RAIL

California High Speed Rail (CHSR) will allow trains to travel at speeds up to 220 miles per hour,

similar to high speed trains in Europe and Asia, reducing travel time between San Francisco and

Los Angeles to under 3 hours while transporting, system-wide, about 26 million intercity passengers

annually. It will connect with existing rail, air, and highway systems, allowing intercity commuters and

long distance travelers easier access to metropolitan regions and other transit options and improving

trafﬁc conditions and air quality by reducing automobile trafﬁc. This will help address trafﬁc congestion

in California cities, which is projected to continue to be among the nation’s worst in 2029 when CHSR

is planned to become operational. California’s $2.7 billion investment in the ﬁrst phase of high speed

rail is projected to return over three times this amount in statewide GDP (up to $8.8 billion), generating

new construction jobs and stimulating local economies.

4 TRANSBAY TRANSIT CENTER: KEY INVESTMENT IN SAN FRANCISCO’S FUTURE AS A WORLD CLASS CITY

B. Transbay Neighborhood Transformation

DowntownSanFranciscoisatthecenteroftheworld’sinnovationengineandservesastheregion’spremier

commercialdistrict, accommodating aboutthree-quartersof thecity’s ofcejobs.

 The newTransit Center

willfurtherreinforcethecity’sstatusasthemostdesirableplacetoconcentratenewgrowthintheBayArea.

TheTransitCenter will also anchorthenewTransbayneighborhood that isconnectingdowntownwiththe

emergingRinconHillresidentialneighborhoodtothesouth.

The Transbay Redevelopment Plan (adopted 2005) and the Transit Center District Plan (adopted 2012) work

inconcerttocreateahigh-density,mixed-use,transitorientedneighborhood.TheTransitCenterDistrictPlan

is a catalyst for new development by creating special zoning that permits a limited number of tall buildings

aroundtheTransitCenter.TheTransbayRedevelopmentPlanfacilitatesneighborhoodtransformationthrough

the redevelopment of vacant and underutilized State-owned properties that originally served the former

TransbayTerminalorwerepartofanowdemolished,elevatedfreewaysystem.Redevelopmentofthesepublic

propertieswillgenerateabout3,000housingunits,ofwhich35percent,orabout1,000units,willbeaffordable

to low- and moderate-income households, as required in the Transbay Redevelopment Plan and State law.

Together,thesetwoplanswillresultinover4,500newhomesandover6millionsquarefeetofcommercialspace.

Proceedsfromthelandsalesofthisredevelopedpublicproperty(valuedatabout$600million)andtaxincrement

generated fromthe growthin assessed value fromtheir development (valued at about $4 billion) will generate

revenuestohelpfundtheTransitCenter.

DevelopmentontheseState-ownedpropertiesisalreadytransformingthe

Transbayneighborhoodbycreatingnewjobsandadiversesetofhousingopportunitiesindirectproximitytotransit:

• ThelandmarkTransbayTransitTower,anelegant,

1,070-foot ofce tower designed by celebrity

architect César Pelli, will directly connect to the

Transit Center and its rooftop City Park. Now

underconstruction,the60-storyTransbayTransit

TowerwillbethetallestbuildinginSanFrancisco

and will incorporate state-of-the- art workplace,

safetyandsustainabilityfeatures.



• More than 1,200 new housing units are in the

process  of  being  developed  along  Folsom

Street, including two large scale mixed-income

developments (Blocks 6/7 and 9) and the Rene

CazenaveApartments(Block11).Currentlyunder

construction,theReneCazenaveApartmentswill

provide120unitsofsupportivehousingwithno

onsiteparkingdue to its closetransitproximity.

Ground oor retail is being developed along

FolsomStreettocreateanew“MainStreet”for

theneighborhood.

LANDMARK MULTI-MODAL TRANSPORTATION HUB IN NEW DOWNTOWN NEIGHBORHOOD 5

NEW TRANSBAY TRANSIT CENTER DISTRICT

NEIGHBORHOOD ELEMENTS

• About 6 million square feet of new downtown ofﬁce space in a high density commercial core

surrounding the new Transit Center, providing space for more than 24,000 new employees.

• About 4,500 new homes including about 1,300 affordable units, housing more than 7,000

new residents.

• Approximately 100,000 square feet of new retail in the Transit Center.

• Approximately 150,000 square feet of new retail in the Transbay neighborhood surrounding

the Transit Center.

• A dramatic new skyline punctuated by a limited number of tall buildings, including the tallest

high-rise in San Francisco and new hotels.

• New public parks, including a 5.4-acre rooftop park on the Transit Center and more than 5 acres

of new parks in the Transbay neighborhood.

• Wide sidewalks with landscaping, lighting, seating, and pedestrian amenities.

• Mid-block crossings keyed to alleyway systems and other pedestrian safety improvements.

• Safe and convenient bicycle lanes.



C. Future Development in the Neighborhood

Signicantnewcommercialandresidentialdevelopmentsareproposedforareasincloseproximity

tothenewTransitCenter.ThegrowthofSanFrancisco’srealestatemarketisdrivenbystrongemploymentgains

acrosstheBayArea,thecity’semergenceasamajorhubforrapidlyexpandingtechnologycompanies,andthe

increaseddesireforurbanlivingfromanexpanding,afuentGenYpopulation.(Asanexample,thenumber

ofplannedandproposedhousingunitshasgrownbymorethan25percentinSanFranciscooverthepast

twoyears.)

Future development in the new Transbay neighborhood (facilitated by the Transbay Redevelopment Plan

andTransitCenterDistrictPlan)willfeatureabout4,500newhomes,includingnearly1,300affordableunits,

approximately6millionsquarefeetofnewofcespace,aretail“boulevard”onFolsomStreet,andabout

11acresofneighborhoodparks.

(ThisincludesredevelopmentoftheState-ownedpropertiesdescribedabove.)

ThenewTransitCenter,alongwiththeseneighborhoodamenities,willcreateapremierurbanenvironment

wherepeoplefromallwalksoflifecanwork,live,andplay.

Developersandinvestorshavebeenattractedtothisnewneighborhoodgivenitstransitproximity,convenience

to employment, currentandplanned open space, and expandingneighborhood amenities.Overall, about

7millionsquarefeetofcommercialdevelopmentandabout6,400residentialunitsareplannedorcurrently

inSanFrancisco’sdevelopmentpipelinewithin¾ofamilewalkingdistanceoftheTransitCenter(inaddition

towhatwillbedevelopedontheState-ownedparcels).

FERRY

BUILDING

RINCON

PARK

SAN FRANCISCO BAY

BAY BRIDGE

THE EMBARCADERO

STEUART ST

SHAW ALY

HAWTHORNE ST

3RD ST

1ST ST

ESSEX ST

FREMONT ST

BEALE ST

MAIN ST

SPEAR ST

HOWARD ST

CLEMENTINA ST

MINNA ST

NATOMA ST

TEHAMA ST

FOLSOM ST

HARRISON ST

JESSIE ST

STEVENSON ST

ANTHONY ST

MISSION ST

MARKET ST

MALDEN ALY

OSCAR ALY

BRYANT ST

BRANNAN ST

NEW MONTGOMERY ST

TRANSIT CENTER

DISTRICT

TRANSBAY

REDEVELOPMENT

PROJECT AREA

Above: Development Vision for Transbay

Neighborhood

Right: Transbay Redevelopment Project

Area and Transit Center District Plan

Area Boundary, Zones, and Development

Blocks

LAND USE ZONES

ZONE 1:

Transbay Downtown Residential

ZONE 2:

Transbay C-3

Project Area Boundary

500

100



Parcel T

Transbay Transit Tower Ofﬁce Building

HinesandBostonProperties

1.4Millionsquarefeetofofficeandretail

Block 9

Mixed-Income Housing

Avant/EssexandBRIDGEHousing

456marketrateand114affordableunits

Block 11

Rene Cazenave Affordable Housing

CommunityHousingPartnershipandBRIDGEHousing

120supportivehousingunits

Block 6/7

Mixed-Income Housing

GolubCorporationandMercyHousingCalifornia

409marketrateand147affordableunits

Development on State-owned Properties Transforms Transbay Neighborhood

People are willing to pay more for property in well-planned, transit oriented

neighborhoodsthatofferurbanamenities,suchasparksandopenspacealongwith

amixofcommercial,housing,andentertainmentuses.Theyarealsomoreinclinedto

ridetransittoandfromdestinationsthatprovideanattractivewalkableenvironment.

ECONOMIC IMPACT OF THE TRANSBAY PROJECT 9

ECONOMIC IMPACT OF

THE TRANSBAY PROJECT

The conveniences and amenities provided by the Transbay

neighborhood will translate into concrete economic gains

for residents and employers throughout the Bay Area:

• Downtown properties surrounding the Transit Center will

increase in value from improved access to high quality public

transit, new open space, and the creation of a well-planned,

walkable mixed-use neighborhood with urban amenities.

• San Francisco and the entire Bay Area region will benet

from reduced travel times, better environmental and human

health, an expanded labor market, new jobs, and increased

economic output.

Station proximity has

a signiﬁcantly stronger

impact when coupled

with a pedestrian-

oriented environment…

TOD has a synergistic

value greater than the

sum of its parts.

—Michael Duncan

University of North Carolina

Charlotte

10 TRANSBAY TRANSIT CENTER: KEY INVESTMENT IN SAN FRANCISCO’S FUTURE AS A WORLD CLASS CITY

A. Property Value Enhancement

Property values surrounding the Transit Center will

be enhanced from improved access to transit, new open

space, and the creation of a new vibrant, mixed-use

neighborhood. Extensive economic literature documents

the premium that buyers and renters of both commercial

and residential property pay for locations within ¾ of a mile

of high quality public transit. These new transit connections

will enhance the value of nearby properties, as will the new

5.4-acre City Park, public plazas, art installations, retail,

and other neighborhood amenities that include tree-lined

streets, bike lanes, and widened sidewalks that promote

walkability. Figure 2 shows key characteristics that affect

the level of value premiums found near transit stations,

open space, and other neighborhood amenities.

1. Transit Premiums

Transit systems create value when they save riders time

and money by providing efﬁcient access to jobs, housing,

and other destinations such as retail, recreational, and

cultural facilities. Convenient connection to a regional job

center or central business district is especially important.

The extension of Caltrain into the Transit Center will reduce

commute times into downtown San Francisco by up to

30 minutes

and avoid the current need to transfer from

Caltrain to a bus or light rail to reach downtown. Additionally,

connecting 11 transit systems in a single, attractive facility

improves the existing transportation network.

Numerous studies examine the extent to which transit

increases the value of properties surrounding stations, with

nearly all ﬁnding a measurable positive beneﬁt for dense,

mixed-use areas like Transbay. The Concord Group and

Seifel Consulting reviewed more than 50 studies by national

and international scholars and research organizations, and

found that these studies typically calculated transit beneﬁts

at several key radii – adjacent, ¼ mile from station, ½ mile

from station, and ¾ mile from station. The studies emphasize

that “rail systems be planned to reach regional accessibility

centers quickly.”

The Transbay location is ideal to capture

this value, with nearly 180,000 jobs within a ½ mile walking

radius,

making the Transbay neighborhood the currently-

densest cluster of employment in the Bay Area.

FIGURE 2: PROPERTY VALUE PREMIUM COMPONENTS

TRANSIT

Transit saves time/cost

versus driving:

•Reducedtrafccongestion

•Reducedparking/toll/commuter

expense

Transit system that provides

extensive and interconnected

network

•Linksregionaljobcentersand

central business districts

•Improvesintermodalconnections

(commuter rail, subway, light rail,

local bus, and intercity rail/bus)

OPEN SPACE

Proximity or direct access

to parks or open space

NEIGHBORHOOD

Walkable

(small blocks, pedestrian paths)

Urban amenities

(retail, parks, and active streets)

Mix of land uses

(jobs, housing, and entertainment)

Supportive policy framework

(neighborhood plans, compact development)

The beneﬁts of having good

connectivity to the rest of

the region…get capitalized

into the market value of

land.…Where market

conditions are conducive

and pro-development

policies are in place…

land-value impacts can be

substantial.

—Robert Cervero,

University of California Berkeley

ECONOMIC IMPACT OF THE TRANSBAY PROJECT 11

0 1,000 2,000 3,000 4,000 5,000 6,000

Distance From Station in Feet

Measured Premiums

10%

12%

14%

16%

18%

20%

Adjacent

1/4 Mile

1/2 Mile

Polynomial Trend Line

Linear Trend Line

3/4 Mile

1/2 Mile

1/4 Mile

Adjacent

FIGURE 4: APPLICABLE TRANSIT LITERATURE VALUE PREMIUM RESULTS

FIGURE 3: TRANSBAY PROJECT VALUE PREMIUM AREAS

3/4 Mile

1/2 Mile

1/4 Mile

Adjacent

Overall beneﬁts vary, inﬂuenced by features such as the quality of station, ridership levels, frequency of

transit availability, and distance to employment cores. The ﬁgures below present conclusions regarding premiums

at various radii. On the whole, stations that are connected to mature, multimodal transit systems and located

in walkable neighborhoods like Transbay tend to generate the greatest increase in nearby property values.

Figure 3 shows the boundaries of the value premium areas by distance associated with the Transbay Project.

Figure 4 shows the research results from the most applicable transit literature.

12 TRANSBAY TRANSIT CENTER: KEY INVESTMENT IN SAN FRANCISCO’S FUTURE AS A WORLD CLASS CITY

The majority of academic research focuses on areas that previously did not provide transit or had limited

transitservice. Recognizingthat San Franciscois a cityalreadyrich with transitthat serves downtown,the

analysis adjusted the research ﬁndings to take this into account based on consultation with transit researchers:

research ﬁndings with a premium greater than 15 percent are excluded, and the resulting premiums are further

discounted by 50 percent. Table 1 presents the adjusted transit premiums for each radius, which range from

5 percent for properties adjacent to the transit station to 1.7 percent for properties within ¾ miles.

2. Open Space and Neighborhood Premiums

Research demonstrates that properties located near parks or open space also derive a value premium.

People are willing to pay more for a home located near a nice park, and public space provides workers a needed

respite and gathering place near their jobs. Development of the 5.4-acre rooftop park on the Transit Center

as well as other new neighborhood parks and public plazas will provide valuable amenities to residents,

workers and visitors alike.

Another key factor inﬂuencing the value premium accruing to property owners and tenants is the quality of

neighborhood amenities and conveniences. Both residents and businesses are willing to pay more for property in

walkable neighborhoods that offer urban amenities such as a mix of retail and land uses including employment,

housing, and entertainment. People are also more inclined to take transit to and from destinations that provide

an attractive pedestrian environment, including dense street networks, pedestrian paths, and ample retail

offerings.

The consultant team reviewed literature describing open

space and/or neighborhood amenity premiums. Using more

than 20 research studies (one of which compiled results from

30 studies), open space and neighborhood amenity value

premiums ranged from 3 percent to 15 percent. The well-

designed City Park, neighborhood parks and public plazas

throughout Transbay are conservatively projected to add

3 percent to the value of property adjacent to and within ¼ mile

of the Transit Center. No premium associated with proximity

to open space was assumed beyond ¼ mile.

Additionally, the development of the Transit Center will bring

activity, energy, vibrancy, and improved walkability to downtown

San Francisco, qualities that will drive value premiums associated

with the creation of the most dense residential neighborhood

and employment center in the Bay Area. The neighborhood

premium or “cool factor” is attributable to the diverse urban amenities, vibrant mix of commercial and

residential development activity, landmark architecture (including the state-of-the-art Transit Center), tree-lined

streets, and improved walkability in a neighborhood with limited current prestige. This new neighborhood will

draw high-end businesses and residents in search of a well-designed urban environment with diverse retail

options and street-level activity. Although premiums on values could become much higher upon build-out of

the Transbay neighborhood, the neighborhood premium is calculated as an additional 3 percent to the value of

property adjacent to and within ¼ mile of the Transit Center, while no premium was assumed beyond ¼ mile.

Table 2 summarizes the transit, open space and neighborhood value premiums.

More than 30 studies have

shown that parks have a

positive impact on nearby

residential property values.

Other things being equal,

most people are willing to

pay more for a home close to

a nice park. Economists call

this phenomenon

“hedonic value.”

The Trust for Public Land

ECONOMIC IMPACT OF THE TRANSBAY PROJECT 13

Approximate

Radius

Adjusted Transit

Premium

Open Space

Premium

Neighborhood

Premium

Total Premium

Adjacent 5.0% 3.0% 3.0% 11.0%

1/4 Mile 3.9% 3.0% 3.0% 9.9%

1/2 Mile 2.8% 0.0% 0.0% 2.8%

3/4 Mile 1.7% 0.0% 0.0% 1.7%

TABLE 2: TRANSIT, OPEN SPACE AND NEIGHBORHOOD VALUE PREMIUMS wITHIN TRANSBAY AREA

Approximate Radius Applicable Transit

Research Results

Constrained Transit

Research Results

Adjusted Transit

Premium

Adjacent 11.1% 10.0% 5.0%

1/4 Mile 8.6% 7.8% 3.9%

1/2 Mile 6.0% 5.6% 2.8%

3/4 Mile 3.5% 3.4% 1.7%

TABLE 1: SUMMARY OF TRANSIT PREMIUM RESULTS AND ADJUSTMENTS FOR TRANSBAY

3/4 Mile

1/2 Mile

1/4 Mile

Adjacent

10%

12%

14%

16%

18%

20%

0 1,000 2,000 3,000 4,000 5,000 6,000

Measured Premiums

Distance From Station in Feet

Polynomial Trend Line

Linear Trend Line

FIGURE 5: SAN FRANCISCO CONSTRAINED TRANSIT VALUE PREMIUM RESULTS

14 TRANSBAY TRANSIT CENTER: KEY INVESTMENT IN SAN FRANCISCO’S FUTURE AS A WORLD CLASS CITY

3. Value Premium on Surrounding Private Properties

The consultant team applied the transit, open space and neighborhood premiums to the value of existing

and new commercial and residential property within each of the identiﬁed radii.

Using data from the

San Francisco County Assessor and other real estate research sources, the consultant team estimated

the square footage and value of existing commercial and residential development within ¾ miles of the Transit

Center to be approximately $69 billion, consisting of about 104 million square feet of commercial development

andabout 44,000 housingunits. In additiontothe $4 billionin new developmentfromredevelopmentof

public properties, about 7 million square feet of new commercial development and about 6,400 residential

units are currently underway or planned on private properties within ¾ miles of the Transit Center, representing

a future development value of $9 billion (before consideration of the value premiums). Table 3 summarizes the

amount of existing and new development in the Transbay area on private properties. (Value enhancement from

redevelopment of public properties is discussed in the next section.)

APPROXIMATE

RADIUS

EXISTING DEVELOPMENT NEW DEVELOPMENT

Commercial

Square Feet

Residential

Units

Commercial

Square Feet

Residential

Units

Adjacent 6.9M SF 775 2.9M SF 900

1/4 Mile 33.2M SF 8,225 2.3M SF 2,960

1/2 Mile 42.6M SF 13,612 522K SF 883

3/4 Mile 21.7M SF 21,487 1.3M SF 1,652

Total 104.4M SF 44,099 7.0M SF 6,395

*Representsexistingandnewdevelopmentonprivateproperties,notlocatedonpublic(State-owned)properties.Newdevelopmentis

based on private development currently underway and within the Planning Department pipeline. Actual new development in the Transit

Center District Plan Area and downtown is anticipated to be greater.

TABLE 3: ExISTING AND NEw DEVELOPMENT ON PRIVATE PROPERTIES*

FIGURE 6: PRIVATE PROPERTY VALUE wITHOUT PREMIUMS (IN $MILLIONS)

$5,779M

$26,557M

$23,074M

$5,000

$10,000

$15,000

$20,000

$25,000

$30,000

$35,000

$5,779M

$22,193M

$26,557M

$23,074M

11.0%, $636

9.9%, $2,197

1.7%, $392

$5,000

$10,000

$15,000

$20,000

$25,000

$30,000

$35,000

Total Premium Value

Total Value

11.0%

9.9%

2.8%

1.7%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

Overall Average

Premium = 5%

Premium by Zone

Average Premium

$3.9B

TOTAL PREMIUM VALUE

2.8%, $744

Zone 4–3/4 MileZone 3–1/2 MileZone 2–1/4 MileZone 1–Adjacent

Zone 4–3/4 MileZone 3– 1/2 MileZone 2–1/4 MileZone 1–Adjacent

Existing Commercial Development

Future Commercial Development

Existing Residential Development

Future Residential Development

$22,193M

As illustrated in Figures 6–8 and summarized in Table 4, the consultant team applied the combined value premiums

applicable to each radii (ranging from 11 percent for adjacent properties to 1.7 percent for properties within

¾ mile) to both existing and new development. On average, private properties within the surrounding area

are anticipated to increase in value by about 5 percent or $3.9 billion.

As the intensity of commercial

development is higher

than residential development

in the surrounding area, almost

three quarters of the projected

property value premium—

$2.7 billion—will accrue

to commercial properties while

$1.2 billion will ﬂow

to residential properties.

ECONOMIC IMPACT OF THE TRANSBAY PROJECT 15

APPROXIMATE

RADIUS

EXISTING DEVELOPMENT NEW DEVELOPMENT TOTAL

PREMIUMS

Commercial Residential Commercial Residential

Adjacent $325 $47 $190 $74 $636

1/4 Mile $1,395 $448 $134 $220 $2,197

1/2 Mile $507 $210 $9 $19 $744

3/4 Mile $157 $201 $13 $21 $392

Total $2,383 $905 $346 $334 $3,969

TABLE 4: PROJECTED PRIVATE PROPERTY VALUE PREMIUM ACCRUING TO ExISTING AND NEw DEVELOPMENT (IN $MILLIONS)

$5,779M

$26,557M

$23,074M

$5,000

$10,000

$15,000

$20,000

$25,000

$30,000

$35,000

$5,779M

$22,193M

$26,557M

$23,074M

11.0%, $636

9.9%, $2,197

1.7%, $392

$5,000

$10,000

$15,000

$20,000

$25,000

$30,000

$35,000

Total Premium Value

Total Value

11.0%

9.9%

2.8%

1.7%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

Overall Average

Premium = 5%

Premium by Zone

Average Premium

$3.9B

TOTAL PREMIUM VALUE

2.8%, $744

Zone 4–3/4 MileZone 3–1/2 MileZone 2–1/4 MileZone 1–Adjacent

Zone 4–3/4 MileZone 3– 1/2 MileZone 2–1/4 MileZone 1–Adjacent

Existing Commercial Development

Future Commercial Development

Existing Residential Development

Future Residential Development

$22,193M

FIGURE 7: TRANSBAY BENEFIT PREMIUMS BY zONE

$5,779M

$26,557M

$23,074M

$5,000

$10,000

$15,000

$20,000

$25,000

$30,000

$35,000

$5,779M

$22,193M

$26,557M

$23,074M

11.0%, $636

9.9%, $2,197

1.7%, $392

$5,000

$10,000

$15,000

$20,000

$25,000

$30,000

$35,000

Total Premium Value

Total Value

11.0%

9.9%

2.8%

1.7%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

Overall Average

Premium = 5%

Premium by Zone

Average Premium

$3.9B

TOTAL PREMIUM VALUE

2.8%, $744

Zone 4–3/4 MileZone 3–1/2 MileZone 2–1/4 MileZone 1–Adjacent

Zone 4–3/4 MileZone 3– 1/2 MileZone 2–1/4 MileZone 1–Adjacent

Existing Commercial Development

Future Commercial Development

Existing Residential Development

Future Residential Development

$22,193M

FIGURE 8: TRANSBAY AREA PRIVATE PROPERTY VALUE (IN $MILLIONS)

16 TRANSBAY TRANSIT CENTER: KEY INVESTMENT IN SAN FRANCISCO’S FUTURE AS A WORLD CLASS CITY

4. Value Enhancement from Redevelopment of Public Properties

As described earlier, redevelopment of public properties once occupied by the former Transbay Terminal

and abandoned freeway is stimulating new development of residential, retail, and ofﬁce space adjacent

to the Transit Center. A substantial portion of this development is already in progress, including the 1.3 million

square foot Transbay Transit Tower and more than 1,200 residential units on Blocks 6, 7, 9, and 11. Once fully

redeveloped, more than $4 billion in new development is projected to be built on these properties, including

about 2.7 million square feet of commercial development and about 3,000 units of housing of which 35 percent

will be affordable to low- and moderate-income households. Redevelopment of these public properties

is signiﬁcantly contributing to the creation of this new compact, desirable, mixed-use and mixed-income

downtown neighborhood.

5. Overall Property Value Enhancement

Currently, more than 7 million square feet of new commercial development and about 6,400 residential units

are underway or planned on private properties within ¾ miles of the Transit Center, representing $9 billion in

newdevelopmentvaluebeforeconsiderationofanyvaluepremiums.Reectingtheconvenienceandimproved

quality of life that the Transbay Project will provide to local residents, commuters, and employers, the value

of existing and new development of private properties within ¾ miles of the Transit Center is anticipated to

increasebyanestimated$3.9billion.Inaddition, theredevelopmentofpublic (State-owned)propertiesis

projected to catalyze $4 billion in new development, with signiﬁcant residential and commercial development

alreadyunderway.Improvedaccess to transit,new open space,and thecreationofa newvibrant,mixed-

use neighborhood will enhance the long-term success and ﬁnancial sustainability of properties throughout

downtown San Francisco.

$9B

in new development currently

underway or planned on

private properties

$3.9B

in value premiums

on existing and new

development of

private properties

$4B

in new development from

redevelopment of public

(State-owned) properties

ECONOMIC IMPACT OF THE TRANSBAY PROJECT 17

B. Regional Economic Beneﬁts

From a regional and statewide perspective, the Transit Center will bring a multitude of beneﬁts ranging from

improved travel efﬁciency and decreased travel congestion, access to jobs, environmental and health beneﬁts,

access to arts and other cultural amenities, reduced costs for housing and transportation, both construction

andpermanentjobcreation,andoverallincreasestotheGrossRegionalProduct.

1. Improved Travel Efﬁciency and Decreased Trafﬁc Congestion

The new Transit Center will extend Caltrain into the downtown transit hub and improve connectivity between

transit systems. Tens of thousands of passengers will pass through the Transit Center each day. Additionally,

the extension of Caltrain to downtown San Francisco is estimated to attract approximately 13,000 new riders

and take thousands of vehicles off of Highways 101 and 280.

These travel efﬁciencies translate into travel time savings (the value of

alternative activities that a traveler could conduct instead of spending

time in transit) upwards of $380 million,

more than $120 million

in avoided vehicle operation and maintenance costs, and more than

$20 million in beneﬁts from improved safety.

Additional transportation

beneﬁts will be generated by future direct access from downtown

SanFranciscotodowntownLosAngelesviahighspeedrail.

2. Access to Jobs

As Bay Area residents enjoy better access to jobs, Bay Area employers

will likewise have better access to a larger labor pool of workers,

expanding the labor market regionally. For Bay Area companies,

this means greater access to top talent that will continue to drive

innovation. The expansion of the labor market is projected to increase

GrossRegionalProductbyalmost$250millionandpersonalincome

by more than $120 million.

Lackofaffordabletransportationaccesstojobsisasignicantbarriertoemploymentandeconomicdevelopment,

particularly for low-income households. In the Bay Area, workers from low-income households rely more

heavily on public transportation to commute, but often have poor access to transit from home, work, or both.

Consequently, workers from low-income households spend a disproportionate amount of time commuting.

The Transit Center, and in particular the DTX, will expand access to affordable transit opportunities to

Bay Area residents, and particularly to those who live in the southern neighborhoods of San Francisco and

along the Peninsula corridor.

3. Environmental and Human Health

The choice to use transit instead of cars has the additional beneﬁt of reducing emissions of air pollutants,

including greenhouse gasses. Local residents will experience health benets from improved air quality,

worth $8 million in cost savings from reduced emissions.

The DTX will reduce carbon dioxide emissions by

tens of thousands of tons each year,

while completion of the full high speed rail system is projected to reduce

these emissions by more than 3 million tons each year system-wide by 2030.

Too many cars and

trucks on highways that

are unable to handle

ever-increasing volumes

inﬂict time-wasting

costs and productivity

declines.

—What’s Next? Real Estate

in the New Economy,

Urban Land Institute

18 TRANSBAY TRANSIT CENTER: KEY INVESTMENT IN SAN FRANCISCO’S FUTURE AS A WORLD CLASS CITY

Development of the new Transit Center will yield

additional health benets for area residents. Recent

studies demonstrate that people who live and work

in communities with high quality transit beneﬁt from

increased physical activity, improved mental health, and

better access to healthy foods and medical care. They

tend to drive less and rely more on alternative modes

of travel, such as walking and cycling, which not only

increases cardiovascular activity and can lead to reduced

instances of diabetes but also result in less automobile

accidents and related fatalities.

4. Arts and Cultural Amenities

The Transbay Joint Powers Authority has commissioned

ﬁve major artworks that will be integrated with the Transit

Center’s design. Currently under development, each

piece will emerge from a close collaboration between the

artists and the Transit Center’s architect (Pelli Clarke Pelli

Architects), blurring the line between art and architecture

and making both more accessible to the general public.

At the Transit Center, art will not only serve to inspire, it will help to organize the Grand Hall. For example,

the star and cross motifs in artist Julie Chang’s ﬂoor design will point to entrances, escalators, and staircases.

Inaddition,therooftoppark,amphitheater,publicplazas,andretailspaceswillcreateuniqueamenitiesthat

will transcend the Transit Center’s basic purpose as a transportation hub, contributing to the social and cultural

life of the City, and inspiring the tens of thousands of people who will be exposed to beautiful art, green

spaces, and dynamic cultural events.

CREATE a new standard for transit stations

that transcends the basic purpose of

transporting people and enhances

the city’s cultural and social fabric.

INTEGRATE ﬁve major commissioned

artworks within the Transit Center’s design.

SHAPE the character of the new mixed-use

neighborhood using building design and

large-scale artworks that reference

San Francisco’s history, culture, heritage,

and environment.

Transit Center Architecture and Artwork Principles

Improving public transit can be

one of the most cost effective

ways to achieve public health

objectives, and public health

improvements are among the

largest beneﬁts provided by high

quality public transit and transit

oriented development.

Todd Litman,

Victoria Transport Policy Institute

GrandHallArtInstallation

ECONOMIC IMPACT OF THE TRANSBAY PROJECT 19

5. Reduced Housing and Transportation Cost

Housing and transportation costs tend to be the largest expenditures for households. When considering the

combined cost of housing and transportation, a recent study prepared by Chicago’s Center for Neighborhood

Technology found that residents of walkable areas that are well-served by transit pay less in combined housing

and transportation costs than those who live in auto-centric suburbs and other areas traditionally thought

to have a lower combined housing and transportation cost but that lack mass transit.

 In San Francisco,

the average household spends 39.5 percent of the average regional income on housing and transportation

as compared to between 50 and 60 percent for suburban East Bay and North Bay households that are not as

well-served by transit.

6. Construction and Permanent Job Creation

The construction of the Transit Center, including the DTX, is estimated to generate over 8,300 construction

job-years.

Another 27,000 permanent jobs are anticipated from the annual operation and maintenance of

the Transit Center, the DTX, and private development in the Transbay neighborhood.

Overall, construction

of the Transit Center will stimulate the economy by creating more than 125,000 jobs, directly and indirectly.

7. Increased Gross Regional Product

Regionally,theconstructionoftheTransitCenterandthebuildout

of the surrounding neighborhood are projected to generate up to

$87billioninGrossRegionalProductand$52billioninpersonal

income through 2030.

Collectively, the Transit Center and the surrounding public/

private development will provide a signiﬁcant boost to the overall

regional economy.

Most places are unaffordable

when it comes to combined

housing and transportation costs.

Seventy-two percent of American

communities are unaffordable

for typical regional households

when transportation costs—

the second largest expense in a

family budget—are considered

along with housing costs.

Center for Neighborhood Technology,

Updated and Expanded Housing and

Transportation Affordability Index

8,300

construction

job-years

27,000

permanent

jobs

$87B

inGrossRegional

Product through 2030

To remain globally competitive, the world’s top-ranked cities are making major

investments in infrastructure, particularly in high speed rail, that connect these cities to

the larger region and enhance mobility, stimulate economic development, and protect

the environment.

PRIORITY INVESTMENT FOR BAY AREA’S ECONOMIC FUTURE 21

PRIORITY INVESTMENT FOR

BAY AREA’S ECONOMIC FUTURE

The Bay Area is one of the most diverse and robust business

centers in the world and home to the nation’s most competitive

knowledge service sector. Led by companies such as Google,

Facebook, Salesforce, and Twitter, this sector has grown

despite the recent economic downturn. Research has shown

that businesses in the knowledge service sector thrive best in

a compact, transit-rich environment.

Investments in public

transportation and policies that encourage denser living and

work environments both facilitate local connectivity and increase

regional, state, national, and international competitiveness.

The Transbay Transit Center will position San Francisco

to achieve its economic growth strategy, capitalize on its

increasing transit ridership and improved regional access,

and support San Francisco’s position as a world class city.

The Transbay Transit

Center will position

San Francisco to

achieve its economic

growth strategy,

capitalize on its

increasing transit

ridership and improved

regional access, and

support San Francisco’s

position as a world

class city.

22 TRANSBAY TRANSIT CENTER: KEY INVESTMENT IN SAN FRANCISCO’S FUTURE AS A WORLD CLASS CITY

A. Stimulate San Francisco’s Economy

The Transit Center is critical to achieving key policy goals of San Francisco’s Economic Strategy to stimulate

the city’s economy, as summarized in the sidebar below.

It is already creating new jobs and providing youth

internship opportunities as part of ongoing collaboration with the San Francisco Uniﬁed School District. And in

particular, the Transit Center is part of the Transbay Redevelopment Plan and the Transit Center District Plan,

which set the stage for an entire new downtown neighborhood around the Transit Center.

Building on the City’s 1985 Downtown Plan, the Transbay Redevelopment Plan and the Transit Center District

Plan provide a framework for the development of ofﬁces, retail, hotel, and residential property, as well as

parks and pedestrian-friendly streets. They will catalyze the revitalization of spaces, including remnant freeway

parcels that have stood vacant since the Loma Prieta earthquake in 1989, and make way for the densest urban

neighborhood in the Bay Area. These plans will allow the City to streamline and coordinate its regulatory

processes. They also present opportunities for public-private partnerships, which translate into positive gains

for the City’s economic development. Major commercial and residential projects are already in the development

pipeline, ready to take advantage of these opportunities. These projects promise to recast the San Francisco

skyline and create a vibrant new downtown neighborhood centered around the Transit Center.

The Transbay Project will further many goals in San Francisco’s

Economic Strategy:

•MaximizeSanFrancisco’saccessibilitytoalocalandregionalworkforce

•Upgradeneighborhoodcommercialareas

•Providesufcientrealestateforstrategicpriorities

•Recognizeandenhancethevalueofparksandopenspaces

•EncouragecreativitybycontinuingtodevelopSanFranciscoasacenterforthearts

•StreamlinebusinessinteractionwithCitygovernment

•Increasebusinessoutreachandprivatesectorpartnerships

•BetterprepareSanFrancisco’syouthforcareers

Downtown San Francisco’s capacity to support more workers, through

enhanced transit investments that expand its regional accessibility,

may be critical to the region’s ability to grow in a sustainable way.

—San Francisco Economic Strategy

PRIORITY INVESTMENT FOR BAY AREA’S ECONOMIC FUTURE 23

B. Enhance Regional Connectivity and Competitiveness

Signiﬁcant evidence demonstrates that job density and proximity to transit

are more important in increasing transit ridership than housing density

and proximity to transit. Put simply, people are willing to travel farther

from their home to transit than from transit to their workplace.

—Urban Future of Work, SPUR

The Bay Area economy is becoming a regional network comprised of the major job centers throughout the

region. These job centers are generally located within three miles of a regional rail station, but less than one

quarter of all Bay Area jobs are within walking distance from rail stations. Studies show that transit proximity

to the workplace is of greater importance to transit riders than close proximity to their homes.

Therefore,

creating dense job centers near transit is an important component of efforts to increase transit ridership.

While the majority of Bay Area commuters still drive to work (often in single-occupant trips), commute patterns

show that this trend is declining where there is convenient and reliable access to transit. Strategic transportation

investments like the Transit Center are critical to encourage Bay Area commuters to choose transit over driving

and to obtain the full range of local and regional beneﬁts associated with better regional transit connections.

Business districts located near transit beneﬁt not only employees but also employers. Companies have found

that dense urban settings facilitate collaboration and the sharing of ideas and information, which promotes

business innovation and competitiveness. Research on business agglomeration shows that when businesses,

particularly those in the same business cluster, locate close to one another, their proximity generates multiple

beneﬁts, including increased productivity, innovation, and business formation.

As discussed above, companies

will pay more for ofﬁce locations near transit because doing so attracts talented workers who value streamlined

commutes to their homes and to other destinations. Demonstrating this trend, Twitter signed a lease in 2011

to move its ofﬁces to San Francisco’s Mid-Market District near the Civic Center BART Station, and Salesforce

leased 400,000 square feet of ofﬁce space in a new high-rise tower across the street from the Transit Center.

When the DTX is complete, the Transit Center will better connect workers throughout the region to downtown

San Francisco. The Transbay Redevelopment Plan and the Transit Center District Plan will catalyze the creation

of the Bay Area’s most dense employment center and residential neighborhood, helping drive regional growth

for years to come.

The Bay Area has maintained and increased its productivity edge over

the past few years by further specializing in key knowledge sectors. It is

home to more of the fastest growing companies than anywhere else in the

country and ranks in the top 10 regions globally.

—Innovation and Investment: Building Tomorrow’s Economy in the Bay Area,

Bay Area Council Economic Institute

24 TRANSBAY TRANSIT CENTER: KEY INVESTMENT IN SAN FRANCISCO’S FUTURE AS A WORLD CLASS CITY

C. Support San Francisco’s Position as a World Class City

Nearly 500 million more people will live in cities over the next decade, and

60 percent of the world population will settle in urban areas. Here is where

business, commerce and wealth creation happen. Expect international

city-to-city networks to form… serviced along increasingly well-traveled

global pathways.

—What’s Next? Real Estate in the New Economy, Urban Land Institute

Increasingly, cities are ranked according to global standards that measure their relative performance by

economic activity, knowledge/innovation, infrastructure robustness, quality of life, cultural activity, and political

inﬂuence. To remain globally competitive, the world’s top-ranked cities in Asia, Europe and the Americas are

making major investments in infrastructure, particularly in high speed rail, that connect these cities to the larger

region and enhance mobility, stimulate economic development, and protect the environment. Figure 9 below

shows how top ranked cities across the world are investing in high speed rail systems.

In recent surveys, San Francisco is ranked as one of the top 25 world class cities. Like other world class

cities, San Francisco must continue to invest in infrastructure, particularly in multi-modal transit facilities

like the Transit Center, which will enhance rail connectivity between business centers throughout California,

the United States, and the world. Furthermore, the development of the new Transbay neighborhood

as a sustainable, high-quality urban environment anchored by the Transit Center will create one of the most

unique and attractive employment centers and residential neighborhoods in the world.

FIGURE 9: TOP RANKED WORLD-CLASS CITIES (NOTE: CITIES LABELED IN RED HAVE HIGH SPEED RAIL ACCESS)

San Francisco

Chicago

Toronto

Los Angeles

Singapore

Sydney

Washington DC

New York

London

Paris

Zurich

Frankfurt

Beijing

Seoul

Tokyo

Shanghai

Hong Kong

Berlin

Brussels

Barcelona

Madrid

China’s high-speed rail system has emerged as an unexpected

success story. Economists and transportation experts cite it

as one reason for China’s continued economic growth when

other emerging economies are faltering.

—Keith Bradsher, The New York Times

PRIORITY INVESTMENT FOR BAY AREA’S ECONOMIC FUTURE 25

1. Long-Term Investments by Top-Ranked Cities

New York, London, Paris, Tokyo, and Berlin consistently rank at the top of world class indices, as these cities

are dynamic engines of growth, serve as hubs of global integration, and offer extensive regional and global

interconnectivity. As described below, not only are these cities making major transit investments, they are also

building new parks, creating other public amenities and implementing comprehensive plans to encourage

the development of iconic skyscrapers, transit-rich neighborhoods and dynamic centers of commerce.

San Francisco is ranked within the top 25 of world class cities

in recent surveys:

• InnovationCitiesGlobalIndex(#4),2thinknowCityBenchmarkingData,2012-2013

• GlobalCitiesIndex(#17)-A.T.KearneyandChicagoCouncilonGlobalAffairs,2012

• USandCanadaGreenCityIndex(#1),2011

• GlobalCitiesSurvey(#16),KnightFrankLLP,2011

• GlobalPowerCityIndex(#21),InstituteforUrbanStrategiesatMoriMemorial

FoundationinTokyo,2011

• GlobalCitiesIndex(#12),ForeignPolicyJournal,2010

World Trade Center Transportation Hub

Project, New York

Image credit: Port Authority of New York

and New Jersey

a. New York

New York City Transit, the largest public transportation system in

North America, has six million daily users on its 25 subway and

234 bus routes throughout the city’s ﬁve boroughs.

New York

City is connected to Long Island, upstate New York, Connecticut,

New Jersey, and the greater Northeast via Long Island Rail Road,

Metro North, PATH, NJ Transit, and Amtrak, as well as Greyhound

and other bus services.

To improve this network, New York City Transit is constructing

a new north-south subway line—the Second Avenue Subway—

to reach areas underserved by rapid transit. It is also improving

cross-town connections by extending the 7 Subway to the west

side of Manhattan and connecting the Long Island Rail Road to the

east side at Grand Central Station. Both cross-town improvements

will reduce travel times to the eastern parts of Manhattan, Queens,

and Long Island, which are home to many who work in Manhattan.

The world’s biggest, most interconnected cities help set global agendas,

weather transnational dangers, and serve as the hubs of global integration.

They are the engines of growth for their countries and the gateways to the

resources of their regions.

—The 2008 Global Cities Index, Foreign Policy Journal

26 TRANSBAY TRANSIT CENTER: KEY INVESTMENT IN SAN FRANCISCO’S FUTURE AS A WORLD CLASS CITY

One of the city’s key development projects is rebuilding the World

Trade Center complex. New York is taking a holistic approach

that incorporates a major transit hub, landmark architecture, and

signiﬁcant open space. The World Trade Center PATH Transportation

Hub will consist of a multi-story transit hall with links to the subway

system, Hudson River ferry terminals, and future JFK airport rail

link, as well as 200,000 square feet of retail. Upon completion,

the hub will be able to accommodate 250,000 daily passengers.

The World Trade Center complex will also provide high-rise ofﬁce

buildings, including a soaring tower—One World Trade Center

(104 stories, 2.6 million square feet)—designed by celebrated

architects Daniel Libeskind and David Childs and slated for

completion in 2014. The 9/11 memorial, an open space surrounding

the former World Trade Center towers, already provides a public

place for remembering victims and rescue workers.

New York is investing in additional open spaces. The High

Line Park converted a 1930s-era elevated freight rail line

into a 1.5-mile aerial greenway. Opened in 2009, the

High Line is now a major destination for both residents

and visitors to the city, featuring naturalized plantings,

public art, and seating areas that highlight views of the

city and Hudson River. It provides much needed open

space to dense urban neighborhoods along the West

side of Manhattan. The High Line has helped revitalize

surrounding neighborhoods. Property and business

owners, in particular, have gained from the additional foot

trafﬁc resulting from this public amenity, which has led to

higher property values and increased sales for businesses.

Similarly, the city has created public, pedestrian

plazas in sections of Times Square formerly dedicated to street trafﬁc and is building on this effort with a

planned $45 million transformation from “what is now painted asphalt into a world class urban piazza.”

b. London

The United Kingdom has committed major funds for key transportation

projects serving London and surrounding regions. These projects

include the $25 billion Crossrail, to be completed in 2017, which will

provide an east-west connection for passengers from central London

and the ﬁnancial district in Canary Wharf to Heathrow airport and the

eastern suburbs of London. The Crossrail will link to the subway system,

commuter rail, and inter-city and international rail, which include

high speed rail.

The UK is also investing $26 billion to provide rail connections from

the north and south of London into central city stations, as well as

linkages to the future Crossrail. Additionally, London will beneﬁt

from the $52 billion “High Speed 2” rail project, which will extend

high speed passenger service north from London to Birmingham by 2015,

with potential stops in Manchester, Leeds, and eventually Scotland.

World Trade Center Complex, New York

Image credit: Foster & Partners

The High Line Development, New York

Shard Tower, London

Image credit: Dave Catchpole, 2012

PRIORITY INVESTMENT FOR BAY AREA’S ECONOMIC FUTURE 27

In central London, just southeast of the London Bridge, lies the newly

redeveloped London Bridge Quarter, a mixed-use project anchored by

an iconic tower known as the Shard and the revamped London Bridge

subway and bus station. Completed in 2012, the Shard (72 stories,

1.2 million square feet), designed by the famous architect, Renzo Piano,

is the tallest skyscraper in Europe. The London Bridge Quarter will

include high quality ofﬁce, residential, and retail space, as well as a hotel

and new public green space. The improvements and reconﬁgurations for

the London Bridge tube and bus stations will complement the adjacent

transit oriented developments within the area.

On the eastern side of London are the long vacant Royal Docks and the site of the 2012 Summer Olympics.

The Royal Docks is a concentrated area of publicly owned land on the River Thames that is likely to absorb

much of the City of London’s future growth. Still in the planning stages, the Royal Docks is envisioned to be a

mixed-use neighborhood featuring high tech and innovation companies, along with a range of housing.

Just north of the Royal Docks is the newly created

Olympic Village and Olympic Parklands. As host of the

2012 Summer Olympics, London planned the buildings

and infrastructure needed for the Games in a manner

that can accommodate Londoners and visitors for years

to come. The 250-acre Olympic Parklands, for example,

is the largest open space project built in Europe for over

a century. Transit improvements that connect the Olympic

Village and Park with the Royal Docks and the rest of

London also include rail extensions, station upgrades,

and increased transit capacity.

c. Paris

The French government and City of Paris are investing in public transit projects to increase mobility

and access for the Greater Paris metro area. Part of the “Grand (or Greater) Paris” initiative

espoused by the city and federal government, a new rapid transit network encircling the city will

connect with existing rail networks to provide connections to the suburbs and a number of major

high speed rail stations and airports while fostering economic development in the Paris region.

The project is anticipated to begin service by 2018 with the entire network scheduled to be completed

by 2025. Former French president Nicolas Sarkozy took the position that “the economic crisis can only

be beaten by grand projects. There could be no grander project than to create a Greater Paris.”

The La Défense area, one of the largest dedicated

business districts in Europe and host to a large number

of Fortune 500 companies, is located on the western

end of Paris’s historic axis, with the Louvre at the other

end. This area will be connected to the Greater Paris

metro region and suburbs through future rail expansions.

La Défense holds many of the city’s tallest buildings and

high-rises like the modern Grande Arche. The Le Parvis,

an esplanade that runs through the district, provides a

public space for workers and visitors.

I want London to be

the best big city

on earth.

—Boris Johnson

Mayor of London

Olympic Park, London

Image credit: Jon Osborne, 2012

La Defense, Paris, incorporating future development of

Hermitage Plaza

Image credit: Foster & Partners

28 TRANSBAY TRANSIT CENTER: KEY INVESTMENT IN SAN FRANCISCO’S FUTURE AS A WORLD CLASS CITY

One of the latest development projects in La Défense,

the Hermitage Plaza will give rise to a new, mixed-use

community in the area of Courbevoie. A pair of towers

rising 1,049 feet high will provide housing and commercial

spaces, with shops and cafes as their base. The towers

will bookend a new pedestrian plaza, all of which will be

well served by nearby public transit.

The project recently

received planning permits to begin construction and

is expected to open by 2016.

d. Tokyo

Japan has one of the most efﬁcient and extensive public

transportation systems in the world, due to many years

of investing in its transit infrastructure, particularly the

rail networks that serve Tokyo, Nagoya, and Osaka, the

country’s three largest metropolitan areas. It was one of the

ﬁrst nations to successfully implement high speed rail in the

1960s to enhance mobility for its workers, residents, and

visitors. Japan continues to improve upon its high speed rail

system to increase the speed of its trains and implement the

latest technology. Japan’s next generation of bullet trains

are set to launch in 2025.

Tokyo Station City is a transit oriented development at a

major regional gateway and historic site. The Tokyo Station

Marunouchi Building, built near the turn of the 20th Century

and modeled after Amsterdam Central Station, is the major

focal point of the project. The station is one of the nation’s

busiest railway hubs and is a terminus of a high speed rail

line. Its facilities are currently undergoing renovation to add

retail space and a pedestrian deck—the “Gran Roof”—that

will provide outdoor space while connecting the station to

the GranTokyo North and South Towers (42 and 43 stories,

respectively, at a combined 3.8 million square feet).

Hermitage Plaza, Paris

Image credit: Foster & Partners

The economic crisis can only

be beaten by grand projects.

There could be no grander project

than to create a Greater Paris.

—Former French President Nicolas Sarkozy

Tokyo Station

Image credit: www.tokyobling.wordpress.com

Gran Roof, Tokyo Station

Image credit: Tetsudo Kaikan, 2009

PRIORITY INVESTMENT FOR BAY AREA’S ECONOMIC FUTURE 29

e. Berlin

In 2006, Berlin opened the city’s central multi-modal station,

the Berlin Hauptbahnhof. Serving almost 350,000 daily

passengers, the station is located on the former boundary of

West and East Berlin and its new glass structure represents

the openness and transparency to commemorate the fall of

the Berlin Wall.

At ﬁve stories and 753,000 square feet,

the main station is the largest rail station in Europe and

provides access between different transportation modes,

such as long distance trains, commuter rails, and buses.

The Hauptbahnhof also provides short bus connections

to the Tegel and Schoenefeld airports. The station contains

a shopping plaza for passengers and visitors as well as two

12-story ofﬁce towers with a combined 538,000 square feet.

Solar panels on the roof provide renewable energy.

Within a mile of the Hauptbahnhof are two mixed-use

developments. The 4.3-acre Station Quarter features

retail, ofﬁce, and hotel spaces. The 40-acre master-

planned Europa City is currently under development

just north of the train station. It is anticipated to have

6.5 million square feet of residential, commercial, and

cultural uses.

These transit oriented developments will

concentrate new higher density development around

the Hauptbahnhof.

2. San Francisco Transbay Transit Center: A Critical Investment

for the Future

As described above, world class cities across the globe are making signiﬁcant investments in transit, infrastructure,

parks, and walkable, dense neighborhoods that are creating new public and private development opportunities

around transit stations. To maintain its position as a cutting-edge, world class city, San Francisco must continue

to invest in innovative projects like the Transbay Transit Center and surrounding neighborhood to keep

San Francisco at the forefront of the ever-changing global economy.

America’s third century urgently requires a new strategy to lay the

foundation for the nation’s future competitiveness, sustainability, and

quality of life…[We must] promote integrated investments in mobility,

environment, and economic development….and provide capacity for

growth by creating a world class multimodal transportation system of

new smart highways, high-speed rail, airports, and seaports, all of these

linked to concentrated developments at central hubs.

—America 2050: A Prospectus

Hauptbahnhof, Berlin

Image credit: Marcus Bredt

30 TRANSBAY TRANSIT CENTER: KEY INVESTMENT IN SAN FRANCISCO’S FUTURE AS A WORLD CLASS CITY

CONCLUSION 31

CONCLUSION

Cities around the world are expanding their transit networks and

encouraging the development of dense urban neighborhoods

to remain competitive globally. New York, London, Paris,

Tokyo, and Berlin are all undertaking major transit investments

and implementing comprehensive plans to encourage the

development of sustainable urban communities that will serve

as future dynamic centers of commerce. The Transbay Transit

Center Project is San Francisco’s next big move and will similarly

strengthen its competitive position in the global economy.

The Bay Area is one of the world’s most robust business

centers and home to the nation’s most competitive knowledge

service sector. Research has shown that knowledge service

businesses thrive best in a compact, transit-rich environment.

The Transbay Transit

Center Project

is an inspiring and

forward-thinking

transit-oriented

development that will

transform downtown

San Francisco

and the Bay Area’s

regional transportation

system.

32 TraNSbay TraNSIT CeNTer: Key INveSTmeNT IN SaN FraNCISCO’S FUTUre aS a WOrLd CLaSS CITy

The Transbay Project will facilitate connectivity, collaboration, and the creation of dense employment clusters.

It will also result in the redevelopment of vacant and underutilized State-owned properties into $4 billion in

new transit oriented, mixed-income housing and commercial development on public property once occupied

by the former Transbay Terminal and abandoned freeway ramps.

The Transbay Project will also create a landmark multi-modal transit hub and vibrant new walkable neighborhood

featuring parks, public plazas, and active retail along tree-canopied streets. This will bring activity,

energy, and vibrancy to downtown San Francisco that will drive signiﬁcant property and other measurable

premiums. Together, the improved transit access, public spaces and neighborhood amenities provided by

the Transbay Project are projected to add an estimated $3.9 billion to the value of private properties located

within ¾ miles of the Transit Center.

The Bay Area region will also beneﬁt from reduced travel times, better human and environmental health,

an expanded labor market, new jobs, and increased economic output. The buildout of the Transit Center

and surrounding neighborhood are projected to generate up to $87 billion in Gross Regional Product and

$52 billion in personal income through 2030.

San Francisco is poised to make its next big mark on the world stage, and the Transbay Project is one of

its most important investments to assure San Francisco’s long term success in this increasingly global economy.

Regional planners need

to attempt to integrate

multimodal infrastructure

initiatives—including mass

transit alternatives—into

future land use schemes...

These networks will take

decades to build out, but

the time to start is now.

—What’s Next? Real Estate

in the New Economy, Urban Land Institute

“Transbay Tower Plans.” Hines and Pelli Clarke Pelli, 2012.

“Caltrain Downtown Extension and Transbay Ridership Analysis.”

Cambridge Systematics, Inc., 2008, page 6-9. Table 6.8 has been

adjusted to account for 6 trains per hour into the DTX. An average

of the ridership for 5 trains per hour and 7 trains per hour was taken,

resulting in a ridership of 31,550.

“California High-speed Rail Program Revised 2012 Business Plan.”

April 2012, pages ES-13, 2-31, 5-15 to 5-17, and 9-4.

According to 2011 US Census data from OnTheMap, jobs in

industry sectors that occupy ofﬁce space located in downtown

San Francisco represent about 78 percent of citywide jobs

(about 135,000 out of 172,000 citywide ofﬁce jobs).

Value estimates were prepared by The Concord Group (TCG).

TCG’s projections of land sales and development of the State-owned

properties (between 2013 to 2020) take into account downtown

market supply and demand dynamics as well as site strengths and

challenges in the greater regional context. Pricing and positioning

for each residential and commercial product type is determined

according to a rotating set of key market comparables, and reﬂect

the unique locational attributes of the Transbay parcels and their

role in the TCDP master planned urban community concept. Overall

valuations for residential parcels are calculated based on expected

average home prices at time of RFP issuances for the State-owned

properties. Inclusionary units in mixed-income parcels are valued

based on affordability levels for targeted households. For ofﬁce

parcels or mixed-use development parcels, capitalized value for

commercial uses is determined using projected net operating

income based on recommended rental rate positioning and

industry-driven operating cost inputs.

“Transbay Tower 309 Application.” Hines and Pelli Clarke Pelli, 2012,

page 3.

Transbay Redevelopment Plan and Transit Center District Plan

development calculations, Ofﬁce of Community Investment

and Infrastructure and City of San Francisco. The Transbay

Redevelopment Project Area has a 35 percent affordable housing

requirement, which will be achieved through a combination of

inclusionary and stand-alone affordable housing. Properties

within the Transbay neighborhood but outside of the Transbay

Redevelopment Project Area do not count toward this requirement.

The Transbay neighborhood, deﬁned by the Transit Center District

Plan and Redevelopment Plan, is anticipated to house more than

7,000 new residents, based on 1.6 person per housing unit,

and about 24,000 new employees, based on an average of

250 square feet per employee for commercial development.

Duncan, Michael. “The Impact of Transit-oriented Development on

Housing Prices in San Diego, CA.” University of North Carolina, 2010,

page 101.

“Caltrain Downtown Extension and Transbay Ridership Analysis.”

Cambridge Systematics, Inc., 2008, page 6-2, Table 6.1.

Diaz, Roderick B. “Impacts of Rail Transit on Property Values.”

Booz Allen & Hamilton, Inc., 1999, page 5.

US Census Bureau, OnTheMap Application and LEHD Origin-

Destination Employment Statistics, 2011.

“Urban Future of Work.” SPUR, January 2012, page 18, Figure 3.

Cervero, Robert. “Effects of Light and Commuter Rail Transit on

Land Prices: Experiences in San Diego County.” University of

California, Berkeley. December, 2003, pages 2 and 20.

Any uncertainty regarding future connection of high speed rail to

the Transit Center does not affect the estimated value premiums.

Most of the literature considers—and the estimated premiums

derive primarily from—proximity to transit used for frequent trips

covering shorter distances. Proximity to Caltrain through the DTX is

particularly important to the generation of potential premiums. (As

described on page 12, the analysis adjusts downward the potential

premiums reported in the economic literature.)

Harnik, Peter, Ben Welle. “Measuring the Economic Value

of a City Park System.” Trust for Public Land, 2009, page 1.

Existing and new development estimates (2013 Dollars) include

properties within ¾ of a mile of the Transit Center but do not include

State-owned properties. Value enhancement attributable

to State-owned properties will be captured by the TJPA in land sales

revenues and tax increment that will help fund the Transit Center.

Caltrain Downtown Extension and Transbay Ridership Analysis,

Cambridge Systematics, Inc, November 2008, page 6-9, Table 6.8.

Table 6.8 has been adjusted to account for 6 trains per hour

into the DTX. An average of the ridership for 5 trains per hour and

7 trains per hour was taken which resulted in 31,550 passengers.

The “No Project” alternative was adjusted down from

10 trains per hour to 6 trains per hour (18,540 passengers).

The difference was determined to be approximately 13,000 passengers.

“What’s Next? Real Estate in the New Economy.” Urban Land Institute,

2011, page 74.

“Transbay Transit Center Program Economic Impact Study.”

URS and Wilbur Smith, October 2009, page 56, Table 5.14.

“Transbay Transit Center Program Economic Impact Study.”

URS and Wilbur Smith, October 2009, page 38, Table 4.15

(low estimate safety cost savings).

“Transbay Transit Center Program Economic Impact Study.”

URS and Wilbur Smith, October 2009, page 100, Table 8.5.

“Transbay Transit Center Program Economic Impact Study.”

URS and Wilbur Smith, October 2009, pages 78-79, Studies of

Transportation Impacts on Welfare and Employment, and Table 7.1.

“Transbay Transit Center Program Economic Impact Study.”

URS and Wilbur Smith, October 2009, page 38, Table 4.15

(low estimate emission cost savings).

“Caltrain Downtown Extension and Transbay Ridership Analysis.”

Cambridge Systematics, Inc., 2008, page 7-4, Table 7.4. Approximately

60 percent of the daily reduction of carbon dioxide over the course of

260 commute days per year has been assumed which translates to

tens of thousands of tons of reduction in carbon dioxide annually.

“Addendum/Errata to Final Program EIR/EIS for the Bay Area to

Central Valley Portion of the California HST System.” US Department

of Transportation, June 2008, Table 9.3-1.

Litman, Todd. “Evaluating Public Transportation Health Beneﬁts.”

Victoria Transport Policy Institute, June 2010.

Litman, Todd. “Evaluating Public Transportation Health Beneﬁts.”

Victoria Transport Policy Institute, June 2010, page 1.

“Updated and Expanded Housing + Transportation Affordability

Index.” Center for Neighborhood Technology, February 2012.

http://www.cnt.org/tag/housing-transportation-affordability-hta-index/

Cabanatuan, Michael. “Transportation Boosts Cost of Living in

Suburbs.” San Francisco Chronicle, February 2012.

“Transbay Transit Center Program Job Creation.” Program

Management/Program Controls (PMPC) (Prepared for TJPA),

October 2009, Table: Transbay Job Creation By Year.

“Transbay Transit Center Program Economic Impact Study.”

URS and Wilbur Smith, October 2009, page 101, Table 9.1.

“Job Impacts of Spending on Public Transportation: An Update.”

Economic Development Research Group, Inc. (Prepared for

American Public Transportation Association), April 2009.

Job creation calculated as follows: Phase 1 and 2 at $4.196 billion

results in 125,880 jobs (“30,000 jobs are supported per billion dollars

of spending” (page ii)).

“Transbay Transit Center Program Economic Impact Study.”

URS and Wilbur Smith, October 2009, page 5, Table 1.1.

“Updated and Expanded Housing + Transportation Affordability

Index.” Center for Neighborhood Technology, February 2012.

http://www.cnt.org/tag/housing-transportation-affordability-hta-index/

“Urban Future of Work.” SPUR, January 2012, page 5.

“Sustaining Our Prosperity: The San Francisco Economic

Strategy.” ICF International, November 2007. The City’s economic

strategy (prepared for Mayor’s Ofﬁce of Economic and Workforce

Development) is intended to guide City policy and action to enhance

economic opportunities for residents and businesses as well as to

preserve and expand the City’s tax base.

“Sustaining Our Prosperity: The San Francisco Economic Strategy.”

ICF International, November 2007, page 84.

“Urban Future of Work.” SPUR, January 2012, page 25.

Kolko, Jed. “Making the Most of Transit: Density, Employment Growth,

and Ridership Around New Stations.” Public Policy Institute of California,

Fe bruary 2011.

“Urban Future of Work.” SPUR, January 2012, Page 33.

eNdNOTeS

aCKNOWLedgemeNTS

ARUP

CAMBRIDGE SYSTEMATICS, INC.

LOWERCASE PRODUCTIONS

NANCY WHELAN CONSULTING

PARSONS CORPORATION

PELLI CLARKE PELLI ARCHITECTS

SAN FRANCISCO CHAMBER OF COMMERCE

SAN FRANCISCO OFFICE OF COMMUNITY

INVESTMENT AND INFRASTRUCTURE

SAN FRANCISCO PLANNING DEPARTMENT

SAN FRANCISCO PLANNING AND URBAN RESEARCH

(SPUR)

SEIFEL CONSULTING, INC.

SHUTE, MIHALY & WEINBERGER LLP

SINGER ASSOCIATES

THE CONCORD GROUP

TRANSBAY JOINT POWERS AUTHORITY

TRULIA

URS CORPORATION

UNIVERSITY OF BERKELEY

DEPARTMENT OF CITY AND REGIONAL

PLANNING

FISHER CENTER FOR REAL ESTATE AND URBAN

ECONOMICS, HAAS SCHOOL OF BUSINESS

INSTITUTE OF URBAN AND REGIONAL

DEVELOPMENT

WILBUR SMITH

Porter, Michael E. “Clusters and the New Economics

of Competition.” Harvard Business Review, November 1998,

pages 77–90.

“Innovation and Investment: Building Tomorrow’s Economy

in the Bay Area.” Bay Area Council Economic Institute, March 2012,

page 1.

“What’s Next? Real Estate in the New Economy.” Urban Land Institute,

2011, page 111.

Bradsher, Keith. “Speedy Trains Transform China.”

The New York Times, September 2013.

“The 2008 Global Cities Index.” Foreign Policy Journal, October 2008.

http://www.foreignpolicy.com/articles/2008/10/15/the_2008_global_

cities_index

“Investing in NYC.” New York City Department of Housing

Preservation & Development, http://www.nyc.gov/html/hpd/html/

buyers/nychome-investing.shtml

“Transportation Hub.” World Trade Center, http://www.wtc.com/

about/transportation-hub

“Highline Revenue Generation Study.” Bay Area Economics/NY City

Economic Development Corporation, February 2007.

“Times Square Transformation.” Countdown to a New Times Square,

Justin Davidson, New York Magazine, April 2012, http://www.

timessquarenyc.org/live-work/times-square-transformation/

index.aspx

Stirling, Will. “HS2 Go-ahead Conﬁrmed, Machine Tool Firms Braced

for Details.” The Manufacturer, January 2012.

“The 2012 Olympics, Royal Docks Trust Development Update.”

http://www.royaldockstrust.org.uk/rdteam.html

“The ‘Greater Paris’ Project.” Invest in France Agency, Paris, 2011.

“Hermitage Plaza.” Foster+Partners, http://www.fosterandpartners.

com/Projects/1727/Default.aspx

Smith, Stephen. “Paris’s La Défense Again Reaches For The Sky

With Hermitage Plaza.” Art & Design, March 2012.

McCurry, Justin. “High-speed Rail in Japan: From Bullets to Magic

Leviathan.” The Guardian, August 2009.

“GranTokyo North Tower and GranTokyo South Tower Completed.”

JR East Japan Railway Company,

http://www.jreast.co.jp/e/press/20071001/index.html.

Fuller, Frank. “Designing the High-speed Future.” Next American

City, March 2011.

Baker, Jo. “Berlin Central Station.” Architecture Week,

November 2006.

Fuller, Frank. “Designing the High-speed Future.” Next American City,

March 2011.

“America 2050: A Prospectus.” Regional Plan Association, New York,

September 2006, page 3.

“What’s Next? Real Estate in the New Economy.” Urban Land Institute,

2011, page 74.

TRANSBAY TRANSIT CENTER:

KEY INvESTmENT IN SAN FRANCISCo’S FuTuRE

AS A WoRld ClASS CITY

TRANSBAY JoINT PoWERS AuThoRITY

NovEmBER 2013

201 Mission street, suite 2100

san Francisco, ca 94105-1858

415-597-4620