The Indianapolis Neighborhood Housing Partnership has purchased three more sets of properties strategically located by IndyGo bus lines in its quest to spur the development of affordable housing near the routes.
The acquired properties—located at the former headquarters of retail developer Sandor at 22nd and Meridian Streets, the northwest corner of 25th and Delaware streets, and the northeast corner of New York and Rural streets—are the latest acquisitions in INHP’s $15 million Equitable Transit-Oriented Development Fund.
The fund was launched February in collaboration with Michigan-based Cinnaire, a community development financial institution with offices in Indianapolis, which will manage the fund. At that time, INHP announced it had already purchased 401 E. Southern Ave. near Garfield Park and 2163 N. Illinois St.
Real estate agent Joe Lackner is well-versed in the Garfield Park neighborhood.
He
knows to talk up the elements that make the south Indianapolis area
special: the strong community, the summer farmers markets and the
popularity of First Friday at the Tube Factory.
But
another major upcoming amenity is poised to bring even more attention
to the area: the Red Line. Lackner said the bus rapid transit
system, which will run down Shelby Street from Fountain Square, cutting
through Garfield Park and Bean Creek, has “added to the frenzy” of the
developing neighborhood.
“We
have already seen the values in Garfield escalate considerably due to
the high prices in Fountain Square and now Bates-Hendricks driving first
time buyers our way,” he said.
(Photo: Michelle Pemberton/IndyStar)
Construction materials are laid out down College Ave. in Indianapolis as construction crews build infrastructure for the Red Line bus route on Thursday, March 28, 2019. The Red Line will run from Broad Ripple to downtown Indianapolis, to the University of Indianapolis and more.
Lackner
said the last two homes he sold in Garfield Park had multiple offers in
less than one day. Some homes that are priced right and in good
condition will go before he can even put up a sign. Three years ago,
these homes were priced at an average of $90,000. Now they are selling
for $130,000 or more, Lackner said.
The 13-mile bus rapid transit (BRT) corridor runs from Broad Ripple down to the University of Indianapolis, passing by plenty of single-family housing along the way, particularly on College Avenue and the south side. In general, experts expect the Red Line will have a positive effect on home values along the route.
Katie
Wertz is a senior associate for Greenstreet Ltd., an Indianapolis real
estate development, brokerage and consulting firm that helped IndyGo and
the Indianapolis Metropolitan Planning Organization (MPO) determine the
locations for Red Line stations. Wertz said she believes once
neighborhoods develop the right mix of amenities, which can include
transportation, housing prices will likely increase.
In
2018, the Metropolitan Indianapolis Board of Realtors (MIBOR) and
MPO conducted the Community Preference Survey, reaching 2,163 adults in
central Indiana aged 18 or older. Results showed that most respondents
had little interest in living in residential-only areas and preferred
living in mixed-use neighborhoods with amenities like shops and
businesses.
Twenty-seven percent of respondents were satisfied with the availability of public transportation where they live, while 34 percent were pleased with the shops and restaurants within walking distance of their homes.
“What
we’re seeing in the market both national and locally is a rising demand
for places that are walkable and mixed-use with mass transit places,”
she said. “We don’t have a lot of those places.”
An amenity for buyers
John
Creamer, a real estate agent with Century 21, said some of his clients
purchased homes specifically to be close to the Red Line. He points to a
couple from Chicago who frequently rides public transportation and
looks at the BRT as a plus.
He said the average
price of a home on College Avenue three years ago was $205,000, while
the average price in the last 12 months was $247,000. Creamer believes
some of that increase is directly affected by the opening of the Red
Line.
“The market has been good,” he said. “There
are so many desirable businesses on College (Avenue), mostly
community-oriented restaurants and pubs that people can walk to.”
Creamer
said the Red Line construction hasn’t deterred certain home buyers, who
are looking to the long term and making decisions based on what the
area will eventually look like.
“When people
purchase a home or even lease, looking at the next 5 years purchase,
that construction is obvious, some people know it’s coming for sure, for
those people want to get downtown IU medical center, know they can get
on it this coming September.”
Chris Pryor, vice
president of government and community relations at MIBOR, said he sees
similarities in the Red Line to the development of the Monon Trail,
which saw a 10-mile stretch in Indianapolis completed in 1999, and
Cultural Trail, which was finished in 2013.
“When
they were proposed, people objected to them and thought they would have a
negative impact on property values,” he said. “The opposite has been
true for those, and it’s seen as a premium for homes on those trails or
in close proximity.”
Few construction concerns from buyers
Peter
Stewart, an independent broker, is selling a property on College Avenue
and 55th Street with an asking price of $225,000. While there’s
construction out front, he hasn’t run into any issues.
“I
thought it was going to have more of an impact than it has,” he said.
“We’ve been listed for about five months and I haven’t had one negative
comment.”
He thinks most prospective buyers understand the location and go into showings well aware of the construction.
“I’ve
been in the business for over a decade, and see things like this as a
big plus,” he said. “It’s a big pain in the butt while they do the work,
but you’re seeing the benefits in the long term.”
(Photo: Michelle Pemberton/IndyStar)
Construction cones sit around a sewer grate along College Ave. in Indianapolis where construction crews are building infrastructure for the Red Line bus route on Thursday, March 28, 2019. The Red Line will run from Broad Ripple to downtown Indianapolis, to the University of Indianapolis and more.
Kelly
Lavengood, real estate agent for Plat Collective, said the increase of
average sales price from 2017 to 2018 was 10.5 percent for College
Avenue and the two blocks on either side of the street. The days a
property was on the market also decreased.
Lavengood
personally purchased a commercial property on Central Avenue and 38th
Street that will become her new office, and she said its location on
both the Red and Purple lines were factors in her decision.
“People
moving into neighborhood are really aware of Red Line project and
excited about it,” she said. “For the most part, people moving in are
planning to use it in some capacity.”
Stewart has a
different take. He said home buyers in the area purchasing homes of
“$200,000 or more” are “typically not going to be bus riders.”
Will homeowners use the Red Line?
Some
current homeowners are also skeptical. Perry Hammock, 65, has lived
on Central Avenue and 54th Street for 30 years, and he is only a few
blocks away from the Red Line.
“I don’t see the Red
Line in any way helping my property value,” he said. “You can take the
bus Downtown now and the (Red Line) might only save you five minutes. I
don’t know if it will help change much at all.”
As
for riding the Red Line himself, Hammock doesn’t see many reasons why
he would use it. He said he wouldn’t be able to get directly to some of
the places he usually goes Downtown, and it would only take him a few
more minutes to drive.
For others, the uses of the Red Line seem clear.
Tim
Treat, 31, purchased a home in March 2017 on 49th Street and Guilford
Avenue, which puts him several blocks away from two Red Line stops. He
and his wife supported the 2016 public transit ballot referendum that increased income taxes to help fund the Red Line.
“I’m
excited about the Red Line potential to build up the transit corridor
developing along College (Avenue), which adds significantly to our home
values,” he said. “Having more options to get around the city attracts
more diverse more people to the area. That will also bring more
development and more stuff to do, more restaurants and more things we
want and need in the neighborhood.”
He and his wife
work at IUPUI and drive separately because they have different
schedules. They don’t currently use the bus because “it’s unreliable for
a Downtown commute,” and he said it would take him “over an hour” to
get to work.
He also sees the Red Line as a positive for the overall community.
“People
who don’t have cars currently rely on underfunded and unreliable bus
system,” he said. “This has the ability to reach more jobs, which will
possibly increase their ability to earn. I don’t look at it as something
just for people who currently drive.”
How BRT has affected other cities
A
number of real estate agents and housing experts are optimistic about
the bus line attracting buyers and potentially raising housing prices,
particularly on or near the route. Sean Northup, deputy director of
MPO, believes there will be a positive impact.
“Transit
is a market enhancer, not necessarily a market maker,” he said. “Based
on observations from other cities, we absolutely expect more buyer
interest closer to the corridor, and we’ll probably see higher prices
after the transit line is built than before.”
(Photo: Michelle Pemberton/IndyStar)
Construction materials are laid out down College Ave. in Indianapolis as construction crews build infrastructure for the Red Line bus route on Thursday, March 28, 2019. The Red Line will run from Broad Ripple to downtown Indianapolis, to the University of Indianapolis and more.
In
2017, the National Institute for Transportation and Communities
(NITC) published a study from the University of Florida that focused on
single-family home sales near the Lane Transit District’s Emerald
Express BRT service in Eugene, Oregon. For every 100 meters closer to a
station, researchers found an increase of $823 to a home sale’s price in
2005, $1,056 in 2010, and $1,128 in 2016.
The Greater
Cleveland Regional Transit Authority has also been beneficial to home
values, according to a 2019 study from Cleveland State University. The
GCRTA features buses, including BRT, light rail and trolleys. The
study discovered neighborhoods that gained transit saw a 3.5 percent
increase in property values within a decade. It also found that
employment increased by 3.1 percent, and poverty decreased by 12.9
percent.
Wertz said that national research shows
that most of the increase of property values tends to happen from when a
transit line is announced to when it opens. But Indianapolis might be
different.
“Indianapolis is not known for its
transit system, so it may take longer for people to see the benefits of
living on or near the transit line, in order to raise property values,”
she said.
Kellie Hwang is a reporter at IndyStar. You can email her at kellie.hwang@indystar.com. Follow her on Twitter: @KellieHwang.
INDIANAPOLIS – Today, the Federal Transit Administration released its Small Starts funding recommendations for the 2017 federal fiscal year including a $75 million award for the construction of IndyGo’s Red Line Bus Rapid Transit (BRT) project. The grant adds to more than $40 million in successful competitive federal funding opportunities for IndyGo since 2012.
