Financing Transit-Oriented Development with Land Values Adapting Land Value Capture in Developing Countries

OVERVIEW OVERVIEW Public Disclosure Authorized hat the literature has long been missing is a thorough, thoughtful book that translates how to Wmove land value capture from the ivory towers of theory to real-world implementation. This book FINANCING comes as close to any in achieving this. It shows that land value capture holds tremendous untapped potential as a viable and sustainable funding source for public transit improvements and leveraging TRANSIT-ORIENTED transit-supportive growth, particularly in developing cities. — Robert Cervero, Friesen Chair of Urban Studies and Professor of City and Regional Planning at the University of California, Berkeley DEVELOPMENT WITH his book will help cities in emerging economies, and those of us working with them, to tap into the Tincreases in land value resulting from the economic development stirred by public investments in LAND VALUES infrastructure, providing opportunities to finance further public investment in infrastructure in a virtuous cycle. This provides finance but also helps structure more sustainable cities through complementary Adapting Land Value Capture land use regulations, furthering the virtuous cycle of financial, environmental, and social sustainability. Public Disclosure Authorized in Developing Countries — Holger Dalkmann, Acting Global Director, Transport and Cities; Director, EMBARQ; World Resources Institute Hiroaki Suzuki, Jin Murakami, Yu-Hung Hong, and Beth Tamayose hat a timely and important book! It makes an impressive contribution to urban planning literature, Wbridging theory and practice in transit-oriented development and offering much needed practical advice on how to structure and execute land value capture mechanisms to finance infrastructure investment. It is invaluable for all city planners and public investors, providing pragmatic guidance based on thorough analysis of successful efforts in Hong Kong [SAR, China] and Tokyo and emerging efforts in places like São Paulo, Nanchang, and Hyderabad. Bravo! — George W. McCarthy, President and CEO, Lincoln Institute of Land Policy his book identifies enabling factors from the experiences of Tokyo and other cities in promoting Public Disclosure Authorized Tprivate sector railway construction and operation with revenues from development rights sales or leases around transit stations, so-called “land value capture” (LVC). Also addressed are the risks and challenges in applying the LVC apparatus to other cities. This book provides rich experiences of many cities and deserves to be an essential reference for development agencies, including the Japan International Cooperation Agency (JICA), to address transportation in megacities in developing countries where public transit is needed as the backbone of urban development. — Junichi Yamada, PhD; Senior Special Advisor of Japan International Cooperation Agency (JICA) Public Disclosure Authorized SKU 32876 OVERVIEW Financing Transit-Oriented Development with Land Values Adapting Land Value Capture in Developing Countries Hiroaki Suzuki Jin Murakami Yu-Hung Hong Beth Tamayose This booklet contains the Overview and a list of contents from the forthcoming book, Financing Transit-Oriented Development with Land Values: Adapting Land Value Capture in Developing Countries (doi: 10.1596/978-1-4648-0149-5). A PDF of the final, full-length book, once published, will be available at https://openknowledge.worldbank.org/ and print copies can be ordered at https://publications.worldbank.org/. Please use the final version of the book for cita- tion, reproduction and adaptation purposes. © 2015 International Bank for Reconstruction and Development / The World Bank 1818 H Street NW, Washington, DC 20433 Telephone: 202-473-1000; Internet: www.worldbank.org Some rights reserved 1 2 3 4 17 16 15 14 This work is a product of the staff of The World Bank with external contributions. The findings, interpretations, and conclusions expressed in this work do not necessarily reflect the views of The World Bank, its Board of Executive Directors, or the governments they represent. The World Bank does not guarantee the accuracy of the data included in this work. 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All queries on rights and licenses should be addressed to the Publishing and Knowledge Division, The World Bank, 1818 H Street NW, Washington, DC 20433, USA; fax: 202-522-2625; e-mail: [email protected]. Cover photo: © Japan Railway Construction, Transport and Technology Agency (2013). Used with permission; further permission required for reuse. Contents Contents of Financing Transit-Oriented Development with Land Values iv Acknowledgments v About the Authors ix Abbreviations xi Glossary xiii Message to City Leaders xvi Overview 1 Car-Dependent Urban Development in the Developing World 2 Development-Based Land Value Capture as a Strategic Apparatus for Transit Financing and Urban Planning 2 Global Good Practices for Development-Based LVC 5 Critical Factors for Success in Developing Countries 12 Challenges and Risks 25 Roadmap for Development-Based LVC Implementation through a Gradual Approach 26 What International Development Financial Institutions Can Do 27 Conclusion 28 References 29 iii Contents of Financing Transit-Oriented Development with Land Values Acknowledgments About the Authors Abbreviations Glossary Message to City Leaders Overview Part I Introduction 1 Development-Based Land Value Capture for Financing Transit-Oriented Development 2 Theory of Land Value Capture and Its Instruments Part II Lessons Learned From Global Development- Based Land Value Capture Practices 3 Rail Plus Property Program, Hong Kong SAR, China 4 Inclusive Land Value Capture Schemes, Integrating and Regenerating the World’s Largest Metropolis—Tokyo, Japan 5 Development-Based LVC Practices in North America and Europe: New York City and Washington, DC, United States; and London, United Kingdom Part III Emerging Development-Based Land Value Capture Practices In Developing Countries 6 Financing a Metro with Development Rights of Public Land, Nanchang, China 7 A Tale of Two Metro Cities: Delhi and Hyderabad, India 8 Air Right Sales, São Paulo, Brazil Index iv Acknowledgments his book was written by Hiroaki Suzuki of the World Bank, Jin TMurakami of the City University of Hong Kong, Yu-Hung Hong of the Massachusetts Institute of Technology, and Beth Tamayose of the University of California, Los Angeles. It draws on case studies of Hong Kong SAR, China; Tokyo, Japan; New York City, NY, United States; Washington, DC, United States; London, United Kingdom; Nanchang, China; Delhi, India; Hyderabad, India; and São Paulo, Brazil. Steve Yiu, Rebecca Wong, Lam Chan, and Eureka Cheng (MTR Corporation) provided assistance in preparing the Hong Kong SAR, China, case study. The Tokyo, Japan, case study was developed with support from numerous individuals and organizations: Takeshi Nakawake, Wataru Tanaka, Kiyoyoshi Okumori, Shigeru Yokoo, Takashi Uchiyama, and Taro Minato (Nikken Sekkei, Ltd.); Hironori Kato (The University of Tokyo); Hisao Uchiyama (Tokyo University of Science); Masafumi Ota, Munehiko Shibuya, and Toshiyuki Tanaka (Tokyu Corporation); Katsunori Uchida and Tamotsu Kamei (Tokyu Land Corporation);

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