New line of revenue: Streetcar route development favors independent business owners

Tuesday, January 31, 2017

by Molly M. Fleming

The Journal Record

Gallup Map & Art Co. owner Pat Carroll has been reshaping the product he’s offering in his Kansas City, Missouri store.

The store has been in downtown since the 1960s. In the late 1980s, Carroll considered moving. The area had changed from having bustling Saturday mornings to being quite empty.

But he heard about the then-developing Power & Light District and that Union Station was going to be renovated. He thought he should stick around for those new projects.

In 2013, Kansas City announced it would build a streetcar line, which opened in May 2016. Carroll’s business is on the route. His foot traffic has increased and he’s even reshaping the store’s product line. He often hears that people saw the store while on the streetcar, and then they return to buy something.

“I’m trying to re-create some products that catch people’s eyes,” he said. “I’m trying to come up with new ideas that are priced for an impulse buy. I’m trying to take advantage of the fact that there are more people seeing my products.”

Oklahoma City businesses along the streetcar route could see the same results, said D.J. Baxter, a streetcar development consultant from Salt Lake City. He said the streetcar will increase walkability, which in return creates higher retail sales. Those purchases are made at smaller, local businesses and restaurants.

“People on foot buy more and more often,” he said Wednesday at the Leadership OKC Alumni Association luncheon.

Baxter said the streetcar will help with redevelopment efforts because people see the lines as permanent. Bus routes can easily change.

“The installation of the tracks in the street emphasizes permanent interest in development in downtown,” he said.

Early indications are that development is 4.5 times more likely along the streetcar line than it would be without the system, said Nicolle Goodman, director of redevelopment programs for the Alliance for Economic Development of Oklahoma City. She said development is two times greater up to three blocks away from the line than it would be without the streetcar. She also spoke at the LOKC luncheon.

But the streetcar isn’t the city’s first. The city had a streetcar until the 1940s. The lines were covered or removed as the streets were updated.

Baxter said this generation’s streetcar line development is being fueled by two groups that are moving into downtown: baby boomers and millennials. They want to be in walkable, urban communities.

At the American Institute of Architects-Central Oklahoma’s monthly luncheon, Baxter said that baby boomers want to be near arts, restaurants, and medical centers so they don’t have to drive.

“For the millennials, it’s a vibe,” he said. “There’s a lot of culture to be found around downtown. Their living preferences will drive real estate for as far as we can see.”

Developer Gary Brooks invested in real estate along the streetcar line when he and his partner Charlie Nicholas purchased the First National Center. He said the streetcar and the park are the MAPS 3 projects that he’s excited about the most. He rode the streetcar in Portland all the way to line’s end.

“What I discovered in Portland is it really moves people around,” he said. “It’s an amenity.”

He said he’ll be a vocal proponent for expanding the line because it needs to run from the Wheeler District to Uptown 23rd Street.

“You just can’t have this one little loop here,” he said.

He even made a provocative statement about downtown: The streetcar could be the tipping point to get a grocery store in the area.

But people won’t be buying their groceries in the central business district unless the streetcar does what it’s expected to do. Baxter said a key for the project is to think what the city is trying to accomplish. It shouldn’t be to get people quickly across town.

“What streetcars really do well is to stimulate pedestrian activity,” he said.

In cities nationwide, the routes built between 2001 and 2008, ranging in length from 1.6 to 8 miles, have generated returns on investment starting at 750 percent. In Kansas City, the 2.2-mile route has created a 1,764-percent ROI.

“There’s a cool vibe going on,” Baxter said. “It’s largely because the streetcar had a big impact on that. That’s the primary reason I know of personally.”

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