There are a number of fundamental misconceptions about parking management that serve only to cap the value attributed to parking assets. Here are the top five parking management myths that make the pros wince:
1. “People don’t care about how a parking lot looks. They just need somewhere to park their car!”
Reality: Your parking facility is, in most cases, the first touchpoint between your consumer and your organization. Its upkeep (or lack thereof) plays a pivotal role in crafting their first — and last — impression of your company’s ethos, priorities, and service offering.
Put yourself in your target consumer’s shoes; what would your first impression be of the organization that expects you to leave your vehicle — a valuable asset — in a dimly lit, poorly maintained, or understaffed parking facility?
2. “It doesn’t cost much to run a parking lot. It’s just some paint on asphalt!”
Reality: The average cost to build a 145,000 square foot, five-story parking garage in the U.S. is $8.56M. Even a simple surface lot costs an average of $24,000 per parking stall to build.
Further, each parking stall costs $500–800 per year, on average, to operate and maintain depending on the size and scope of services provided. This figure includes “hidden” expenses like insurance, repairs, lighting, snow removal, and so on. That’s why it’s essential that your parking lot is being considered and managed as a bankable stream of revenue.
3. “There’s no point in investing in our parking facility — the revenue stream is too weak!”
Reality: There are around 40,000 parking garages and lots in the U.S., which are projected to produce over $28 billion in revenue this year. Further, demand for parking is predicted to steadily increase long term thanks to significant population growth, low unemployment rates, and higher individual economic stability. We’d call that a pretty secure investment!
If your parking revenue stream has yet to evolve beyond a trickle, it may be time to consider outsourcing your parking management to an experienced provider like Impark.
4. “Why would we outsource? Partnering with a parking company would eat up our revenues!”
Reality: An industry-leading parking management company like Impark has two goals — to increase the revenues that you take to the bank, and to increase your consumers’ satisfaction with your parking service. We can only realize our expenses and profits by achieving both of these objectives.
Recent examples of parking facilities that have transitioned to Impark management show cost savings of 17% or higher in light of greater operational efficiencies and economies of scale. These facilities also see double-digit top-line revenue growth (without increasing parking rates) arising from facility yield optimization and improved cash controls.
5. “Parking lots can’t promote sustainability. That’s a contradiction!”
The careful design and management of parking facilities is an essential component of any company or municipality’s sustainability program. A well-managed parking lot can reduce congestion in the immediate area by improving traffic flow and reducing the number of drivers cruising for a parking spot. Cruisers, according to research by Donald Shoup, a professor of urban planning at the University of California, account for 30% of traffic.
Parking facilities can also help to reduce an organization’s carbon footprint — helping them to achieve LEED status if desired — by integrating rooftop solar panels, LED retrofits, and other energy efficiencies into their management strategy. Further, a proactive parking manager can implement social sustainability initiatives, such as incentivized employee car sharing, transit commutes, and bike-to-work schemes, and leverage their memberships with sustainability councils to provide you with a greater breadth of green resources.
Impark, for example, was a founding member of the Green Parking Council, a non-profit organization that provided leadership and oversight for the conversion and renovation of parking facilities to sustainable, environmentally sound assets. Today, Impark continues its work as a sustainability leader through membership in the U.S. Green Building Council, the Green Parking Council’s acquirer.
Have you fallen prey to a false assumption about your facility’s management? Becoming familiar with the realities of parking is a key element to understanding your parking asset’s worth. However, realizing and growing that worth in a responsible, sustainable, and consumer-friendly fashion is no easy feat and may be best left to the industry experts.
Impark is one of North America’s most experienced and successful parking management companies. As a progressive leader in an evolving industry, we offer complete parking and transportation solutions designed to exceed the ever-changing needs of a wide variety of clients.
Learn how we can help you maximize your parking revenue. Get in touch here.