With plans for GO transit to expand throughout the province, including discussions of the GO train coming to Niagara, this could be very useful information for developers looking to build around new transit hubs.
The study found that tenants in office spaces were more willing to pay larger premiums when the office was located close to transit. For the above reasons, many developers are now looking at transit development plans when choosing where invest and develop commercial spaces.
GTA proves it works
The study looked at eleven different markets in downtown Toronto and the surrounding suburban areas. The study found that the office buildings which were located within 500 metres of a transit hub, specifically rapid transit, all had vacancy rates that were 6.5 per cent lower than buildings which were outside of that range, which had vacancy rates of 12.1 per cent.
These office spaces are more profitable as well, the average rental rate for commercial spaces near transit were 38 per cent higher than a building not located near transit.
The analysis of the Toronto area focused on the Young Street corridor, which at one point had very little transit access, but now 83 per cent of office buildings within the area are half a kilometre, at most, away from a subway station. This increase in transit access has resulted in an industrial growth; the area has grown to 8.5 million sq. ft. of office space surrounding the main three subway stations in the area.
What this means for development in Niagara
While Niagara doesn’t have a subway system, the discussions of more access to GO transit within the region could point to more development. Niagara benefits from lower commercial real estate values, signalling a potential boom in commercial development if more rapid transit was introduced.
The region also recently announced an investment of $15 million into bettering the regional transit system, with a goal of creating a more cohesive inter-municipal transit structure to increase regional growth. Niagara may not see the benefits of rapid transit of a subway in the near future, but there has been a growth surrounding transit hubs in the region.
GO Transit’s proposal to build a station coming into the Casablanca area in Grimsby has brought an increase in growth to the area. This area has been one of the areas of the most growth and development in Niagara, seeing commercial development and condo development. The marketing of these new developments focuses on their location’s proximity to the proposed GO Station.
