Project: South Lake Union Streetcar

1.0 Synopsis

The South Lake Union Streetcar connects the South Lake Union neighborhood to downtown Seattle, Washington. Construction of the project began in 2006, and service started in December 2007. One of two modern streetcar lines built for the developing transit system of Seattle, the South Lake Union Streetcar was constructed by the Seattle Department of Transportation (SDOT), is owned by the City of Seattle, and is operated and maintained by the Metro Transit Division of King County Department of Transportation.

The Seattle City Council approved the South Lake Union Streetcar plan in 2005, along with a localized taxing mechanism that paid for $25.7 million of the plan’s $48.2 million (in 2006 dollars) construction cost. The final cost of the project was $63.4 million (in 2013 dollars) due to additional utility work needed after the line opened.

The primary purpose of the project was to encourage investment in the South Lake Union neighborhood and decrease traffic congestion during commuting hours. After a free ride period in December 2007, nearly 1,400 riders were reported per weekday. Ridership increased significantly in 2010, due in large part to Amazon.com’s new campus in the South Lake neighborhood. In 2012, nearly 2,500 commuters used the streetcar to get to downtown Seattle every weekday. New businesses and developments in the area have created an estimated 1,227 jobs as a direct result of the South Lake Union Streetcar project; more than 60% of these jobs are in the biotech and medical industry, and the remaining are office positions (mostly tech offices).

2.0 Background

2.1 Location & Transportation Connections

The South Lake Union Streetcar serves the South Lake Union neighborhood of Seattle, with seven stops along 1.3 miles. Its route begins at the Westlake transit hub, and passes through the Belltown, South Lake Union and Cascade neighborhoods, ending at the Fred Hutchinson Cancer Research Center.

The South Lake Union Streetcar has connections with Link Light Rail at the Downtown Seattle Transit Tunnel Westlake Station, and with the Seattle Center Monorail at the Westlake Center station. Transfers are also available for riders to/from the RapidRide C Line buses at multiple stations. South Lake Union Streetcars run Monday-Thursday, 6am-9pm every fifteen minutes, and Friday-Saturday 6am-11pm. On Sundays, the streetcar runs 10 am-7 pm, every 15 minutes as well.

The Seattle-Tacoma International Airport is located 15 miles south of the center point (station at Westlake Avenue & Denny Way) of the South Lake Union Streetcar line. 

2.2 Community Character & Project Context

The entire South Lake Union neighborhood is about 340 acres. The region is also called the south-central business district of Seattle, as it is located between SR 99 and I5, south of Lake Union. The South Lake Union neighborhood consists of six sub areas: Cascade, Westlake, Denny Park, Dexter, Waterfront, and Fairview.

 In the early 1900s, the South Lake Union neighborhood housed migrant workers who built the Lake Washington Ship Canal. Back then, the area was mostly used for warehousing timber and coal arriving from across Lake Washington to be moved from Elliot Bay to California and other places along the west coast. After the Lake Washington Ship Canal was constructed in 1917, major auto dealerships and automobile-related services (such as Ford McKay) moved to the neighborhood, and many warehouses were left deserted.

Between 1998 and 2004, before the start of the South Lake Union Streetcar project, the region consisted mostly of abandoned warehouses and industrial utility buildings (most of them clustered close to Lake Union), low-scale residential buildings, and car-oriented commercial land use. During that time, small businesses and service-related jobs accounted for 41% of land use in the neighborhood while abandoned warehouses and industrial buildings covered the remaining 35% of the area.

The South Lake Union transportation plan, adopted in 2004, triggered the promotion of South Lake Union as a transit-oriented neighborhood. By 2006, biotech and software technology offices represented most of the South Lake Union neighborhood’s area (26%) while small businesses and warehouses covered 20% and 16% of the area. Following the construction of the South Lake Union Streetcar, the South Lake Union neighborhood transformed into a dense urban area. The promise of newly provided transit access to downtown Seattle attracted more biotech and tech-support companies as the neighborhood started taking off and the residential land uses increased from 3% to 7% between 1998 and 2006.

3.0 Project Description & Motives

The streetcar tracks on Westlake Avenue, where the current South Lake Union Streetcar primarily runs, were laid by the Seattle Electric Railway and Power Company in 1890. The last Electric Railways streetcar ran until 1941 when the rise of auto ownership and public bus services causing a decline in demand.  In 1998, the city of Seattle planned a comprehensive development strategy based on the growth management act adopted by the state of Washington, which identified areas with the most potential for development. At that time, the South Lake Union neighborhood was recognized for its small businesses and property ownership that dated back several generations.

As a result of the 1998 comprehensive development plan, the city of Seattle identified South Lake Union as one of the areas where growth should be concentrated. The neighborhood was largely known at the time for its rush hour traffic gridlock among abandoned warehouses and empty parking lots. The need for better transit options, coupled with an abundance of land ready for development, made this area of Seattle the most appealing. Rezoning policies to encourage mixed-use developments and density bonuses for affordable housing accompanied the neighborhood development plan.

The South Lake Union neighborhood transportation plan, adopted in 2004, envisioned the area as a transit-walk-bike oriented neighborhood, with diverse businesses that provided different types of employment. Acting as another driving force, Microsoft co-founder Paul Allen originally envisioned the restoration of rail service on Westlake Avenue to help improve the economy of the South Lake Union neighborhood, where Vulcan, Inc., his venture capital company, is heavily invested.  

However, the Seattle City Council did not support the project at the time, due to the lack of public support and the prioritization of Seattle's other transportation needs. After heavy lobbying by South Lake Union businesses, including Vulcan, the South Lake Union Streetcar project was approved in 2006; construction began later that year.

Another major motivation for the South Lake Union Streetcar project was traffic congestion mitigation, as the South Lake Union neighborhood was a major vehicular traffic generator; 2003 Census data reported approximately 14% of work trips use transit within the South Lake Union area. While this number was higher than the national percentage of transit mode usage in 2003 (4.7%), it trails far behind other major U.S. cities, such as Chicago (28% transit mode share) and Boston (35% transit mode share).  Limited transit access led many major employers in the neighborhood to implement Transportation Demand Management (TDM) programs, such as commute hour bus services and limiting parking spaces, thus helping to increase the transit mode share. However, because South Lake Union is a large neighborhood bus service does provide adequate coverage across the entire area.

4.0 Project Impacts

4.1 Transportation Impacts

4.2 Demographic, Economic & Land Use Impacts

In 2004, South Lake Union was designated as an urban center in Seattle’s Comprehensive Plan, to reflect the significantly increased expectations for housing and job growth. At that time, the area of South Lake Union included 1.6 million square feet of commercial space, 1,365 residential units, and 160 hotel rooms.  

One of the major companies to move into the area before the streetcar opened was Amazon.com. Vulcan, Inc., a real estate company, built Amazon’s 1.7 million square-foot headquarters and urban campus, as a step to gather all Amazon buildings previously scattered in different places in Seattle. Following the completion of the first phase of the Amazon campus construction, another million square-foot building was requested by the company to be built in the South Lake Union neighborhood.

Another major employer in the area was the University of Washington’s School of Medicine, which started to expand when the South Lake Union Streetcar project was halfway through construction. The University also developed a new Health Campus around that time. According to information obtained from interviews, both employers recognize the streetcar as a key driver for their development.

Between 2008 and 2013, following the South Lake Union Streetcar opening, commercial spaces increased to 4.8 million square feet and the number of residential units rose to 2,605.

Motivated by the investments of large employers such as Amazon.com, many other companies and businesses, such as biotech firms (PATH, NanoString Technologies Inc., Allen Institute), restaurants and retailer shops, and small businesses moved to the neighborhood. Five branch banks opened in the South Lake Union neighborhood after the streetcar started service.

In 2004, there were approximately 18,400 jobs in the South Lake Union neighborhood, resulting in a job density of 54 jobs per acre. Employment growth continued, adding over 23,000 jobs in 2012 and resulting in a job density of 67 jobs per acre.

Based on interviews with some of the major employers in the South Lake Union neighborhood, we estimate that about 10% of the total jobs created since the opening of the South Lake Union Streetcar were directly related to the newly provided transit access. It is estimated that 1,227 jobs were created as a direct result of the South Lake Union Streetcar project.

5.0 Non-Transportation Factors

The increase in population and economic growth in the South Lake Union neighborhood were the result of many contributing factors. The most important of these were supportive land use policies envisioned in the plan for the development of Seattle in the 1990s, the work of Vulcan, Inc. in attracting technology firms such as Amazon and Facebook to the neighborhood, and the improved accessibility created by the new streetcar. Many argue that the establishment of the Amazon.com headquarters by itself triggered the sudden appeal of the South Lake Union neighborhood to other technology firms and biotech companies.

In 2003, the city council approved policies that allowed for some deviations in building height, rooftop equipment, and parking to accommodate the particular needs of biotech institutions. In 2006, the rezoning policies were approved by the City Council of Seattle. The base height limits for developers that met affordable housing standards increased mainly in underdeveloped areas south of Denny Way. Affordable housing policies, together with new jobs created by large biotech employers, attracted a diverse population with different income levels to the neighborhood.

Real estate companies, especially Vulcan, Inc., worked alongside the encouraging policies in the new neighborhood plan for development. Paul Allen’s vision of the transit-oriented South Lake Union neighborhood was a major driver for the new business climate introduced into the neighborhood. Clise Properties, Inc. owned 12 acres of land in the neighborhood with nearly all of it bordered by Denny Way, Fifth Avenue, and Westlake Avenue.  Because Clise Properties at that time lacked strong financial backing to develop large properties now possible with the new high limits, they decided to sell their property holdings.  This decision enabled Vulcan and other property developers (that purchased this land) to accelerate development of high-rise buildings in the South Lake Union neighborhood, faster than would have been possible under Clise Properties management. 

6.0 Resources

6.1 Citations

1. George Howland, “Vulcan's Inside Track”; http://archive.seattleweekly.com/2006-01-18/news/vulcan-s-inside-track/
2. Ridership report archives; http://www.apta.com/resources/statistics/Pages/RidershipArchives.aspx
3. https://www.seattle.gov/Documents/Departments/OPCD/OngoingInitiatives/SouthLakeUnion/SouthLakeUnionUrbanCenterNeighborhoodPlan.pdf
4. Neil Modie, “Lake Union streetcar plan has council skeptics”; http://www.seattlepi.com/news/article/Lake-Union-streetcar-plan-has-council-skeptics-1106069.php
5. Adam Bejan Parast, September 2012; https://www.seattletransitblog.com/2012/09/21/amazon-to-buy-4th-streetcar-fund-10-minute-headways/
6. City of Seattle, 2011-2012 Proposed Budget; http://www.seattle.gov/financedepartment/documents/2011-2012PROPOSEDBUDGET.pdf
7. 2014 Center City Commuter Mode Split Survey Results; https://commuteseattle.com/wp-content/uploads/2015/02/14-5390-Commuter-Mode-Split-Survey-Report-2-23.pdf
8. City of Seattle, 2007, “URBAN CENTER NEIGHBORHOOD PLAN”; www.seattle.gov/DPD/Planning/South_Lake_Union
9. Public & Private Investments in SOUTH LAKE UNION, 2012; SLUpublicPrivateReportFinal-2012_0703_small.pdf
10. www.apta.com/resources/reportsandpublications/Documents/Economic-Impact-Public-Transportation-Investment-APTA.pdf
11. Young, Bob. “South Lake Union growth goes full throttle.” The Seattle Times Online. 11 December, 2007. July, 26 2012.

6.2 Interviews

Organization, Name, Affiliation

Parsons Corporation, Ethan Melone, Program Manager

Vulcan Inc., Lori Mason Curran, Investment Strategy Director

Seattle Department of Transportation, Michael James, Project Manager

Footnotes

Case Study Developed by University of Maryland