Guest post by Joan Campbell

What are the economic benefits of bicycle infrastructure on retail sales and jobs? The links between bicycle infrastructure and economic returns, measured by retail sales and new jobs, is something that ULI research staff gets asked about frequently.

The issue is more and more relevant. According to the American Community Survey, between 1990 and 2012 the number of bicycle commuters jumped more than 50 percent, while the number of “bicycle friendly communities” shot up almost 150 percent. Furthermore, the 2009 National Household Travel Survey found that biking accounts for 1 percent of all modes of travel trips in the United States—a 25 percent rise since 2001.

Below are summaries of five reports that explore the topic. What do the studies show? Usually, findings report net positive benefits from bicycle investments, in terms of retail sales and jobs created. However, one study found slightly negative impacts.

Bikenomics: Measuring the Economic Impact of Bicycle Facilities on Neighborhood Business Districts was done by Kyle Rowe in 2013 for the University of Washington’s College of Built Environments. One of the projects Rowe studied involved the installation of a climbing lane, shared-lane markings, and the removal of 12 parking spots in the Seattle business district known as Tangletown.

After the project was completed, the sales index rose 350 and 400 percent in both the second and third quarters respectively. But, without looking at mode split data, Rowe stresses that he cannot conclusively attribute the gains to bicycling or automobile travel. But, one can conclude that there wasn’t a negative impact.

Rowe also points to a study which New York City recently commissioned. Retail sales were shown to have increased 49 percent after a protected bicycle lane was created on Eighth and Ninth avenues. See Measuring the Street: New Metrics for 21st-Century Streets.

Additionally, Rowe investigates the flaws in current methods used to measure the impact of bicycle infrastructure on neighborhood retail sales. He finds that while a lot of research evaluating the impact of bicycling facilities on national, state, regional, and citywide geographies has been done, there is a dearth of research on the neighborhood business district scale.

Perhaps the first study of its kind in North America, the 2011 Vancouver Separated Bike Lane Business Impact Study analyzed the direct effect that newly installed lanes had on businesses. Overseen by the Vancouver Economic Development Commission, surveys were conducted to gather data such as rents, sales, vacancy rates, and customer traffic for both separated-lane streets and “comparator” streets—those without separated lanes. Businesses reported a 5 percent dip in sales in 2011 over 2010 for all locations studied. Based on industry norms, the declines are considered “relatively moderate.” And, mitigation strategies were developed for “hot spots”—the areas where negative results were greater due to factors such as reduced parking, turning restrictions, and pedestrian access impediments.

A 2011 study, Pedestrian and Bicycle Infrastructure: A National Study of Employment Impacts, undertaken by the Political Economy Research (PER) center at the University of Massachusetts at Amherst, looks at the number of jobs created from the construction of “bicycle- and pedestrian-friendly facilities.” Data were evaluated for 58 projects in 11 cities. Total jobs—direct, indirect, and induced jobs—were estimated for every $1 million spent. The data showed 11.41 jobs for bicycle infrastructure and 9.91 jobs for pedestrian infrastructure on average per $1 million in investment. Results by project type are presented for each city analyzed.

Finally, Economic Impacts of Walking & Bicycling in Sonoma County, released in January 2013 by the Sonoma County Transportation Authority, captures information on how bicycling and pedestrian transit is undervalued, with the goal of bringing these modes into “broader conversations” when defining transportation.

Sonoma County is increasingly aware of the economic benefits realized from bicycling and pedestrian related events. For example, the Amgen Bicycling Tour of California contributed approximately $6.8 million to Santa Rosa’s local economy in 2012.  So it is no wonder that the 2011 Sonoma County Annual Tourism Report deemed bicycling as the leader in possible “niche markets.”

Do you know of other research or reports on the link between bicycle infrastructure and economic development? Let us know by commenting below.

This is a second in a series of ULI Research Round-Ups. The first Round-Up—The Impact of Transit on Property Values—looked at the economic impact of transit oriented development on nearby property values.  Next in this series, we will take a broader look at the economic returns from pedestrian amenities.