Parking Lots and Garages

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 2,700 parking management companies in the US provide parking space in lots and garages for motor vehicles on an hourly, daily, or monthly basis. Some firms also provide valet parking services or collection services for on-street parking meters. Firms may own parking lots and garages or may operate them on a contract basis for others, including municipal governments, hospitals, airport authorities, or commercial building owners. Large firms may also operate related transportation services, such as airport shuttle services or taxi dispatch services.

Managing Security And Safety Issues

Security and safety issues for parking lots and garages include traffic hazards, pedestrian falls, crime, and theft of credit/debit card information.

Dependence On Gasoline Prices And Economy

Demand for parking lots and garages is driven primarily by commuters to work, shoppers, airline travelers, hospital visitors, and event attendees.

Industry size & Structure

A typical parking management company employs fewer than 20 workers and generates about $3 million annually.

    • The industry consists of about 2,700 companies with 12,500 locations that employ 115,000 workers and generate $8 billion in annual revenue.
    • The industry is concentrated at the top with the largest 20 companies generating 53% of industry revenue.
    • Large companies include SP Plus, Ace Parking Management, LAZ Parking, ABM Parking Services, Impark (Canada and US) and Park Inc.
                                      Industry Forecast
                                      Parking Lots and Garages Industry Growth
                                      Source: Vertical IQ and Inforum

                                      Recent Developments

                                      Jan 8, 2024 - Garages Employ Robot Security
                                      • Some parking garages are beginning to implement new security measures, such as autonomous robots, to augment their security and deter crime, according to an article in the Greeley Tribune. The LoDo Towers parking garage in Denver, Colorado, has leased two robots to surveil the property using pre-programmed routes. If someone lingers too long in the garage, the robots will notify a human security officer to investigate. The robots, which are about 5 feet tall and 3 feet wide and weigh 420 pounds, can detect fire and gunshots and make emergency communications. They also record video on their routes. Since incorporating the robots more than a year ago, the garage says it has seen a 70% drop in car thefts and vandalism. The company that made the robots, Knightscope, said the robots are deployed in a range of properties, including parking garages, office buildings, airports, hospitals, and manufacturing sites.
                                      • Parking lot and garage operators will have to monitor minimum wage changes, as 22 states increased their minimum wages in January 2024, according to USA Today. About half of the increases are automatic adjustments linked to inflation. States that raised their minimum wages in January 2024 include Hawaii ($14), Maryland ($15), Nebraska ($12), and Washington ($16.28). Several states are set to boost their minimum wage levels later this year, including Florida (up to $13 in September) and Nevada (up to $12 in July). According to the Economic Policy Institute, nearly 40 US cities and counties will increase their minimum wage rates above state levels at the start of the new year. The federal minimum wage is $7.25 an hour, and more than 20 states, primarily located in the South and the Midwest, use the federal minimum as their wage floor.
                                      • Lower consumer spending, competitive pressures, and ongoing work-from-home trends are expected to limit growth in the US parking lots and garages industry, which is projected to increase at a 2% CAGR from 2022 to 2027, according to a recent Inforum forecast. This rate is slower than the projected growth of the overall economy. The forecast follows a volatile period during the pandemic, with a sales drop of 9.1% in 2020, an increase of 23.8% in 2021, and growth of 10.5% in 2022.
                                      • Austin, Texas, has joined other major cities in eliminating its minimum parking requirements for developers. In recent years, major cities such as San Jose, Portland, and Minneapolis have dropped their parking requirements, citing reasons such as reducing development costs, freeing up space for more housing, becoming less car-dependent, and lowering carbon emissions from fewer cars on the road. According to the Texas Tribune, Austin became the largest city in the US to take the step when its city council voted in November 2023 to eliminate minimum parking requirements for most properties citywide, including offices, malls, single-family homes, and apartment complexes. Opponents of eliminating parking requirements express concerns that the lack of required parking on-site may cause overflow parking on neighboring streets and create hazards and congested roadways. Developers in Austin are still required to provide accessible parking spots, consistent with federal law. The city is also keeping special zoning districts for some neighborhoods that will follow the city’s former parking minimum rules.
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