Cube Land integration between land use and transportation T. Vorraa Director of International Operations, Citilabs Ltd., London, United Kingdom Abstract Cube Land is a member of the Cube transportation planning system. It offers an integration of land use and transportation planning in a software package which is market standard around the world. Cube Land is based on an economic evaluation of the real estate market where it is assumed that residents and economic activities are located where they represent the highest bidders for the land under the given conditions for the transport system, the economy, demographic growth as well as governmental regulations, subsidies and taxes. 1 General overview of the Cube planning system Freight Passenger Cube Cargo Cube Voyager product ArcGIS target Cube placearcgis ArcGISprice market Base Cube Cube Land Dynasim ArcGIS Land Use Microsimulation promotion Cube Polar Air Quality Figure 1: Cube modules. Cube is a transportation planning software system designed for forecasting of passengers and freight movements. Cube offers advanced and flexible tools for the generation, distribution, mode split and assignment of personal and freight transport as well as detailed analysis of environmental issues. The latest module added to the planning system is Cube Land, making an integrated land use and transportation planning achievable and supported by an efficient, user friendly and market standard software package.
112 Urban Transport X 2 Overview of Cube Land Cube Land uses a mathematical model for forecasting and simulating of the real estate market under different economic conditions. For a user defined scenario, Cube Land forecasts the supply and the demand of different types of urban, residential and non residential real estate properties. Furthermore it finds the location of households and non residential activities of the study area. Consequently, it gives detailed information of the main variables that characterize the Real Estate Market. Cube Land simulates changes to the real estate market based on economic evaluation of the impacts of: Demographic and economic growth Application of urban management policies Real estate or transport projects and Changes to consumer behaviour The model finds an economic equilibrium between land supply and demand under different macroeconomic conditions and regulations using a rigorous microeconomic approach. People s perceptions of the real estate market, market restrictions and regulations as well as various external influences are considered. 3 Interaction with the transport system Cube offers an integration between the economic principles that characterize the supply and demand of real estate and the influence that accessibility has on land use. Also, the system has been designed to match the typical aggregation levels that a strategic transport model represents. The consumers in the real estate market consider the accessibility as one of the attributes in their location choice, which is the base for the calculation of land prices. Cube Land provides a range of graphical and numerical indicators for analysing land use effects on transportation and vice versa. 4 Cube Land concepts Cube Land is based on economic theory with a property/land bid function for each consumer. The bid function estimates the value of real estate property in the market and defines the location pattern of activities and the levels for rents in the study area. Variables that influence land use are discussed on the following pages. Consumers' behaviour An assumption in Cube Land is that all consumers in the real estate market, either households or economic activities, are located where they are the highest bidders for this particular land. Real estate is assigned as if it was an auction
Urban Transport X 113 where unique goods are traded. This approach determines that the rent of each real estate corresponds to the highest bid based on a function defining the demand for this land. Unlike other economic markets, the bid function determines the price of the goods, i.e. the land. The bid function, defined as the inverse of the utility function for rents, represents the consumer's preferences and perceptions of the attributes of a real estate, subject to budget restrictions. The bid function, its form and variables, may be defined by the user. Cube Land uses linear and nonlinear structures for bid functions and several variables that represent the characteristics of the consumer, real estate and neighbourhood. Some socioeconomic attributes are included to consider the life cycles of households, as well as building characteristics and zone quality indices. Examples of such indices are accessibility to the transport system, their environmental quality and location. Location Cube Land allows the explicit analysis of location choice based on the interaction between activities in their location. This interaction is represented by (endogenous) location attributes in the bid function. For residential locations, examples of such attributes are the socioeconomic status of the neighbourhood and the existence of annoying activities in the area such as heavy industry. Examples of attributes that influence location choice for economic activity, are the demand for its products or services in the area, the accessibility and the location of competing companies. Local supply trends Cube Land's real estate supply model is based on the analysis of the historical tendency of the supply, the variety of supply and rent values of the real estate in the study area. Consequently, for each forecast year the model will forecast the distribution of the supply by zone and type of activity. Urban management policies; Regulations, subsidies and taxes Cube Land simulates how regulations and restrictions influence the development of the real estate market. This may be banned types of activities or the concentration of certain types of activities. Land use policies may also use subsidies and taxes to influence land use demand and location. These government tools may be used to influence both the physical supply of land and its location. For a study area, the user can input different sets of parameters that represent the main norms of regulation. All these regulations may vary by zone and also by type of consumer. The most important are: Maximum area of land available for development Minimum property sizes Maximum land utilization (per plot and per area) Maximum building height Type of land use
114 Urban Transport X Limits for residential density and population (min and max) Other tools for the local government are location subsidies and tax policies. Such interventions in the market may increase or decrease the consumer's bid, which may produce a change in the location choice. There is a wide range of subsidies or taxes that the user can define for different socioeconomic clusters, real estate building type and area. Economic equilibrium Cube Land finds a feasible state of equilibrium between supply and demand in the real state market with all consumers located. This state represents the economic tendency of the real estate market forces. Any change to one or several of the exogenous variables in a given future scenario will cause the supply and the real estate demand to adjust in such a way that a new market equilibrium is reached. Cube Land recognizes that there is a set of restrictions that act on the real estate supply and demand functions and that these may prevent, in extremes cases, the equilibrium state being reached. Such restrictions can be included in the model: a) Restriction on the real estate supply Along with the obvious condition of non-negative supply, Cube Land allows the inclusion of other restrictions on the supply that represent: A model of behaviour of the real estate supply Regulations that limit the land use and location of specific activities Specific real estate projects b) Restriction about the location of activities Also, it is possible to simulate regulations that restrict the location of certain consumers (residents or economic activities) in certain types of real estate and zones of the study area. Economic and demographic growth Cube Land is sensitive to the growth or decrease of economic activity and to demographic growth and change in the socioeconomic structure of the population. Planned transport projects The microeconomic framework of Cube Land establishes a consistent relation between transport and land use. Cube land considers changes to the transport system and this may induce changes in accessibility which is an important attribute in the location bid function. In this way, a transport project can affect the location of activities and the level of real estate rents.
Urban Transport X 115 Planned real estate projects The disaggregated structure of Cube land makes it possible to represent the influence that a specific real estate project of importance may have on the real estate market. 5 Key input data Cube Land uses a set of local and general parameters to describe the land use. The main local parameters describing land use are: a) Real estate supply by zone % of occupied real state according to type Occupied land and construction areas according to type b) Location by zone Nr of consumers, by socioeconomic categories, located at each types of real estate Land and construction areas occupied by each category of consumer in the different types of real estate Average income for residents c) Real estate rents by zone Real estate rents according to type The information about real estate supply, location and prices is used to: Analyze trip generation/attraction Study the environmental issues in the study area; e.g. land effected by contamination Evaluate economic benefits of land use changes Define the optimal locations of activities as to maximize profit or social benefit d) Transport costs by zone Transport time between origins and destinations in the study area Transport distance between origins and destinations in the study area Transport costs between origins and destinations in the study area General parameters that influence land use are: e) Economic and demographic growth
116 Urban Transport X f) Land use policies and regulations Land restrictions and availability Property size restrictions Building utilization rates Land use type restrictions The input is organized in land use scenarios representing combinations of these key input variables. 6 Application of Cube Land When applying Cube Land, the user defines a scenario, runs the model to forecast the state of the real estate market for the scenario and analyses the results. These tasks are supported by a flexible and intuitive, map based user interface. Figure 2: The Cube interface. The application not only allows the modeller to forecast changes to the real estate market, but also to analyze the large amount and variety of spatially specific information that characterizes the market.
Urban Transport X 117 Building scenarios A scenario of the real estate market corresponds to a set of parameters and conditions that the user can set and modify in order to perform a land use forecast. The Cube software has a built in scenario, data and parameter management system that is common to the land use module and the transport planning module. The base set of data and parameters for a scenario are input in the scenario manager s data panel. Some scenario specific variables can be defined and modified interactively making it easy to: modify the total amount of consumers (homes and economic activities) make changes to regulations that affect supply and location of activities introduce or modify subsidies and tax policies Running the Land Use model The scenarios are linked with the transport/land use application in a flow charting system. The flow chart defines the model structure and a task monitor reports the model run as it progresses. The model finds the solution that defines the state of market equilibrium considering the conditions set by the user for a given scenario. The system solves a large and complex problem of non-linear constrained optimization using a sequence of iterative algorithms. Exploring results The Cube interfaces allow modellers to generate graphical representations and statistical indicators for a great number of variables. The user can analyze the scenario input data, the forecast results and compare these against other planning scenarios. Cube includes its own map based graphical interface and also provides a seamless link to ESRI ArcGIS, the world leading geographical information system (GIS). References Francisco Martínez and Pedro Donoso (2001) MUSSA: a land use equilibrium model with location externalities, planning regulations and pricing policies. 7th International Conference on Computers in Urban Planning and Urban Management (CUPUM 2001), Hawaii, July 18-21, 2001.