Three Trends in Parking Management

Dan McCombie is a Research Associate at Larisa Ortiz Associates

I’ve noticed a couple of trends of late in regards to parking and how downtowns are trying to effectively manage the demand for it. It feels important to understand these trends because they all have implications for how customers access downtowns, as well as the toolbox of strategies and tactics we have as district managers. In any event, I would be curious to know if what I’ve observed tracks with what others have also seen. Here goes…

1.       Parking decks (as we know them) are experiencing incremental extinction

There was a Crain’s NY article recently talking about the challenges being faced by Manhattan parking garages. Operators say they’ve felt a lost demand over the past 18 months, citing a 10% drop in the number of “transient units” (cars that park by the day or hour). They attribute this trend to growing patronage of car-share (Car2Go) and ride-share (Lyft and Uber), but made all the worse by rising labor costs and recent rumblings by politicos about possible congestion pricing in Manhattan. Yet this is not unique to New York. Waning demand for structured parking is also being felt in cities like Chicago, Philadelphia, and Boston where competition from alternative transit choices and concerns over congestion are just as prevalent.

Uber has been unapologetic, responding that it’s all for the better those garages disappear if that creates more space for affordable housing and public parks. Sounds rosy, and there is some sense to it since affordable housing--typically exempt from parking minimum--presents a real option for infill development. But we’re also seeing cities like Philadelphia incrementally knock down their garages and replace them with luxury housing. In other cases, owners are getting creative and turning their underutilized parking structures into trendy food hall retrofits.

To be clear, parking structures are still being built, but increasingly with an eye towards a ten to fifteen year horizon where the use of that deck will likely be fundamentally different based on declines in car ownership and increases in autonomous vehicle use. That means designing for easier retrofitting to retail or other non-residential uses, usually by adding a few feet to ceiling heights. Or it means curbing costs and capitalizing on economies of scale by going fully automated with garages that don’t require human labor and can store more cars in a smaller footprint.

Regardless, in more and more places we’re seeing garages adapt based on the anticipation (or realization) of reduced demand.

Automated garage designed by BRN Architects in Izmir, Turkey
Photo: Inhabitat

2.       On-street parking is off-brand

The literature is rich in urbanist corners about the benefits of turning traffic lanes and on-street parking into bike lanes and larger sidewalks. A really good example of this is the NYC DOT’s report, The Economic Benefits of Sustainable Streets, commissioned during Janette Sadik-Khan’s time at the helm of the agency. The report is notable because it seeks to draw the connection between complete streets and economic development, and does so employing an objective methodological approach where local business sales were monitored before and after street renovations. Their change in sales was controlled against sales figures for other comparable commercial corridors within the same neighborhood. After conducting this research, the study conclusively found that complete streets provided benefits to businesses in all types of neighborhoods, “from the central business district to modest retail strips in residential areas.”

I bring this up because more and more people are recognizing the spending power of pedestrians while the notion of creating more space for cars feels counterintuitive and antiquated. So while we see reports and case studies that supports removing on-street parking to bring in a protected bike lane, the literature becomes much more scant on whether or not it makes sense to turn a traffic lane into on-street parking. I draw attention to this because complete streets means supporting as many competing uses as possible, but many streets simply don't have the capacity to do that. If you must choose, what is the argument for parking instead of bike lanes (if there is one)? Yes--I’m familiar with the oft-quoted fact that every on-street parking space is responsible for some $200-$300K in revenue for nearby businesses. I’ve seen this number quoted ad nauseam and out of its original context. That is not to say it’s wrong, but it glosses over many of the variables that are responsible for generating that value.

On-street parking can play a valuable role for commercial districts that goes well beyond providing direct storefront access for shoppers. Good flexible on-street parking can also provide commercial loading areas for vendors or serve as designated pick-up and drop-off points for ride-share services in an effort to ease congestion. It can also have a “teaser” effect in that it suggests to shoppers there is easy and available parking (thereby inducing more shopping trips), but actually increase the utilization of garages and decks as a substitute when curbside spots are at capacity. And at the end of the day, it also can calm traffic and reduce crossing distances which also serves the pedestrian environment. In short, flexible curbside parking has its benefits which may or may not make sense depending on the district.

Ninth Avenue street improvement project
Image: Economic Benefits of Sustainable Streets; NYC DOT

3.       “Smart Parking” is smarter thank you might think

A common refrain in many districts is that there is simply not enough parking to suit retail. And this assertion comes from all corners; not just customers but also property owners and merchants. But with the growth in alternative transit choices and with Millennials owning fewer cars, more often than not we’ve found it’s an issue with parking management and not supply. How do we address situations where one lot is at capacity while other lots are underutilized? There are several solutions, but I'm increasingly drawn to the growing number of apps that seek to address the parking management question. Here are a few examples:

·         ParkMobile – Perhaps one of the more ubiquitous options in the market right now, it provides seamless parking payments through an app, with the advantage of allowing the user to feed the meter remotely when their time runs out. The company also provides a Parkmobile.io website as a way to make reservations with parking garages and ensure a spot is waiting for you when you arrive at your destination.

·         ParkWhiz – Similarly allows users to reserve and pay for spaces seamlessly and allows parking operators to adjust prices and offer deals based on real-time demand data.

·         ParkBee – This UK/Netherlands based company created a partnership with ParkMobile that allows owners of private lots to advertise their spaces to the public (think Airbnb for parking).

The value proposition for many of these apps is not just based on convenience, but also an ability to offer competitive pricing. And they’re being embraced through ever more channels with some car manufacturers incorporating them into the on-board computers (e.g. BMW 2018 models use ParkMobile) and navigation services like WAZE thinking about how they can complement their existing platform.

And apps are only half of the picture. A growing number of parking data collection companies like Streetline and parking management platforms like NuPark are working in coordination with these apps to make getting from point A to point B as seamless and efficient as possible through tech that allows remote gate activation and license plate recognition.

One of several parking management services offered by NuPark
Source: NuPark.com

What do these trends mean for district managers?

Does your district still need a large supply of parking decks? Should it substitute curbside parking for a protected bike lane? If there is a strain on parking, is it based on management or supply? Different districts have different needs and there is no one size fits all strategy here.

As Kimley Horn stated in a report for their White Paper Series, parking guidelines developed by the Institute for Transportation Engineers and Urban Land Institute are “routinely applied in areas they should not be”, meaning that standards for standalone shopping centers are being used for downtown Main Streets. For that reason, any parking intervention should really be predicated on an accurate picture of existing conditions and we have a growing number of tools at our disposal to do that and to bring that picture into sharper relief. 

As mentioned, I’m wildly curious to know if others agree with these trends or have observed others that are as impactful.

Source Cited:

Parking Generation – Replacing Flawed Standards with the Custom Realities of Park+; Kimley Horn; May 2016

Commercial Revitalization by the Pint

Across the country small to mid-size cities (and their downtowns) are making a comeback. As reported in one of our previous posts on downtown trends, an increasing number of young and older population groups are moving to small and mid-tier cities attracted by their real estate affordability and quality of life. In many places, this renaissance is connected to a phenomenon that has attracted the attention of planners, economic development experts and commercial district practitioners: the surge and growth of craft breweries.

On a recent trip to Waterbury, Vermont, I witnessed this resurgence first hand, and currently in a number of projects that we’re working on across NY State, we have observed the same. A look at the the latest statistic published by the Brewers Association is telling: the number of U.S. breweries is at a 128 year high with over 4,200 craft breweries across the US and 549 new breweries opening between 2014 and 2015.

Beer drinkers are not the only ones enjoying this growth; craft breweries have caught the eyes of local officials and economic developers and they are encouraging the development, growth, and attraction of these companies. Over the past couple of years a number of cities launched attraction campaigns to land the east-coast expansions of some of the largest western craft brewers.For example, Roanoke’s bid to lure Chico, CA based Sierra Nevada included calls from senior political figures, $13 million in incentives, and vials of local water.  Philadelphia marketed the city’s thriving craft beer scene in their campaign for Fort Collins, CO based New Belgium Brewery (maker of the popular Fat Tire Amber Ale) while dangling millions in tax incentives. Both companies, along with Lyons, CO based Oskar Blues, chose brewing hotspot Asheville, NC (and its surrounding region) as their second home, adding to the city’s growing craft beer cluster.

Asheville, North Carolina, is a small city that fights way above its weight class in the craft brewing world, with several Beer City USA titles under its belt. Asheville has numerous home-grown breweries, but it has been able to lure expanding West Coast breweries more than any other city in recent years. New Belgium, one of its recent attractions has recently opened their new facility in Asheville’s River Arts District, which will become a centerpiece of the redevelopment efforts connecting the city’s CBD to the French Broad River. In fact, Asheville has been so successful as a craft brewing center, that it did not win the most recent brewery expansion project–Deschutes recently announced its East Coast location will be in Roanoke, Virginia instead of Asheville –most likely because Deschutes wanted to be a game-changer in a city with a smaller, emerging craft beer scene.

Richmond, Virgina, attracted Stone Brewing (based in San Diego, California) for their East Coast expansion. This new brewery is an important part of the city’s urban redevelopment efforts along the James River near downtown Richmond. 

Cities aren’t just looking to attract established breweries; Wildomar, CA has sought to ease regulations to make their community more appealing to would-be brewers. Mesa, AZ, will soon have its first brewery as a result of a concerted effort to revitalize its downtown Main Street. Mesa chose to focus on breweries because of their ability to become magnets and drive a lot of people to an area as well as citizen support for a local brewery. 

States are also following the trend and seeking to encourage the opening and expansion of craft breweries. In 2012 New York State passed the New York Farm Brewery legislation supporting the state's craft breweries by giving them certain tax credits and other perks linked to the use of locally grown ingredients (to boost local farm production). Since then, the number of craft brewers has more than doubled (from 95 to 208), with production growing by 54% from 557,436 in 2011 to 859,535 barrels in 2013. According to a study from the Stonebridge Research Group prepared for the New York Wine and Grape Foundation and the NY Brewers Association on the economic impact of craft beer on the NY economy, craft breweries generated $3.5 billion on the state’s economy in 2013 and provided over 11,000 full-time jobs.

So how can commercial districts and local development officials help and encourage the trend?

Breweries are industrial operations, and they are expensive. Beer is a mass beverage, and even making it on a brewpub scale means you need to have quite a bit of space for the brewhouse, fermentation, and storage. All that equipment costs a lot, and real estate does, too. When you’re spending a quarter- or half-million dollars on equipment, you can’t afford expensive commercial space. So breweries end up on the fringes, in parts of town where the rent is cheap.

If your district wants to attract breweries, the first and foremost requirement is to have enough space ( 2.16 square feet per barrel of yearly capacity, which is equivalent to 2,000 4,000 SF for a very small operation like a nano-brewery to over 15,000 SF for a mid-size operation). Craft breweries not only need large space, but they especially need affordable space (= cheap rent). This might be one of the most difficult challenges because it requires coordination with property owners, and possibly the crafting of some local incentives to offset less-than-ideal rental costs.

In addition, as the study from the Stonebridge Research Group reveals, most new investment in craft breweries in New York State has been self-financed, often with some help from the Small Business Administration. Commercial banks have provided support for some of the larger craft brewers, but not to the small ones.  Thus, assisting craft beer entrepreneurs find financial options and helping them navigate local bureaucracies is another way commercial district practitioners and local economic development specialists can help.

Craft brewers bring not only booze to their neighborhoods, but especially they bring vitality. Breweries are anchors, attracting folks who are curious to try a pint of locally made IPA. They can create little pockets of prosperity in cities that can (and often do) radiate out into the neighborhood. Pretty soon, other businesses see the bustle and consider moving in as well generating further economic activity and revitalization. Once a brewery moves in and refurbishes an old building, it reveals the innate promise of adjacent buildings to prospective renters.

A Case Study in Suburban Retrofitting

A recent article by Dean Saitta in Planetizen about retrofitting dead suburban malls caught our eye. The article covers a dead mall in Belmar, CO, where the former Villa Italia Mall was redeveloped as the Public Plaza at Belmar, a mixed-use New Urbanist development that includes a network of public streets, public spaces, as well as shopping, dining and living options that are more reflective of a traditional downtown than a suburban mall. Lifestyle Centers, open-air shopping centers like these, are definitely not a new concept, but we especially like this project for a few reasons. Perhaps most significantly is that 10 years after its construction, it seems to have matured well. Today more than 2,000 residents live within the area, and the project generates $200 million a year in retail sales, or 2.5 percent of the town's total sales tax revenue. 

Belmar, CO site,
formerly Villa Italia Mall

Belmar...the basics:

• the former mall, a 100-acre superblock was turned into 22 blocks of public streets in a classic grid complete with public infrastructure and amenities that support the case for public/private partnership 
• public plazas were completed that provide the community with a civic gathering spot, and that include large windows in adjacent stores - this in an effort to add visibility and transparency between the public and private space 
• features wide sidewalks and narrow roads that encourage walking and slower traffic 
• the project has one of the country’s largest solar panel systems (8,000 solar panels generating 20% of the site’s energy needs) and almost 88% of the site's materials were recycled or reused from the former mall site, 
• includes housing that was constructed in the American mercantile style that reflects Denver’s architectural history

Site Plan for the Plaza at Belmar

Mixed-use buildings and public plaza
make up the core of the Plaza at Belmar 

Malls were struggling and the development community responded
The issue is widespread. The NY Times reported in 2011 that of the 1,100 enclosed regional malls in the United States, a third have experienced reduced sales and increased vacancies and a third are in financial distress. All-in-all that is a lot of real estate, much of which is in first-ring suburbs. Fast forward four years and many of those malls are being retrofitted and given urban face lifts. 

Suburban retrofitters are beginning to understand the need to honor the human scale, making it less about the car and more about the person. Under performing parking lots are being reduced in size, given bioswells for runoff, additional landscaping and more sidewalks for increased pockets of walkability.  The idea is to bring the city to the suburbs. Many cities - San Antonio, Memphis, Portland, Miami to name a few - have adopted New Urbanist principles that are in line with suburban mall retrofitting. Commercial districts see opportunity as well to create main street centers in new or converted developments to continue position themselves with the market. As Nielsen reports, cities are ideally wanting to attract not just Millennials but Millennials with higher median incomes that are settling down but desire the urban feel and amenities. The trend towards suburban retrofitting fits nicely with the interests of Millennials. 

Financing is always a consideration when discussing a large-scale retrofit and a successful example was seen with the Mueller Development, home to former Robert Mueller Municipal Airport, in Austin, TX. Catellus Development Corp was responsible for building the infrastructure of streets and utilities upfront, while the city retains landownership until vertical development takes place, relieving Catellus of carried land costs and allowing development of individual parcels to proceed incrementally to meet market demand. This has allowed the development of Mueller’s downtown core to come after the residential and internal demand was created.

Further reading: 

Mueller Development, Austin, TX

• Belmar: "Urbanizing" a Suburban Colorado Mall
• Shifting Suburbs: Reinventing Infrastructure for Compact Development
• Belmar in Lakewood, Colorado, Provides Year-Round Activities
• Ten Principles for Reinventing America's Suburban Business Districts
• Why no one likes indoor malls any more

Co-authored by Scott Landfried and Larisa Ortiz