Abstract:
Transportation-based infrastructure development has become a crucial element in urban
milieu. In developing nations, financing transportation infrastructure development has been
under pressure due to high cost of compensation, construction and maintenance. However,
efforts to improve transportation facilities often focus on ill-suited sources of financing,
often involving massive debt, with limited attention to the potential contribution of
alternative financial models in financing infrastructure development. This paper seeks to
bridge this gap by tracing linkages between financing, transportation and land use systems
and how these connections can inform policy development. This will assist governments to
achieve positive outcomes for financing transportation infrastructure development in
particular projects. This study is bult around the theory of land-based value capture in order
to explore whether there is any alternative opportunities for infrastructure financing in Sri
Lankan cities. By applying this theory, a four-step framework was introduced and validated
through the case of Kottawa – Makubura Multi Model Transport Centre Development
(MMC) and highway development projects. This framework mainly considered the existing
regulatory framework to identify suitable alternative financing opportunities. In addition, it
conducted an infrastructure beneficiary analysis to identify beneficiary groups in new
developments. As the next stage it analysed the property value impacts through the hedonic
pricing method. Findings indicated significant value increments (of around 20%) taking
place within a 500m radius of new transportation developments, with lower impacts at
distances of 1km and 2km from a given development. It verified that locational factors are
the most influential factors in increasing residential property values pursuant to
development of new infrastructure. Finally, it was proposed to adopt an active funding
policy. The framework was validated by selected practitioners in the field. Accordingly, the
conceptual framework developed will accommodate future studies related to land-based
value capture.
