The San Diego Union-Tribune recently reported that the CEO of Ace Parking, one of the largest national parking operators, had shared in an email that demand for parking at hotels in San Diego has dropped by up to 10 percent, restaurant parking demand is down 25 percent while demand for valet parking has dropped by 50 percent. No, the population of San Diego isn’t falling. Far from it. According to the Ace executive, the falling usage of parking is due to the growing popularity of car-sharing services like Uber and Lyft. Another contributing factor could be the increase in the construction of more and more apartments and condos in the downtown area of the city, creating a denser population who can walk to places they previously drove to.
The app-enabled ride-sharing innovation is an example of “disruptive innovation.” In this case, the disruption can be viewed as positive (if you are in need of a taxi in New York City, for example) or negative (if you own or drive a New York cab that had heretofore been a monopoly).
Disruptive Innovation| In business,”disruptive innovation” refers to the creation of a new way of doing things or a new type of marketplace or any type of innovative creation that eventually disrupts an existing market and value network. (Wikipedia)
The fall in demand for parking space is not limited to San Diego, according to the CEO of Ace. It is being replicated in the company’s 450+ parking facilities it manages, nationwide.
But much more is at stake than the revenues of the parking business – cities stand to benefit immensely as demand for parking drops. Parking spaces and lots generate relatively little tax revenue relative to commercial operations, and by increasing sprawl may actually harm the economy of cities like Los Angeles. Cities have begun — some, as far back as 2015 — relaxing zoning requirements that set minimum parking allotment.
Parking in the age of autonomous vehicles
The decline in the need for downtown parking will likely accelerate if “driverless” vehicles become a widespread reality. Using a car that can let passengers off and park itself outside the urban core could disrupt the entire method of parking planning used by cities today. And like almost everything related to innovation, that will likely be good for some (businesses that will no longer need to provide paring to customers or guests) and bad for others (owners of parking lots).
It is like the ironic English expression, “May you live in interesting times.” It’s ironic because it seems to be a blessing for good luck. But in reality, “interesting times” are not periods of peace and tranquility. “May you live in interesting times, ” actually means, “may you live in a time of disorder and conflict.”
istock