Study: Building Inland Port Might Drive Industrial Property Value
The Urban Transportation Center at the University of Illinois at Chicago released a study this year that suggests the construction of an inland port may have driven industrial property value higher along its service area.
The April study looked at areas along high capacity trucking highways in Will County, Illinois, centered upon a development of an inland port or Intermodal Logistics Center (ILC) in Elwood, IL, a town south of Joliet.*
The report, “Intermodal Logistics Centers and Their Impact on Transportation Corridor Industrial Property Value,” was completed by researchers at the Urban Transportation Center (UTC) at the University of Illinois at Chicago.
Researchers used tax assessment, truck volume and U.S. census data from 2002 to 2007 to analyze patterns and property value changes of industrial property along trucking and waterway corridors close to CenterPoint, a master-planned inland port located on 6,500 acres 40 miles southwest of Chicago. Located in Elwood, CenterPoint was built between 2000 and 2002 with tax increment financing from the Village.
Those roadways studied as part of a treatment group showed an increase in equalized assessed value (EAV) per square foot by $0.25 over properties studied in a control group. The treatment group, located on the west side of Will County, was comprised of properties on or near Interstate 55, Interstate 80, State Route 53, and a waterway — the Des Plaines River/Chicago Sanitary Ship Canal. Properties studied in the control group, located on the eastern side of the county, were on or near Interstate 57, State Route 50 and U.S. Route 45.
The study, while finding a correlation between the construction of the ILC and the nearby bump in property values may not have uncovered a cause — the researchers note that it’s possible that speculation in industrial property in the time leading up to the ILC’s construction might be responsible. Additionally, in Illinois, studies of assessments means studying a number called EAV, or equalized assessed value, a multiplier that fluctuates values in an attempt to more tightly bind market value to tax levy calculation.
Also mentioned in the full study’s (available here) summary: the economic benefit of techniques of value capture – where special taxes or predetermined grants from developers are used to fund developments that are shown to produce economic benefit.
“In accordance with these findings, planners should consider value capture tools along trucking corridors,” the report stated. “Increases in industrial property value [should be] considered with projects that [involve intermodal logistics centers].”
* Fans of the 1980 film The Blues Brothers will no doubt recognize these town names as those of Joliet Jake and Elwood Blues.