The High Cost of Parking 

One of the most common complaints of people in large urban areas, whether tourists, business travelers, or locals, is that there’s a lack of parking. Parking that’s available is often very expensive – ranging anywhere from $25 a day in Chicago to $65 a day. For condo owners, parking spaces can cost a fortune. A Center for Neighborhood Technology report reveals that, in Chicago, the cost to build a personal parking spot can be more than $37,000 – and purchasing a parking space to own can cost over $50,000 in some of Chicago’s high-rise condo garages. Similar situations exist in other large cities such as New York, San Francisco, and Los Angeles. The absurd truth is that parking spaces cost more than some people earn in a year. This means that, in many cities, only the affluent can afford adequate parking.

The exorbitant cost of parking often makes it difficult and impractical to build new parking spaces. Quite simply, many communities can’t afford to provide more parking. One study of 12 American cities found that the average cost to build a parking space is $24,000 for above-ground and $34,000 for below-ground spaces. These prices assume that the owner already owns the land. Because of this, residents ultimately pay the costs of new parking facilities. This is one of the causes of rising rents, even for people who don’t own cars. So-called free parking is not a solution. Access Magazine reports that free parking requirements raise the cost of housing and reduce density. In other words, the cost is invisible but people are still paying it. And according to CNT, the supply of parking in 4 cities (Chicago, San Francisco, Washington D.C. and Seattle) far exceeds demand. Buildings offer two spots for every 3 units, and in reality (due to the ~33 percent average vacancy) they only need one for every three.

The Environmental Impact of Parking

When people talk about the environmental costs of automobiles, they’re usually talking about moving vehicles. Parking, however, creates its own environmental problems. For one thing, the current parking model is extremely wasteful. People are paying high fees for spaces they only need during certain hours. The above-cited CNT report found that one-third of off-street residential parking spaces are empty at night. If the average person uses these spaces for work, that means that they only need the space for 40-50 hours per week. In a world where, particularly in large cities, there’s a lack of space for affordable housing, this is a significant issue.

There’s also the fact that free parking encourages people to drive. When downtown areas, for example, provide lots of parking access, people who might otherwise take a bus, tram, or train are more likely to drive. A study by Chris McCahill of the State Smart Transportation Initiative found clear evidence that excessive parking causes more driving. This not only means that people with cars tend to drive more, it also influences people’s decisions to own a car at all. In urban areas with extensive public transportation, owning an automobile is often a choice rather than a necessity. More driving, of course, creates a variety of environmental problems, such as air pollution. There’s also the less measurable factor of stress that accompanies traffic jams, which impacts public health. And according to Donald Shoup’s study released in 2011 titled Free Parking or Free Markets, 30 percent of cars in congested downtown traffic are searching for parking. If these “searches” booked their parking in advance, traffic and pollution would be substantially reduced and time and gas would be saved.

It’s safe to say that the current parking paradigm is outdated and full of serious problems. The solution is not to build more parking garages. It’s similar to the supposed solution of building more roads to control traffic. Evidence shows that more roads lead to more traffic. The same is true for parking. What’s needed is a completely new way of handling parking.

The Parking Alternative

Companies like ParqEx, SPOT and JustPark use the Airbnb model to address the urban parking challenge. The basic idea behind all sharing or collaborative economy platforms is to provide services as needed in a fast and efficient manner, by using technology. Consider the difference between the hotel model and the Airbnb model. A hotel has a static number of rooms, whether anyone is using them or not. Meanwhile, Airbnb lets travelers rent space in people’s homes as an alternative to hotels, motels, and B & Bs. In addition to providing people with cheaper rooms, this reduces the need for more hotels and allows people to make some supplemental income.

One major benefit of this type of arrangement is the convenience for consumers, who simply order services by using an app. With these sharing economy “marketplace” apps, users simply search for a parking space and book the spot directly from the app. Not only does the renter gain access to more affordable and convenient parking, but he/she knows there is a spot waiting for them upon arrival. While companies such as SpotHero and ParkWhiz are primarily aggregators of commercial parking garages in downtown areas, the Airbnb model approach allows for individuals, businesses, churches, schools, anyone with a private parking spot(s) to list them on the app/website by the hour, day, week or month – whenever the spot(s) is available. Not only are parking spot owners making supplemental income from their underutilized parking spots, but they are helping their communities by opening up more parking supply in the neighborhood.

With many private parking spots being located behind garage doors or gates, ParqEx differentiates itself from its competitors with its innovative IoT solution called Access+. The Access+ system allows renters and approved users to open any garage door or gate with a click of a button on their smart phones. Implementing Access+ increases rental opportunities, improves transparency into garage usage, and provides great convenience for both owners and renters.

From a parking spot owner perspective, sharing economy parking apps provide a new source of income. Most owners are renting out spaces they already have, so they’re earning money on space that was previously unused. Owners can set their own prices, however, prices are generally lower than commercial parking lots or garages. This is generally true of Airbnb or other sharing economy models of business (like Uber vs. Taxis). Owners and renters engage with each other directly, eliminating the middleman. Since the service providers are not corporations and are using property (e.g. living space, vehicle, or parking space) that they already own, they can afford to set reasonable prices.

How The “Airbnb Model” is Transforming Parking

There are some significant benefits to society as this Airbnb of parking model becomes more and more mainstream.

Faced with a variety of challenges, urban planners are increasingly looking for ways to create “smart cities.” This involves collecting lots of data and finding innovative solutions to issues such as housing, transportation, crime, and other social issues. In some cases, the best solutions don’t require an expensive, centralized solution. ParqEx, SPOT and JustPark provide a smart parking alternative that only requires owners and renters to install an app. Some of the long-term benefits of using this type of smart parking include:

• More affordable, convenient parking for commuters, travelers, and city residents.
• Less need for additional parking facilities.
• More efficient use of resources may lead to less driving and traffic congestion.
• As more people use the app, even conventional parking options are likely to become easier, with less crowded free parking and lower rates for commercial parking.

The way the public has embraced other sharing economy services suggests that people are eager to find new and innovative solutions. More and more services are disrupting conventional business models. In addition to Uber and Airbnb, there are now collaborative solutions in healthcare, web-based services, and many other industries. It only makes sense that there’s also such an alternative for parking.

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It’s a lose-lose situation. Staying in the spot leads to worrying whether your car will be there when you return while leaving the spot leads to circling the West Loop for 20 more minutes with no end in sight. Bleh, I’ll pass on both options. This is where ParqEx comes to the rescue (kind of like when Buzz Lightyear saves Woody from an unscrupulous toy collector – a friend helping a friend out of a bad situation).

ParqEx connects owners of private parking spots to people looking for parking which will solve the urban parking problem. The Center for Neighborhood Technology (CNT) further validates ParqEx’s mission. Parking is a problem that can be solved. According to CNT’s journal titled Stalled Out: How Empty Parking Spaces Diminish Neighborhood Affordability, there are more parking spaces available than parking spaces demanded. So if this is the case, why is it so dang hard to find parking? Because many of the spaces available are not accessible to the general public – spaces in private lots that are sitting vacant. According to the journal, parking spaces in Chicago can cost upwards of $37,300 to build, while about 1/3 of these spots are sitting vacant in an indoor residential private parking garage. Someone has to cover the cost of these spots and it’s usually people like me and you — people who rent apartments/condos.

While these spots remain unused, you just spent money on them. Your rent is $1300/month instead of $1150/month because your money is being used to cover the costs of unused spaces. Yeah, I’m not happy about it either. Good news: we can change this, and the folks at ParqEx are doing just that by making these unused parking spaces available to more and more people. By doing so, drivers can more easily find available parking without wasting their time, and building owners generate revenue by listing unused spots on the ParqEx platform. This cycle leads to more affordable neighborhoods and more available parking, turning a lose-lose situation into a win-win.

Now that we have your attention, we’d love for you to read more about the parking problem and how it can be solved. The Center for Neighborhood Technology has written an amazing journal that you can read by clicking HERE!

About ParqEx:

ParqEx is a technology company that connects owners of private parking spots to people looking for parking. In urban areas where parking demand is high but available options are scarce or expensive, ParqEx makes additional supply available to the driving public by listing exclusive inventory owned by local residents and businesses.

Using ParqEx, parking owners are able to make some supplemental income from an underutilized asset while renters get access to exclusive inventory in more convenient and hard-to-park locations. The ParqEx support team ensures that the entire process of listing, reserving, parking, and paying is as smooth as possible for all involved.

ParqEx has also developed the revolutionary Access+ Technology. With Access+, residents and approved visitors can open the garage door from their smartphones. Property managers and condo boards can simplify management and improve control of the garage.

Don’t have our parking app yet? Get it now @ParqEx on the App Store and Google Play!

Watch our short video to see the beauty of the ParqEx app!

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