Unlocking housing and growth: the case for Station Investment Zones

Robert Cook, Policy Director | Railway Industry Association

4 min read15 October 2025 Partner content

Regeneration, housing and economic growth are all high on the government's agenda, but with constrained public finances, new ways to attract private investment are needed. Robert Cook of the Railway Industry Association sets out a new model to unlock private investment through the creation of dedicated Station Investment Zones.

Railway stations sit at the heart of communities across the UK. More than 85 per cent of the population live within 5 kilometres of a station¹, yet too many of these vital assets and the areas surrounding them are underused and under-invested. There is a £2bn backlog of maintenance at railway stations.

Public finances are constrained, and the UK needs to find new ways to leverage private investment to increase housing supply, boost growth, and support skilled local jobs. With over 2,000 small and medium-sized stations situated at the heart of communities across the country, a new approach to investment could unlock the potential of stations as engines of community growth.

The Prime Minister himself has acknowledged the important link between housing and stations.² Independent research has shown that at least 1.2 million homes could be built within a 10-minute walk of railway stations.³ Homes within 500m of stations are already valued between five and nine percent higher than those 1.5km away,⁴ reflecting the value of good transport links.

Harnessing the relationship between housing, transport and commercial activity is key to turning stations into generators of local growth. The transformation of the King’s Cross St Pancras area in London clearly demonstrates what can be achieved, whilst the new Northumberland Line and Borders Railway have gone hand in hand with housing development. The independent appraisal of the King’s Cross redevelopment, published by the Government last year, shows it has tripled local employment and quadrupled economic output.⁵ The challenge now is to replicate that success - not just in flagship city hubs, but across hundreds of smaller and medium-sized stations that serve towns and suburbs across the country.

A cross-industry group, convened by the Railway Industry Association (RIA), has developed a proposal, Station Investment Zones: A new model for investment in transport, housing and growth, being launched in Parliament on 21 October, which sets out a practical approach, including:

The creation of new Station Investment Zones, which adapt the existing Investment Zone model to cover roughly an 800-metre radius (about a ten-minute walk) around stations. Within these zones, planning and tax incentives would be aligned to support new housing, commercial development and improved transport.
An innovative investment model, where the private and public sectors can co-invest in a wide range of local improvements, such as integrated transport hubs and increased amenities for the community. This would draw on the Mutual Investment Model already used in Wales where the public sector can take a share in any proceeds.
A scalable approach that works across the UK to bring together groups of stations as a portfolio, to establish the economies of scale that will help attract private investment and help reduce costs.

The aims are straightforward, but transformative: to build homes, create jobs, regenerate local economies and improve accessibility. Crucially, these zones would bring together devolved and local authorities, the railway and private investors in a single coordinated framework to ensure that development decisions are made locally, but with national backing and investment confidence.

The investment model would bring together different funding streams for maximum impact: existing public grants ranging across national and local government and spanning transport, housing and energy; passenger revenues; commercial income; and land value capture from new developments. Bringing together these revenues through a single investment model will allow local investment in transport hubs that support their communities.

The proposal has been developed drawing on analysis of an illustrative portfolio of stations on the North Kent coast, which showed that well-targeted upgrades could repay investment within three to eight years.⁶ The research, carried out by Steer, identified that over one hundred stations across the UK could be immediately suitable for investment as inclusive intermodal transport hubs.

Historically, investment decisions at stations have been piecemeal and fragmented. A small-scale approach is never going to deliver the step change in transport, housing and growth that the UK needs. By establishing a clear national framework and inviting local areas to participate, a much more ambitious approach is possible. With planning reforms, an infrastructure strategy, the creation of Great British Railways, and the increasing remit and capabilities of Mayoral Combined Authorities all pointing in the right direction, the time is now.

Station Investment Zones: A new model for investment in transport, housing and growth will be launched at a roundtable in Parliament on 21 October. For details, contact Senior Policy Executive Dominic Poole at [email protected].