Transit oriented development (TOD): The complexity of TOD decoded

17th September 2018

Imagine there was a way to deliver high-quality modern housing with fantastic transport links whilst also reducing traffic congestion, urban sprawl and dangerous emissions. Now imagine that all of this was possible with reduced up-front government investment and that the project to develop these features could eventually be financially self-sufficient. Whether you are a government institution, a real-estate developer, project financier, construction contractor, a provider of rail infrastructure or simply a citizen, you might like to know how this is all possible.

Transit Oriented Development (TOD) is a way of developing, financing and delivering transport infrastructure projects. It has gained popularity – particularly in the Far East and parts of the United States – over the last 15 years. This popularity is set to soar as project owners and governments continue to search for novel ways of financing transport infrastructure developments.


TOD is a planning and design concept that aims to integrate transport infrastructure with major urban development. By creating high-density, vibrant communities located directly adjacent to new transport hubs, local government, project owners and other project stakeholders can harness the social, environmental and economic benefits.

The TOD model works because of the proximity of the newly developed amenities, housing and retail connecting transport links which all boost the local economy. TODs can provide employers will access to a larger number of skilled workers within a narrower catchment area; retailers have a greater number of customers frequenting their shops and making purchases and transport operators have more customers paying for and using their services. When designed and implemented well, these schemes create vibrant communities and an increased demand for TOD housing follows, ultimately resulting in higher house prices within the TOD catchment area. This increased value can then be captured – often in the form of a tax – and used to pay back the initial project capital outlay and to finance the ongoing operations of the scheme.

The TOD model is not universally applicable. There are a limited number of scenarios in which it can work. However, the adoption of TOD has proliferated in recent times due to the potential for large-scale social and economic benefits. Iconic TOD schemes can be found in metropolises like Hong Kong, as well as smaller cities like Copenhagen and Stockholm.


No two TOD developments are the same, and each potential scheme must be considered on its own merit. However, there are six guiding principles to consider:

1. Create a walkable layout with the pedestrian considered the highest priority.

2. Ensure the transport hub (or hubs) are a prominent feature of the town centre and attract people; if possible, locate the public square directly adjacent to the station.

3. Look to include a mixture of different land uses in close proximity (office, residential, retail and civic).

4. Promote a high-density design in which most services are within a 10-minute walk of the transport hub; promote active transport. This may involve reducing and strictly managing parking within the 10-minute walk catchment area.

5. Install periphery and collector support transit systems like street-cars, buses and light-rail to support the primary transport hub.

6. Incorporate specialised commuter-friendly retail facilities – cafes, grocery and dry cleaners – within the stations.

The TOD model offers project owners, developers and governments an opportunity to deliver modern world-class infrastructure in a more integrated and cost-effective manner.”
Chuks Nwabineli, Advisory,, HKA

In the right environment, the TOD model offers project owners, developers and governments an opportunity to deliver modern world-class infrastructure in a more integrated and cost-effective manner. In order to make TODs work, various stakeholders must commit to a collaborative working relationship through every stage of what will be a complex process. They must also retain a strategic long-term view in the face of inevitable shortterm challenges. Finally, in light of the scale and complexity of commercial agreements underpinning the model, they must be able to rely on a robust and mature legislative framework. For this reason, the TOD model is not for everyone – but as more schemes are successful, TOD as a means of efficiently developing infrastructure looks set to grow.