Gregg Reuben, CEO and founder of parking garage owner and operator Centerpark, credited the first business he started when he was 19 and a student at UCLA for his 30-year career. For a gig hosting a weekend car show, he leased a 100,000-square-foot space from a development site next to Interstate 405 in Los Angeles and turned it into a public parking lot during the week when it wasn't needed for the event.

It was a risk because no one knew “if there was a need for a parking lot,” Reuben said in an interview. “It became a hit. During the week we filled up the lot. It really sets the theme for my business going forward: You want to have as much control for your underlying real estate as possible. You want to diversify your revenue and maximize utilization. Over the next 30 years that becomes my theme.”

Fast forward, after stints with what he said are the three largest U.S. parking facilities operators — ABM Parking, Laz Parking and SP Plus — a Harvard Business School degree, and founding another parking management business before selling it, now Centerpark is his answer to apply all that he learned to capitalize on what he calls a “niche” space in New York. He also sees similar opportunities in other gateway cities including Boston and Washington, D.C.

Reuben is bullish on parking despite a decline in ridership as more people work from home and shop online, lessening the need to travel to urban centers.

“I started Centerpark with the intent of creating a company that’s primarily focused on ownership of real estate,” Reuben told CoStar News. He adds that he learned while working for those parking companies that most owners don’t operate and there are “very few” that both own and operate. “There’s a misalignment of interest between operators and owners.”

Here's the supply-and-demand formula behind parking in the heart of New York City: From 2015 to 2022, the number of licensed off-street parking lots and parking garages in Manhattan declined by more than 14%, while vehicles registered to households grew over 27% during the same time, according to Reuben.

“There continues to be significant loss of parking in Manhattan while vehicle ownership and vehicle utilization continue to grow,” he said.

Against that backdrop, Centerpark has spent about $100 million buying a portfolio of 20 parking properties, mostly in or around midtown Manhattan. That includes the recent purchase of two parking condominium properties totaling 40,000 square feet, located within 58 W. 58th St. and 222 E. 58th St. — a 33-story, 168-unit residential building and a 20-story, 260-unit residential tower, respectively — from Muss Development for $8.25 million.

Icon Parking leases and operates spaces at both properties, with Centerpark to become the operator after Icon’s lease in one of the properties expires next year. Icon still has 15 years left in its lease on the other property.

Centerpark is still actively on the hunt and expects by the end of the year it will have 25 or 26 properties, Reuben said. He declined to identify his source of funding, except to say one of his former Harvard professors is an investor and also sits on the company’s advisory board.

“We feel that the fundamentals for parking in Manhattan remain strong,” he said. “It’s unlike any other market. When you look at demand versus supply, it’s very unique. … The challenge for anybody else is it's an esoteric asset class. It requires specific amounts of industry knowledge.”

Even as data shows only about two-fifths of New York employees have returned to their desks, Centerpark’s study citing various research shows the total number of vehicles coming into Manhattan has returned to a pre-pandemic level as safety and other concerns dent public transit ridership.

A case in point: The number of cars in Centerpark’s Manhattan garages rose about 10% last year from the pre-pandemic level in 2019, Reuben told CoStar.

Reuben admits there are market challenges. For one, the supply is an issue. “There aren’t many buying opportunities,” he said, adding there are only over 1,050 parking facilities in Manhattan against 60,000 buildings. Centerpark often proactively reaches out to sellers, many of which have “multigenerational ownership,” he said.

Then there’s the traffic jams.

“The biggest threat to the industry is slow traffic speeds,” he said. “Congestion is our biggest threat. ... The convenience associated with driving and parking in Manhattan, that’s the heart of our value proposition. Congestion can deteriorate that part of the parking proposition.”

Meanwhile, despite inbound traffic recovering from the pandemic, there have actually been fewer cars coming into Manhattan over the past decade, according to Reuben. Still, he feels there are “significant growth opportunities.”

“There are always challenges in the marketplace. We see it as more of a contrarian strategy,” Reuben said. “We identify properties that we feel we still have opportunity to enhance the performances by being an owner and operator. … We are making heavy investments in technology. Parking [operators] have been slow to embrace technology. They’ve been slow to take sophisticated approaches to parking.”

Centerpark is one of the first companies in the industry to build and use a mobile reservation feature, he said, adding it’s also continuing with its “technology endeavors,” including ticketless transactions and digital payments.

As an owner of parking properties, Centerpark also has carved out some spaces for other uses including self-storage, restaurants, gyms and newsstands, according to Reuben. The company said it developed a full-service private parking condominium at 301 E. 69th St. where spaces are selling for at least $199,000 each.

“That’s an advantage of being an owner-operator,” said Reuben, whose entrepreneurial bent dates back to when he was 7 years old delivering newspapers. “We are profitable. Our investors are happy.”