There are many changes in the world of transport and many of them are due to a large degree of innovation and shifted consumer attitudes in this sector. The Sharing Economy is being applied to the transport industry more and more and public transport is becoming quicker and better networked – admittedly from a superordinate perspective. Autonomous cars are surely only a few years away from the market. With so many new developments in traffic, it is only logical, that parking is currently undergoing a transformation process.
The ongoing headlines in the European press saying that “parking needs to be forced away from the city centers”, may be the political demand in the short-term but causes a clearly altered price structure for users – wherever we are located in Europe. With the result being that the demand for a parking space is because of a larger degree of comfort and space, which can be seen in the willingness to pay.
Currently, the following factors describe the transformation process most accurately:
- A clearly increasing popularity of car-sharing, which also makes pick-up spots necessary
- Carpooling models decrease the demand for parking spaces at the destination
- Ride-hailing services, such as Uber & co., increase the demand for shorter car rides, as they offer the customers more comfort and lower prices – especially compared to standard taxis.
- Automated parking systems
- Self-driving cars
With these developments in the mobility sector – surely with different impacts and probability of occurrence – the “latent traffic”, known as parking, will largely change. In the course of this, the classic MPF, multi-story parking facility, will experience the most change. Especially in times of increasing inner-city scarcity of space, they play a key role for the implementation of new mobility concepts. One thing that is becoming increasingly clear: the most essential point is the transformation of mere parking garages to turning points in the mobility network, so central places in the modal split.
Did you know which variables influence the price of “parking”?
- Time: Low coefficient due to the probable shift from long-term to short-term parking
- Space: High coefficient due to higher space efficiency, which will make larger parking spaces more expensive
- Reservation time: Medium coefficient as reservation will be highly demanded, due to increased time efficiency and convenience
- Charging time: medium coefficient (for the time being), currently merely an additional service
- Initial price: high coefficient due to the likely shift from long-term to short-term parking
- Proximity to destination: Medium coefficient due to convenience to consumer, but relative difficulty of judgment
The occurrence of innovation in traffic, but also the metamorphosis of European city centers and a changed modal split, does not mean the end of the classic model of parking. At the same time, the focus of real estate will be on the transformation of multi-story parking facilities in the coming years. MPFs will achieve much larger returns because of the changes. There will surely not be a future in which parking is no longer necessary. From the perspective of an investor, this transformation process offers more opportunities than risks.