For years, Marc Clear and his architectural team have envisioned sports fields south of downtown Atlanta taking over a patch of asphalt that has long been used for parking.
The principal in the Atlanta office of architecture firm SLAM Collaborative is working with Georgia State University on a new future for the lot next to Center Parc Stadium, the former Atlanta Braves' Turner Field now used for school football games at 755 SE Hank Aaron Drive. Clear led the design of baseball and softball fields that could be built as part of a 68-acre redevelopment including apartments and retail space.
In replacing parking lots, "you're improving the use of the entire site," he said.
Across the country, a glut of spaces has property owners and developers considering redevelopment opportunities for parking lots.
To that end, some cities are abolishing requirements that each parcel contain a certain amount of parking, freeing up developers to put up more and bigger buildings. In 2022, California approved a law that cities couldn't impose minimum parking requirements on new developments within a half-mile of public transit, encouraging more housing to be built in areas that don't require cars.
In some jurisdictions, more parking appears to be getting demolished these days than built. Los Angeles and San Francisco counties, along with the cities of Chicago, Philadelphia and New York, for example, had more parking spaces sold for redevelopment since 2010 than were created, according to CoStar data.
Construction of new apartments in those areas had fewer parking spaces per unit built between 2018-2022 than in 2008-2012. The only exception in the group: Los Angeles County, America's largest county by population. It had more than 1.4 parking spaces built per apartment unit between 2018-2022, up from a little more than 1.2 parking spaces built per unit between 2008-2012, according to CoStar data.
At the same time, as officials rethink the need for so many surface lots, some critics of a wide-scale move away from parking say that real estate under those spaces may become more valuable as supply and demand reach an equilibrium. A JLL study found that cities demolishing parking may create "additional pressures on parking availability [that] could result in strong income growth for parking owners over the few years, if not much longer."
Potential Middle Ground
In some cases, a middle ground may be forged. Clear said the new Atlanta development will result in a similar amount of parking on the 68-acre property as what's there now because it will include multi-floored parking garages that will replace surface lots.
In general, other options for parking can include subterranean parking and parking incorporated into structures.
"Parking lots don't have to be the front door to your venue," Clear said.
Some real estate analysts say it's impossible to generalize whether parking spaces will reach an equilibrium across the United States or demand for parking could grow if more lots are demolished. Part of the problem is that there is little aggregate data quantifying the nation's parking. The Wall Street Journal has estimated there are 700 million to 2.5 billion parking spots across the country, translating to between two and seven spots per registered vehicle.
Investors are betting that parking is here to stay, even if it takes up less surface area. Capital continues to flow into parking lots, even into tech startups devoted to parking. Metropolis, a parking lot manager that uses an app to charge customers to park, has raised roughly $228 million since it was founded in Los Angeles in September 2017.
Some of America's biggest parking companies grew last year as parking revenue rebounded from pandemic lows. For Chicago parking giant SP Plus, total services revenue rose more than 22% in 2022 from 2021 as travel and commuting increased in a recovery from the pandemic's early months. Marc Baumann, CEO of SP Plus, said in a fourth-quarter earnings call in February that parking rates have gone up as people drove more after the pandemic, increasing demand.
"There is a lot more travel and commuting to work and to other places by cars than there was before, Uber and Lyft rates have gone higher or often waiting times are higher and so as a consequence, there is definitely the ability to raise parking rates," Baumann said.
Parking, though, remains among the lowest land value uses and is just a step up in many cases from simply leaving the land vacant, said Mike Manville, associate professor of urban planning at the UCLA Luskin School of Public Affairs. Many surface lots and parking lots exist in cities because the land hasn't been seen as valuable enough for development.
Manville said whether parking demand may finally catch up with supply will depend on each location. Cities with expanding economies may find that land that has historically been used for parking could be more profitable to convert into something else. Other parts of America with population declines may continue to see a parking abundance.
Gradual Change
At the same time, most of the U.S. still requires parking minimums, meaning that supply and demand for parking could remain out of balance. Manville said turning off parking minimums won't change car culture overnight in American cities that have designed themselves around parking minimums and driving.
"There are consequences to designing and regulating cities like we have for decades," Manville said. "You've upset the market equilibrium" for parking supply.
In 2004, a major Southern California apartment owner got into the parking business by happenstance.
Advanced Real Estate, based in Irvine, bought a garden style multifamily building that had metal lifts that hoisted cars in the air and allowed for another vehicle to park underneath. The company liked the concept and improved on it by replacing the parking spaces with better lifts.
That's when Advanced realized it could sell this technology to other apartment owners before creating the company Vertical Parking Solutions. Now, Advanced Real Estate has more than 1,000 parking lifts at its own properties and sells the lifts for roughly $14,000. The lift creates anywhere between $20,000 to $30,000 in value per spot for apartment owners, Advanced President Paul Julian said.
Julian said he knows the technology is a temporary solution. After all, the lifts themselves last 20 years and future advances may render the personal car obsolete in a couple of decades, he said.
Even so, "until we get to autonomous cars, if builders are building less parking, we will have a bit of a parking pinch," Julian said.
Parking almost certainly will remain in vogue for higher-end apartment owners in the years ahead, even if their properties are near mass transit stops, said apartment analyst Kitty Wallace, who is the senior executive vice president of Colliers in the firm's Los Angeles office. Southern California apartment owners see higher values for apartment buildings with ample spaces, she said.
Building parking, though, remains costly, Wallace said. A podium parking spot, which is parking at grade with apartments above, costs roughly $25,000 per spot to build. Subterranean parking is $60,000 per spot.
Higher Rents
That means apartment development with enough spaces for residents needs to command higher rents in order to pay for the construction. That may not be a problem for renters who pay well above market rents and have a car versus renters making less who prefer to live near mass transit stops, Wallace said.
She adds that parking is slightly less needed these days than it was a decade ago in parts of Southern California because of the region's ongoing investment in public transportation. However, parking is still very much in demand in similar car-dependent parts of the United States, she said.
"We're not in the horse-and-buggy stage," Wallace added. "No one has come up with a such a brilliant idea that you don't need your car."
In Atlanta, the surface lot envisioned for a baseball and softball stadium is still used for parking. Clear said the lot is mostly filled with the cars of commuting students and faculty who take shuttles to class.
Clear said he's convinced, though, that change is coming for parking lots and demand for spaces in the years ahead.
"We have to look at different ways" to park, Clear said.