Last week, we looked at how cities have been the biggest catalysts of growth for countries. Today, I want to stress on transit-oriented development and why it’s important.

But before that, a quick request!

Get your contacts to sign up for the newsletter. I’ll give away 2 copies of my book, The Advisory Board to the first 2 people who get more than 5 people to sign up. Share now!

Share Zoom in, zoom out

Transit-oriented development (TOD)

Zooming out

TOD means developing cities with transit centres as focal points. The intent is to maximize the use of public transit and reduce reliance on personal vehicles.

A typical TOD has a railway station or a bus station at its centre, surrounded by relatively high-density development, which could include office complexes, malls, etc.

For TOD to succeed, sufficient density is required. For example, developing a rail network requires a critical mass of riders to be present. Without enough population, it is hard to build a railway system that is sustainable in the long term.

Studies suggest that TOD can help reduce driving by 85%, thus leading to better management of cities, fewer traffic jams and a potentially a lower carbon footprint.

Zooming in

Let’s take the case of Tokyo.

Tokyo is best known for its excellent public transit system. Look at this subway map -

Tokyo’s train system is designed to minimize car use. Taking a train is usually much faster than sitting in a car in traffic. The extensive route map helps too. Chances are — you would not have to walk for more than fifteen minutes after getting off from a train.

TOD in Tokyo is more than a type of development, it is a lifestyle. Owning a car is a choice; thus all persons of all levels of ability are able to meet their needs, for which TOD in Tokyo allows millions to meet in a manner that is sustainable and equitable.

Furthermore, because of this density, a lot of business is created. Japan’s six passenger railway companies are hugely profitable corporations. This is hugely because the real estate around train stations is owned by the railway company. They own it all — from the department stores to vending machines.

Why is this important?

TOD brings with itself immense opportunities for businesses, as is stated by the example of Tokyo. New retail stores, new food joints, new real estate spaces, etc. There are a lot of opportunities to create valuable businesses.

As cities like Mumbai move towards TOD, we should think of what valuable businesses can be created that do not exist today.

For example, what about a content creation business that is built around Mumbai’s transit? The opportunities are plenty!

I’d love your feedback about this article. Please fill out this survey. It will take less than 2 minutes.

Next week, I’ll write about smart cities and what they really mean.

Thanks for reading!

Hemant