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Three R+P projects around the world

We take a look at three major rail-plus-property (R+P) projects that are transforming city life.

17 October 2018

We take a look at three major rail-plus-property (R+P) projects that are transforming city life.

Shenzhen, China

In late 2017, Hong Kong’s Mass Transit Railway (MTR) Corporation completed its first major rail-plus-property (R+P) project outside Hong Kong, just over the Chinese border in Shenzhen. Named “Tiara”, the scheme was developed above and around the rail depot for the Shenzhen Metro Line 4, which MTR also operates. At around 2.15m ft2 (200,000 m2), Tiara provides around 1,700 apartments in nine residential towers and lower-level residences, along with 107,640 ft2 (10,000 m2) of retail space and a central garden of the same size.

MTR’s David Tang MRICS believes the reason why Tiara has been such a commercial success is because the R+P was implemented “from the drawing board” – before design is completed and ground is broken. In some other countries, including China, models similar to R+P are being attempted, but while different phases of development are under way.

“The live railway operating environment makes it a much more difficult challenge to get the scheme built,” says Tang.

Sydney, Australia

Increasing numbers of representatives of countries and cities around the world are visiting Hong Kong to understand the R+P model, and to see if it can be adapted to their own situational constraints for railway construction.

“Because it is a funding model, it is an exemplar for raising funds,” says Tang. In Sydney, the R+P model is called ‘value capture’. “What’s interesting here is how, before any development begins, a huge consultation is undertaken with the market on whether an above-ground development can really be achieved,” he adds. “This helps set out the parameters of future funding.”

When service commences in 2019, MTR will run Sydney Metro Northwest, a rapid-transit line that does not include any property development rights. However, the company hopes to win contracts for the extension of the line, which will run under Sydney Harbour and through the CBD, and factors in provision for R+P development above the stations.

London, UK

The cash-strapped UK government has long been eyeing elements of R+P to fund future infrastructure investment – none more so than with Crossrail, which will be the first UK project to integrate stations with over-site developments (OSDs).

Crossrail’s impact studies found that by 2021, these OSDs could add 18% (or £5.5bn) to the value of properties less than 1km from stations. However, critics argue R+P may not be so easy to replicate in the UK, especially because the government does not own all the land in the zones of influence surrounding transport schemes.

MTR has been working jointly with Transport for London since 2015, running the 20-mile Liverpool Street to Shenfield section of Crossrail, which will be extended across London from December this year and become the Elizabeth Line. In May this year, MTR appointed a new European head of property, John Robinson MRICS, to aid the company’s drive to win contracts for rail-related property sites.

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