Every metre of pedestrian street shows in the property price

Plans for a new pedestrian street usually start a debate. Shop owners worry about customers who arrive by car, and planners point to people on foot who stay longer and spend more. New Swedish research adds figures to that discussion: what pedestrian streets are worth to the property around them, measured with data from the whole country.

A national study from HFI

The study is by Oana Mihaescu, research director at the Institute of Retail Economics (HFI) in Stockholm, and was published in Town Planning Review in 2026. Mihaescu has also led a research project at HFI on how pedestrian streets affect the business mix, business growth and the attractiveness of the surrounding area, funded by the Hakon Swenson Foundation.

The article notes that the effect of pedestrianisation on property values has been under-researched. To estimate it, Mihaescu combined three countrywide Swedish databases and compared property prices in areas where pedestrian streets were extended or shortened with a control group, before and after the change. The design captures the effect in both directions, for commercial property as well as for housing.

What the study found

• Each additional 10 metres of pedestrian street raised the price of commercial property within 500 metres by 9.75%, about SEK 980 per square metre.
• Housing within the same distance rose by 2.77%, about SEK 869 per square metre.
• Each 10 metres removed lowered prices by 8.16% for commercial property and by 2.88% for housing.
• The effects weaken with distance from the pedestrian street.

The article also sets out why: pedestrianised areas attract consumers, businesses want to be where the consumers are, and demand for both commercial space and housing rises. In percentage terms, the effect is largest for commercial property.

For a municipality, this means that a decision to extend or shorten a pedestrian street also affects the value of the property around it. For property owners in a city centre, the study gives a figure to bring into discussions about how the street is used and developed.

Madrid: the businesses’ view

A study from Madrid, published in European Transport Research Review on 28 September 2026, looks at the same kind of change from street level. Researchers at the Universidad Politécnica de Madrid interviewed businesses in two areas that were pedestrianised on a large scale, Puerta del Sol and Plaza de Olavide: shops, bars, restaurants, hotels and service businesses such as hairdressers. The first round took place in 2023, shortly after the change, and the second two years later.

• In 2023, 16% of the businesses said their sales had increased. In 2025 the share was 57%.
• Over the same period, the businesses gave less weight to customers finding it harder to arrive by car.
• Asked what influenced their sales, the businesses in 2025 gave the highest rating to more pedestrians on the street.

Satisfaction with the pedestrianisation was high right after the change and higher two years later. With around fifty businesses interviewed in each round, the Madrid study complements the Swedish one: one shows the effect on property values across a whole country, the other how the businesses on the street experienced the change.

Next step: following the flows over time

Both studies point to the same thing: pedestrian streets draw people. The Swedish study builds its explanation on it, and the businesses in Madrid rated more pedestrians as the factor that mattered most for their sales. For a municipality or a property owner who wants to build on these results locally, measuring footfall can be a natural next step.

With a baseline from before a change and continuous measurement afterwards, it becomes possible to follow how a pedestrian street develops: which stretches draw the most visitors, how the flows vary over the week and the seasons, and where the visitors come from. For cities and municipalities, that is a way to follow up a pedestrianisation year by year, much like when you measure the impact of events and campaigns. For property companies, the same data can support lease negotiations. When Västerås measured its city centre, it found that the busiest street was not the one people had assumed, and the finding changed window displays, entrances, property values and rent levels.

Measurement in public space has to protect the people being measured. Bumbee Labs measures anonymously and reports statistics about places, never about people, using the only footfall method in Europe approved by a data protection authority. More on how this works in GDPR and traffic measurement in public space, and on measurement in city centres in visitor analytics for city centres.

Sources

• Mihaescu, O. (2026). Reconquering the city: A difference-in-differences estimation of the effect of pedestrianisation on the attractiveness of urban areas. Town Planning Review, 97(5), 481–506. https://doi.org/10.3828/tpr.2025.52
• Brownrigg-Gleeson, M. L., Monzon, A., Lopez-Carreiro, I., & Al Suleiman, S. (2026). Shaping business satisfaction with pedestrianisation: Evidence from Madrid (Spain). European Transport Research Review, 18, article 87. https://doi.org/10.1186/s12544-026-00846-w
• HFI, Institute of Retail Economics. Vilken effekt har gågator på företagsmix, tillväxt och områdets attraktivitet? Research project 2021–2023, led by Oana Mihaescu, funded by the Hakon Swenson Foundation. https://hfi.se/omraden/who-will-walk-500-miles-effects-of-pedestrianization-for-retailing-and-hospitality-firms/