Multifamily Parking: Too Many People – Too Few Spots

Print Friendly

Multifamily parking has a significant influence on reputation and is one of the most mentioned amenities in all levels of reviews of multifamily properties.

Metropolitan areas are awash in parking, which gives the impression that no parking issues should exist at all. However, many metropolitan areas have made a 180-degree turn in their approach to parking. Eleven cities, including Seattle and Lexington, Ky., reversed course in 2022 and switched to parking maximums. This is creating a parking environment in multifamily replete with challenges.

Fewer spaces don’t need to translate to parking problems. Proper management of available spaces is essential to keeping the peace in a community, causing owners, operators and developers to assess ways to increase housing and avoid parking shortages.

Why Multifamily Parking is Becoming an Issue

For decades, local officials in most cities enforced regulations requiring a minimum number of parking spaces for any commercial real estate or multifamily property constructed. Although it seemed appropriate at the time, this has created a landscape covered in asphalt, and it’s having a negative impact on the nation’s housing crisis. Multifamily developers are putting emphasis on the number of units, not parking. It’s expensive to construct lots, particularly in urban areas, and many developers prefer to forgo as much of that expense as possible.

Many metros are now reversing course, changing parking minimums to parking maximums. This attracts more developers since they’re no longer required to sacrifice a portion of their return on investment for additional spots. Unfortunately, the reduction in parking availability is coming when many residents still struggle with the cost of housing.

The sharp rise in rent growth over the last few years, spurred partially by a lack of housing supply, encouraged a greater number of residents to find roommates or enter into a co-living arrangement. While rent growth has slowed, there hasn’t been enough of a contraction to encourage more people to go solo. Depending on how many of them have cars, this can create a situation where a community has more cars than spaces or is mismanaging the spaces they have. Either way, it can lead to frustration, increasing complaints and conflict among residents.

Other factors that may influence parking availability are location and proximity to public transportation and bike routes. If the property is a mixed-use building, residents are forced to share spaces with the businesses.

The Impact on Reputation, Retention and Onsite Teams

Any community where residents cannot locate a spot or continually find someone illegally parked in their assigned parking space is going to face retention challenges.

People don’t want to live in a place where they need to speak to management on an ongoing basis or wait for a tow truck to finally make their space available again. They are more likely to move somewhere that has less hassles.

As a result, onsite teams will need to devote more time to finding new residents when they could instead be building solid relationships with members of the community.

Taking a look at online reviews of any multifamily community, it’s easy to see that the one- and two-star reviews of residents are very long. When one thing sets them off, there is a tendency to find anything else they can to express dislike. Multifamily parking has a significant influence on reputation and is one of the most mentioned amenities in all levels of reviews. A lower reputation score makes it harder to generate solid leads and makes attracting prospects even more of a challenge for onsite teams.

The Financial Impact of Bad Parking

When retention efforts are insufficient, owners and operators are faced with turnover costs, which can cost thousands of dollars per unit even with a quick turnover. Each day a unit sits unoccupied is a day where it isn’t generating any revenue.

Filling those vacant units is going to be a greater challenge if a community’s reputation score is low. To attract more residents, advertising and internet listing services (ILS) need to be increased, pushing costs even higher and chipping away at net operating income. Amounts are irrelevant when it comes to revenue losses that could have been avoided — any figure is dissatisfactory.

Increasing parking requires a hefty layout of capital and can reduce curb appeal if green space is reduced to provide more space. Building a parking structure is an even larger investment.

Communities Are Seeking Relief

Communities, onsite teams and residents don’t want to deal with the headaches and friction a challenging parking situation creates. The Bella Mirage in Avondale, Ariz, faced a shortage of parking that was developing into a hazard with people parking in fire zones. Their team was also burdened with numerous complaints from residents about the parking issues.

“When any parking complaint came in, we would give them a flier explaining the system we use and how to reserve spots,” said Ashley Gayden, community manager at Bella Mirage. “We also put it in our move-in packets. Many of our residents are fine with using it, even with the low cost, and they end up using it the entire time they live here. The complaints have been drastically reduced. It’s few and far between at this point.”

There are any number of factors that will influence parking in a community and possibly create challenges for residents and the community management team.

According to Kohl Eisenhour, executive vice president at Avenue5 Residential, “Parking is one of the top three resident-experience issues.” Avenue5 has implemented an automated parking-management platform to address various challenges, including parking location, accessibility, and shortages. “A parking-management solution has alleviated onsite team stress while significantly reducing the time they had to devote to parking issues.”

The key is to be proactive to issues instead of reactive to them. Owners and operators, as well as property teams, need to gain a comprehensive understanding of pain points within their parking management before the issues create a negative impact on retention and reputation. Whether complex or simple, gathering this information can help teams implement solutions to save revenue and reduce stress for residents and onsite associates.

Source: Rental Housing Journal