How to Find and Manage the Perfect Parking Lot for Rent in 2024

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Arriving at a preferred shopping location only to find the parking lot full is a common and frustrating experience. This issue negatively impacts both businesses and customers. When parking is challenging to locate or heavily congested, it inconveniences visitors and may discourage repeat visits. Business owners and property managers can enhance the parking experience for their customers by optimizing parking operations. A parking lot for rent might be the necessary solution. This blog will examine the importance of renting an empty lot within your area and how it can streamline parking management systems and improve customer service.

Shift your parking operation into top gear is a valuable tool from Parqour for achieving these objectives. This innovative software can streamline parking operations and improve the customer experience.

Why Invest in a Parking Lot?

Investing in parking lots may seem odd. After all, there are about two billion parking spaces in America compared to roughly 250 million cars. How can parking lots be a good investment with an excess supply like that?

The answer is complicated, but experts agree that significant dynamics are at play right now, making parking lots a choice investment. Here are some of the most essential advantages of investing in commercial parking lots.

Supply Is Declining

There are already around two billion parking spaces in the U.S. That’s about four times the number of cars in the country, so there’s a bit of a glut. The number of parking spaces in the U.S. is declining. And many areas where they’re disappearing are where parking is in the highest demand.

Until recently, up to a third of all land in U.S. cities was taken up by parking. This was primarily due to post-war zoning regulations that incentivized car ownership and mandated a certain amount of surface parking for every new building.

Parking's Decline

In Buffalo, NY, the amount of required parking was so high that half of downtown Buffalo was parking lots. Urbanists and developers eventually realized that devoting this much land to parking economically hindered cities.

Many cities have made zoning changes that sharply cut or even eliminate required parking with new developments. The upshot is that, as cities repurpose parking lots in urban centers, parking is rapidly declining — and the remaining parking lots are increasing in value.

Parking Lots Require Very Little Maintenance

Nearly every other real estate investment requires at least moderate maintenance. Single-family homes require around 1-4% of their value on maintenance annually. Buying a multifamily property usually requires hiring a professional property management company. While essential, these services take a big chunk of all rents collected.

Parking lots, on the other hand, require little maintenance. There isn’t much else to be done other than the real estate commission you might have to pay on the initial purchase routine cleaning of trash and spills:

Keeping the draining clean

Maintaining the fencing and gates

Sealing small cracks

Seal coating the surface every few years

It’s as close to a zero-maintenance real estate investment as possible.

Location, Location, Location

Most parking lots are in commercial areas or urban centers. These are some of the most lucrative places to own real estate. A single parking space in Brooklyn was selling for six figures. Parking lots possess significant value, as evidenced by the high rates individuals are willing to pay to use a small portion of the space for a single day or even an hour.

If you eventually decide that you no longer want to operate your parcel as a parking lot, you’ll have plenty of options to sell or repurpose it.

The Parking Lot Market Is Fragmented

Parking lots aren’t like suburban housing developments that are so predictable that an iBuyer’s algorithm can accurately value them. Every parking lot is unique, as is the market. This means individual investors willing to do some on-the-ground research can uncover great hidden gem investment opportunities.

Little Competition for Parking Lot Investments

One of the significant upsides of moving into a market that’s as untapped as the commercial parking lot market is that it’s what’s known as a blue ocean, an unexplored market that’s:

Wide

Deep

Open

Limited Competition

While this will likely change as more investors catch onto commercial parking lots’ profit potential, you’ll likely have very little competition. In a compressed, well-known market, you compete against many other investors, and margins are smaller.

In a market like commercial parking lots, it’s easier to find high-quality investments to help you meet your real estate investment goals.

You Can Incrementally Invest in Parking Lots

Many other commercial real estate investments are all-or-nothing. You can’t buy half of an office building or a quarter of a warehouse. If you’re looking to invest in parking lots, finding smaller, piecemeal investments is highly possible.

Investment Options

Many parking lot developers will sell single spaces to investors to raise development capital. As such, it’s an excellent way for novice parking investors to get a small foothold in the field. Some REITs specialize in parking facilities, which let investors buy into a portfolio of properties and share in their potential profits.

Buying into commercial parking facilities via a REIT will let you get the feel of the market and see what real-life returns look like from different investments.

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Why Renting a Parking Lot Could Be a Smart Investment

Start Small and Grow Your Parking Investment: Minimal Initial Investment

Renting a parking lot requires significantly less capital upfront compared to purchasing one. This makes it an attractive option for investors who want to enter the market without a significant financial commitment.

The reduced need for upfront funds allows you to allocate capital to other areas of your business or investment portfolio, maximizing your overall financial flexibility.

Test Profitability Before Making a Long-Term Commitment

Renting allows you to evaluate the profitability of a specific location before making a long-term commitment. You can monitor customer demand, traffic flow, and revenue generation over time.

If the lot proves profitable, you can consider purchasing the property. If not, you can move on without being tied down by ownership, minimizing your financial risk.

Switch Locations Easily

One key benefit of renting is the flexibility to switch locations if the current lot doesn’t meet profitability expectations. This is particularly important in a competitive market where consumer preferences and traffic patterns can shift.

If a lot’s performance declines or better opportunities arise elsewhere, you can transition to a new location without the hassle of selling property.

Respond to Business Growth

As your business grows, renting allows you to scale up by moving to larger or more strategically located parking lots. Conversely, if you need to downsize, you can easily adjust your rental agreement to match your current needs.

Reduced Long-Term Risk

By renting instead of buying, you avoid the risks associated with property depreciation and market downturns. This reduces the financial burden of owning a potentially declining asset and allows you to maintain a more stable investment strategy.

Lower Maintenance Responsibilities

Renting often means the property owner is responsible for major maintenance and repairs, reducing the time and money you need to invest in upkeep.

This allows you to focus on maximizing revenue from the parking lot rather than dealing with costly renovations.

Experience Parqour in Action

Book a free demo to learn how Parqour can shift your parking operation into top gear!

How to Find the Perfect Parking Lot for Rent

Finding an ideal parking lot for rent takes a lot of work. Fortunately, online listings make it much more manageable. Websites like Leeveit provide a comprehensive list of available commercial parking lots for rent.

These websites allow you to filter your search based on location, size, and price, making it easier to find the right parking lot for your business.

Get the Word Out to Locate a Vacant Commercial Parking Lot

Another great way to find a parking lot for rent is to ask around. Word of mouth is often the best approach to locating a vacant commercial parking lot. If you need to find a parking lot, ask other local company owners if they know of any for rent.

There is a good chance they might know of a fantastic spot that hasn’t been advertised. But yet again, this may seem like backbreaking labor. So, why not go with an easy option— leeveit?

Drive Around to Find a Commercial Parking Lot for Rent

Driving around the local area can be an effective way to find a commercial parking lot for rent. Take note of any parking space you see and jot down the contact details displayed on any for-rent signs you may come across.

Also, drop by local commercial real estate offices and inquire about any vacant parking spaces they may have.

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5 Factors to Consider When Renting a Parking Lot

1. Location

Location is essential when probing for rent in a commercial parking lot. The parking lot should be located in a safe and convenient area that is easily accessible to your consumers. It’s preferable if it’s close to your place of work, if not right there.

2. Size

Another thing to think about is how big the parking lot is. Make sure it’s big enough for all your customers’ cars, plus any delivery trucks or service vans that might need to use it. If you have a more significant business or anticipate a high traffic volume, a more considerable parking lot like 4 Extra Large Office Parking may be necessary.

A huge parking lot may be unnecessary for a small business because it can cost you a lot of pesos. When discussing businesses and pesos, it is the right time to articulate how to take an edge from the leeveit platform.

3. Lighting

Customers’ safety should be the top priority when looking for a commercial parking lot for rent. After all, you’ll be offering that space to your customers and employees, and ensuring safety involves looking for lighting in the parking lot. The parking lot should be well-lit, especially at night.

Adequate lighting deters criminal activity and makes it easier for customers to locate their vehicles and feel safe walking to and from their cars.

4. Security

When deciding on a commercial parking lot, safety measures should be prioritized. It’s essential to check whether or not the parking lot has proper security features like:

Surveillance cameras

Guards

Ggate

Easy Search

Finding a parking space with such features can be a daunting task. This is because it is not easy to ask every parking space owner whether they have these features— and this is where leeveit will pique your interest.

Just specify what you need under the features section, and you’ll get the list of options with the features selected.

5. Terms and conditions

Parking lot leases can vary significantly, so it’s vital to evaluate the terms of the agreement before signing on the dotted line. Look for the lease duration and any renewal options. If your business expands, you may require a larger parking space in the next year or two.

In this case, you will want to ensure you have the option to exit the lease early or transfer it to another tenant if necessary.

Understanding the Financial Obligations When Renting a Parking Lot

Of course, the cost of renting a parking lot will play a significant role in your decision. You will want to evaluate not only the rental rate but also any hidden fees that may be associated with the lease.

Some landlords may charge extra for upkeep or require tenants to pay for their security. Ensure you understand the landlord’s responsibilities versus your own to avoid surprises.

Types of Parking Lots Available for Rent

A surface parking lot is a site or a portion of a site used for ground-level off-street parking of vehicles and is usually not covered by a structure. It may be owned by an:

Investor

Private individual

Business

Government entity

These lots often sit in busy downtown areas, near transit lines or commercial districts. They can be gated or monitored electronically, and drivers or valets can park cars.

Multi-Level Parking Structures: Smart Solutions for Off-Street Parking

Parking garages, also known as car parks, are built explicitly for off-street vehicle parking. They are usually built near high-traffic areas, such as:

Retail shopping centers

Office buildings

Stadiums

Parking garages typically have multiple levels and may include features such as electric vehicle charging stations and car wash facilities.

Underground Parking Facilities: The Savvy Choice for Space-Saving

More space above ground is needed in many areas to create sufficient parking. Underground lots fill this need, and several subterranean parking floors are below ground.

These parking garages usually reside underneath large structures and require sufficient ventilation systems for the enclosed spaces.

When to Rent vs. Buy a Parking Lot

In Your Face, Short-Term Needs

Renting a parking lot might be the better option when your needs are temporary. Imagine you need parking for a:

Construction project

Seasonal event

Temporary expansion

Renting offers flexibility without the long-term commitment of ownership. If you're a business looking to expand into a new market, renting a parking lot allows you to test the location's viability without the risk of purchasing property. This is particularly useful for companies that are still determining long-term demand.

Market Uncertainty Is No Problem When Renting

Purchasing a parking lot during fluctuating real estate markets can be risky. Renting allows businesses to adapt to market conditions without the burden of a depreciating asset. During economic downturns, capital may be better allocated to core business activities rather than real estate.

Renting allows businesses to conserve cash and maintain liquidity. Suppose there are potential zoning laws or changes in local regulations that could impact parking lot use. In that case, renting prevents businesses from being locked into a potentially problematic investment.

Cost Management

Renting a parking lot typically requires less upfront capital than buying, which can be crucial for businesses with limited budgets or those looking to allocate funds elsewhere.

Property owners often take responsibility for significant repairs or renovations, meaning renters can avoid these additional expenses and focus on their core operations.

Flexibility and Scalability

As a business grows or needs change, renting offers the flexibility to upscale or downsize more easily. This adaptability is essential for companies with fluctuating demand or evolving strategies.

Renting also provides an easy exit strategy if a location becomes less desirable or profitable, allowing businesses to move to a better location without the complications of selling property.

Tax and Financial Considerations

Rent payments are often fully deductible as business expenses, which can be more straightforward than managing owned property's depreciation and tax implications.

Renting also avoids the need to take on debt, which can be beneficial for maintaining a healthy balance sheet and credit rating, particularly in uncertain financial times.

Tips for Managing a Rented Parking Lot Successfully

A parking lot rental can be a great way to make some extra cash and cover the expenses of your parking lot ownership. You can’t just relax once you secure a tenant. To successfully manage the property, you must treat it like any other rental property.

Whether it's limited parking availability, broken gate arms, traffic congestion, or ensuring a positive user experience, a robust parking management system addresses these challenges and provides solutions for efficient operations. A well-implemented parking management system can help you achieve the following goals:

Maximizing Net Operating Income and Real Estate Value

By efficiently managing your parking spaces, you can increase revenue and enhance the overall value of your property.

A comprehensive parking management system considers factors like tenant experience, especially for mixed-use lots or hotels, and ensures smooth traffic flow to prevent bottlenecks.

Pricing Optimization

Setting pricing intelligently is critical to maximizing yield. Many old-school parking systems use fixed prices written on a sign or hardcoded into a parking machine or meter. Modern parking systems like AirGarage use dynamic pricing to charge drivers the best rate depending on the time of day and predicted demand.

A good pricing strategy also optimizes space utilization to ensure there are always some spaces available for new drivers and ensure turnover. Finding the right pricing strategy takes experimentation, so AirGarage constantly experiments with rates to maximize your revenue.

QR Payments and Validation

Implementing QR code payment systems and validation processes simplifies the parking experience for users and tenants. Especially when replacing:

Old cash and coin-based systems

QR code-based payments simplify reporting

Auditing

Taxes

License Plate Reading Cameras

License plate reading cameras can increase security and replace hardware like gate arms, improving traffic flow and eliminating the need for physical tickets or access cards. Removing legacy hardware like gate arms and pay machines can:

Reduce maintenance costs

Improve overall efficiency

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Simplify Your Parking Operations and Improve Your Customer Experience with Parqour －Book A Free Demo Today

Parqour is a parking software platform that helps operators run their businesses better and improve the customer experience. With features like automated license plate recognition, contactless payments, and real-time data analysis, Parqour can help: