CORONA DEL MAR, CA – It’s no secret that technology is altering the way the consumers go about their lives. Just consider the following changes: ordering food; watching TV and movies; making travel arrangements; and buying groceries, electronics and clothing. There are few segments of the economy that have been left untouched, and as companies like Airbnb and Uber expand—and demographics continue to push amenities and workspaces in new directions—commercial real estate is wondering which sector will join DVDs in the dust bin of disruption. Will it be parking? That’s what Carlos Lopez of Hanley Investment Group suggests.
GlobeSt.com caught up with the EVP at the Orange County-based company to get his birds-eye view in this EXCLUSIVE interview for the ICSC RECon event.
GlobeSt.com: What are some of the changes impacting parking?
Lopez: While the driverless car as a mainstream mode of transportation remains a thing of the future, ride sharing services like Uber and Lyft, in essence, perform the same duties for many and are becoming a part of the everyday vernacular. The question arises as to what will be the future impact on parking in real estate and future development. Green Street Advisors estimates that the current parking needs will be cut in half in the next 30 years eliminating the need for 75 million square feet of parking space. In addition to the reduction in cars, from a demographic standpoint, millennials being the largest demographic sector are most likely to take public transportation, less likely to own a car and 18% of this demographic base as a percentage of the age group is less likely to have or obtain a driver’s license than in the past.
GlobeSt.com: How have these trends impacted parking requirements?
Lopez: In many urban cities throughout the United States, regardless of the number of bedrooms, developers are only providing one parking space onsite per apartment or dwelling unit. In cities like Boston and Santa Monica, new condominium and apartment developments have been approved with no onsite parking at all. Close proximity to transit and being located within the central city core were reasons cited. In Downtown Los Angeles, instead of providing onsite parking, an apartment building owner offers residents a $100 Uber concession each month.
Much has been written about the impact of e-commerce, the internet and demographic shifts in the retail industry. Retail bankruptcies, the downsizing of a retailer’s footprint and store closures are reducing, but not fully replacing, the “brick and mortar” format. As the traditional retailer, and the shopping centers and malls that serve them, shift to find their ideal format and size, the parking requirements and parking fields are also changing to accommodate retailers’ new prototypes.
GlobeSt.com: What are some of the examples?
Lopez: Amazon has recently announced the launch of “AmazonFresh” pickup service to compete in the “click and collect” grocery format that Kroger and other retailers such as Walmart and Target are adding. This new service allows customers to place an order online and pick it up in as little as 15 minutes from a drive-in kiosk. Fast-food has also gotten faster with mobile ordering. Dunkin’ Donuts, Chipolte, Taco Bell and Starbucks, to name a few, already allow customers to place orders online. McDonald’s is jumping on the bandwagon and has said it is launching mobile ordering, mobile pay and curbside pickup across its 14,000-plus U.S. restaurants in the fourth quarter. Starbucks plans to open more “drive-thru only” formats (typically less than 1,000 sq.ft. with no interior café), which are situated on smaller corner lots in high-traffic locations. For those that don’t want to leave their desk or home, restaurant chains like McDonald’s have partnered with apps such as Uber Eats, Postmates and GrubHub to offer pick-up and delivery services to customers in approximately 30 minutes. Certain mall developers have implemented a concierge service that offers refreshments and merchandise storage to those customers using Uber and will provide a free shuttle service during busy holiday seasons.
GlobeSt.com: What do you see on the horizon?
Lopez: Incorporating the latest innovations in smart technology is the next frontier in parking structures in urban cities and retail districts. Sensors are already being used to detect unused parking spaces so that information can be relayed to drivers. This technology creates better traffic flow, reduced pollution and, certainly, reduced frustration for drivers. In the future, smart technology will allow drivers the opportunity to reserve parking spaces ahead of arrival, and pay for parking in advance or at the time of use. Other technologies such as robotic valet parking are currently being implemented. As self-driving vehicles become part of the landscape, parking lot developers anticipate potentially smaller garages as self-driving vehicles take up less space and need less lighting and ventilation, etc. In cities, such as Denver and Miami, innovative developers have designed parking garages that can accommodate retail on the ground floor when demand for parking is reduced.
Additionally, developers are building parking structures with flat floor plates instead of sloped floors so that future commercial uses could incorporate higher ceilings and skylights where the interior ramps were located. In Downtown Los Angeles, KTGY Architecture + Planning redesigned the ground floor of the existing parking structure at 8th and Francisco streets to accommodate a much-needed emergency medical services center and, due to its success, is adding more street-front retail there.
GlobeSt.com: Anything else that you would like readers to know?
Lopez: Retail developers can offer larger drop-off, pick-up and e-hailing zones to better serve their customers seeking a retail or restaurant experience as well as for ride sharing and drop-off service. Smart technology in parking facilities will allow drivers to have a seamless process and convenience. Finally, innovative design will permit developers to serve current parking needs and customers, tenants or residents, while preparing for future development and alternate uses as overall parking space use declines.
Visit Hanley Investment Group at Booth #S381S at ICSC RECON in Las Vegas.