Development Benefits of Minneapolis’ Blue Line Scrutinized

A new paper in the Regional Science and Urban Economics journal presents a lukewarm review of the Minneapolis Blue Line’s impact on development through 2010—doing little to buoy the market during the Great Recession.
March 28, 2014, 10am PDT | James Brasuell | @CasualBrasuell
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Adam Belz reports on a new paper by Sarah West and Needham Hurst that will be published in Regional Science and Urban Economics finding that the Blue Line created “almost no increase in the likelihood of new development up to 2010” for the lights rail line that has connected Downtown Minneapolis and the Mall of America since 2004.

To sum the paper’s lackluster review of the development impact of the line: “They found ‘no effect’ along the corridor compared with the 1997-2000 period before construction started on the rail line, and found that parcels within a half-mile of rail platforms were only 1.39 percent more likely than parcels citywide to be developed after the line started operating, compared with the years the rail line was under construction.” For the record, the new report’s findings contradict the narrative about the rail line’s impacts from 2006.

“The paper also finds that light rail failed to insulate the corridor from the effects of the Great Recession,” writes Belz. A quote from West furthers that point: “If the light rail has a catalyst effect, we would still expect for there to be relatively less of a hit taken within the corridor, and we don’t find that…”

In the period following the paper’s purview, anecdotal evidence seems to suggest that the corridor’s stagnancy is improving. “West and Hurst are careful to point out that their paper does not address development since 2010 — ‘casual observation of activity along the line in 2012 and 2013 suggests that substantial changes are taking place now that market outlooks have improved,’ they wrote — and that the effects of light rail can take a long time to manifest themselves.”

Belz cites the study as a cautionary tale ahead of the soon-to-be-completed Green Line, which will shuttle riders between Downtown Minneapolis and St. Paul.

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Published on Wednesday, March 26, 2014 in Minneapolis-St. Paul Star Tribune
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