Smart parking

Parking is big business in the United States. Of the approximately 2 billion parking spaces that dot the American landscape, about 10% is paid parking.

These parking garages and lots come in all shapes and sizes. Some are attached to commercial or residential properties. Some are free-standing public garages. Some have valet or attendants at the gate, while others are unstaffed.

But regardless of configuration, all this parking requires some type of management, and each parking style brings demands different from other asset classes.

Moving parts

The clearest difference between garages and other properties is that parking spaces cater specifically to vehicles. Because of all this moving machinery, garage managers must keep their spaces clean and safe for their clientele.

Lynne Miller, CPM^®, RPA^®, LEED^® AP O+M, Charles Dunn Real Estate Services, Inc., AMO^®

“Safety is a huge consideration for garage managers because there is more liability,” says Lynne Miller, CPM^®, RPA^®, LEED^® AP O+M, senior vice president at Charles Dunn Real Estate Services, Inc., AMO^®. “You have to think about speed. People will speed no matter how many places you post a speed limit sign.”

Yet the list of potential problems doesn’t stop there. “Another consideration is electric vehicles (EV), which are so quiet that you might not hear them coming,” Miller says. ”And for garages with a restaurant attached, alcohol creates another liability.” Managers must also look out for unauthorized vehicles, according to Maurice D. Williams, vice president of operations for OnCall Patrol LLC, a parking management company that services multifamily and HOA communities. These vehicles could have expired parking tags or pose a risk for abandonment.

Maurice D. Williams, OnCall Patrol LLC

“When we have unauthorized vehicles that take up the space reserved for those who are authorized to park there, our job is to monitor this and get it cleaned up,” Williams says, adding that managers may also have to deal with upset vehicle owners when a car is towed.

And if your lot has many visitors, there will likely be more spills and trash, requiring more cleaning by sweeping or pressure washing. But for garages with the same users every day, such as those attached to an office or residential property, there may be less cleaning and maintenance.

“You know these tenants, they know the rules, and they are going to take better care of the lot,” says Miller, who oversees various commercial properties with parking in Los Angeles.

Erik Hedegaard, CPM^®, associate director at Avison Young

Erik Hedegaard, CPM^®, associate director at Avison Young, adds that the challenges are in the details, such as specialized equipment and mechanisms for cash control. In addition, managers must become familiar with EV charging stations, striping protocols, ADA compliance codes, parking stall sizes, and signage on speed, towing, pricing, and hours, among other considerations. 

The question of operators

Because of all these concerns, some property managers may opt to hire a parking operator to deal with the day-to-day procedures of the lot or garage. 

“Hiring a qualified operator to manage a garage can be a benefit,” Miller says. “They know exactly what types of signage need to be posted, such as the hours of operations or parking rates.”

For managers who opt to work with an operator, Miller recommends monitoring their activity and maintaining communication.

“Be sure to meet with them regularly and keep an eye on the financials,” Miller says. “Review monthly reports to ensure you receive your parking revenue funds and that the operator is not using more expenditures than needed.”

Managers also must be prepared for parking operators to oversell parking spaces, knowing that every space isn’t going to be used every day. “If you sell more spaces than you have, it can be challenging without parking attendants onsite,” Miller says. If there’s valet parking or attendants, they can manage the overflow with aisle or tandem parking.

Other managers prefer to oversee the garage operations themselves. “If you do it yourself, I have found that you have more control and can improve your revenue stream,” says Hedegaard, who oversees suburban Class A office properties with attached garages and surface parking. “Nobody invests more time and effort than you when managing a building or a garage.”

Tech at work

Unsurprisingly, Proptech is changing how users and operators interact with garages and lots. With this technology, property managers or garage operators can let apps or cameras do the heavy lifting.

Apps like SpotHero allow drivers to reserve and pay for spaces before they arrive. “There are also apps that let you tell the valet that you’re going to be ready in five minutes, and then your car is waiting for you,” says Miller. 

Another advancement is license plate recognition technology, which offers contactless access to registered parkers. When a vehicle pulls up, the license plate is scanned, and the vehicle can enter the garage. A ticket number is then created based on the license plate, starting the session. When the vehicle leaves, the proper fee is charged. Other parking structures are equipped with hang tag technology, utilizing a long-range reader to scan a registered hang tag on a car, triggering the opening of a gate system, Miller says.

Optimizing revenue

Many of these Proptech advances can help accurately calculate and enhance revenue. But to further maximize income, Hedegaard, Miller, and Williams share these tips:

• Offer special pricing, such as early bird or flat rates.
• Build parking fees into commercial leases. These arrangements typically allocate a certain number of spaces per thousand square feet of rented space.
• Implement a paid guest parking system to generate more revenue for the property owner.
• Use a shared parking approach. If your lot is empty during a specific period, allow another business or organization to “rent” those spots during the quiet period. Valet or attendants can help park cars if there’s ever overflow.
• Stay on top of market trends and what your competitors are doing. “Market research is imperative to optimize revenue,” Hedegaard says.

Keys to success

Managing a parking garage can bring in many opportunities, like higher tenant attraction and retention, especially when managers prioritize safety and cleanliness, Miller says.

Along with managing the unique safety and sanitation concerns, Hedegaard says it’s the same attention to detail and consistency in procedures that make a successful parking manager.

“I see managing a garage as having more customers, as each parker is like a tenant,” he says. “It may be a bit more intensive, but it’s not very different.”