For serious commercial investors and developers, parking lots and garages often make a great deal of sense. After all, parking structures are comparatively cheap to build, cost-effective to maintain and easy to fill. Could the era of the large-scale parking garage be coming to an end, though?
Houston is a massive city that is full of cars, trucks, SUVs and commercial vehicles. These vehicles need somewhere to park, making commercial parking structures popular. Nevertheless, in addition to normal commercial building concerns, three future risks may cause investors and developers to think twice.
1. Ride-hailing services
For decades, business insiders have predicted a decline in car ownership. If vehicle ownership falls, commercial parking may become less of an appealing investment.
Ride-hailing services, such as Uber and Lyft, have provided a ready alternative to car ownership. These services are likely here to stay, with nearly 40% of Americans claiming to have used them.
2. Public transportation improvements
According to media reports, government leaders in the Houston area have a plan to build over 500 miles of new public transit. This plan includes park-and-ride stations, train lines and bus routes.
If more Houstonians commute on public transportation, new commercial parking structures are apt to become less necessary.
3. Autonomous vehicles
While the large-scale introduction of fully autonomous vehicles is likely years away, self-driving cars are apt to become a reality eventually. When they do, urban parking is probably going to change significantly.
Some city planners predict autonomous vehicles may move parking structures from downtown areas to peripheral parts of the city. If this happens, ride-hailing services continue to grow and public transit improves considerably, investing in commercial parking may become increasingly risky.