Parking Supply Management Strategies

Sep 15, 2013

Parking Supply Management Strategies

Parking management embraces a variety of strategies that seek to either reduce parking spaces needed or to use parking spaces more efficiently. Parking management arose out of a concern that parking lots and off-street parking cover a significant proportion of urban areas, particularly high-demand regions such as central business districts. The Chicago CBD is thought to have over 975 acres of parking (Manville and Shoup, 2005). This coverage is viewed by some as an urban eyesore, reducing walkability, and depriving the city of additional property tax revenues (parking lots are often in high-demand areas where land has a high value). Parking management proponents argue that these vast amounts of high-value land could be put to better use.

Given the unique qualities of individual communities, it is difficult to say what the minimum or maximum parking requirements in our region should be, even if specified by land use. Litman considers ‘optimal parking supply' to be "the amount that motorists would purchase if they paid all costs directly and had good parking and transport options" (2006). Many surveys measuring demand assume that parking is free and do not consider whether an area has alternative modes of transportation. Also, most people are unaware of problems that stem from excessive parking supply. Contemporary parking planners suggest shifting to efficiency-based standards that allow parking lots to become full, using management strategies to take care of overflow and address any potential problems (Litman, 2006 and Shoup, 2007).

Parking management strategies can also promote efficient use of existing parking, such as shared parking plans and improved information on the availability of parking. Parking management techniques are utilized in reforming city ordinances to reduce parking requirements for new development, which are typically designed to accommodate rare peak demand (occurring perhaps once a year) in an auto-only environment. Most parking management projects utilize a variety of strategies, employing each as needed to best address each unique situation. As mentioned in the introduction, it is important for the parking strategies to be flexible, so that they can be easily adjusted to the changing needs of a community.

Maximum and Minimum Requirements

Traditional parking requirements specify a minimum number of spaces to be provided for each land use. Alternatively, planners can use parking maximums to better utilize the space. Parking maximums can be used in addition to, or instead of, parking minimums.

The parking minimums set by most communities are often based on the idea that more parking is better. Too little parking can lead to spill over into neighborhoods and cars circulating unnecessarily looking for parking; most local governments and developers want to avoid such outcomes. Unfortunately, the data used to set minimum parking requirements is often limited and irrelevant. To conduct a full parking study of actual parking needs in a community is usually cost—and time—prohibitive. As a result, most cities either copy the parking codes of other cities or use the Institute of Transportation Engineers' Parking Generation handbook. Even in ITE's handbook, reported parking rates are not necessarily based on much data and the studies feeding into them may come from such varying situations as to have no relevance for the cities consulting the data (Shoup 2005). The existence of transit and/or provision of biking and walking infrastructure can greatly reduce parking needs, and the ITE handbook does not consider such variation between communities.

A 1998 study done for the RTA illustrates this gap between actual demand and supply. A survey of 6 suburban office buildings found that the average parking supply was 3.62 spaces/1,000 square feet (of office building), while the actual demand was 2.45 spaces/1,000 square feet. Building occupancy had a large influence on demand, but even after adjusting the numbers for full occupancy the authors determined that supply could be reduced by 17% and still meet all the existing parking demand. The study recommended that municipalities with more than requirements over 3.5 spaces/1,000 square feet of building revisit their regulations (Regional Transportation Authority 1998). In a nationwide study by Kuzmyak et al., the authors concluded that a parking ratio of 2.0 would sufficiently cover the needs of most business parks, but that each location would have to be analyzed individually to determine special situations or circumstances (2003).

The same study also found that the quantity of parking provided was almost always determined by municipal ordinance or zoning code. In a survey done for the study, most developers reported that they would reduce the amount of parking if they could get a higher return on investment via more development, or if incentives or bonuses were offered. Some developers also worry about the "marketability" of a building if their parking supply is restricted (Kuzmyak et al. 2003). The authors of the RTA study concluded that municipalities would see short-term fiscal benefit only if reduced parking led developers to construct more buildings. In the longer-term, reduced excess parking supply could help to raise land values, which would be to the municipality's benefit (Regional Transportation Authority 1998).

Shared Parking

Shared parking is defined as "the use of a parking space to serve two or more individual land uses without conflict or encroachment" (Smith 2005). This practice is already commonly seen in larger downtowns, where parking (usually in garages) is not necessarily tied to a particular building and its uses, but can be used by anyone visiting any of the nearby buildings. Shared parking is most commonly found in downtowns and larger activity centers, but it can be a vital component in good mixed-use or transit-oriented developments, or anywhere that place-making is a focus. The pedestrian environment of a site often benefits greatly from shared parking.

The key to shared parking is a mix of uses that require parking at different times of the day, or different days of the week. For example, an office building in the same development as a movie theater or other entertainment venue would be a good candidate for shared parking. The peak parking demand for office workers will be from 8 to 5, Monday through Friday. Movie goers, on the other hand, will be looking for parking in the evening and on the weekends, when the office workers are not there. Instead of building one parking lot for the office building and another one for the movie theater, the two uses can share a lot. Fewer parking spaces can free up land for other development or for more landscaping and pedestrian amenities. Such arrangements can also encourage people to park once and walk between destinations served by the same parking facility, instead of driving between uses that would otherwise each have its own surface lot.

Shared parking works in any number of situations, and a methodology has been developed for analyzing how many spaces need to be built to fit the needs of a particular mix of uses. Shared parking is often coupled with many of the other parking management strategies discussed in this paper, such as pricing, overflow parking, and reserved parking. The other strategies are often necessary to ensure successful implementation of shared parking.

Not all municipal parking requirements allow for shared parking. Communities hoping to encourage place-making type developments, however, should consider more flexible parking standards. For communities and developers alike who are interested in shared parking, the Urban Land Institute's Shared Parking methodology (2005) has been recognized by the Institute of Transportation Engineers and is a valuable resource for those considering this type of parking management.

Employer-Institutional Parking

Since the largest peak-period demand for parking comes from home-to-work trips, and a majority of commuters drive to work alone, employer parking management strategies can be very successful at reducing overall vehicle miles traveled (VMT). The goal of employer parking strategies is to reward people who carpool or take alternative modes of transportation and discourage or penalize single-occupant drivers, with the use of incentives and disincentives. Wilson and Shoup show that the greatest reduction in single-occupant drivers is seen when employers eliminate parking subsidies while implementing other incentives. If employers offer incentives to use other modes and continue to subsidize parking, it is difficult or impossible to reduce the number of single-occupant drivers (1990). If employers continue to provide free parking, there will always be a high demand for it. This has an influence on the development of municipal zoning laws and codes, which often require excessive parking spaces. There is a need to coordinate the efforts of reducing employer-subsidized parking and the changing of local zoning requirements. Studies have found that with the way parking is subsidized and the "effects of tax law," parking subsidies tend to benefit higher income groups (Wilson and Shoup, 1990).

There are various programs that offer financial incentives to commuters for reducing their automobile trips. Examples of programs include: Parking cash-out where commuters using subsidized parking can choose cash instead, transit benefits provides commuters with a subsidized transit pass, universal transit passes gives bulk discounts for transit passes, discounted or preferential parking for rideshare vehicles (Litman 2005). Shoup warns that some employees will take money offered in cash-out programs and still drive. They instead find on-street parking and/or other available commercial parking (cited in Kuzmyak et al, 2003).

To reduce the amount of employees that are congesting the roadways during peak hours, some employers may also allow employees to arrive at flexible hours, telecommute, or work alternative schedules. Similar to other strategies discussed in this paper, the employer programs are most successful when they are multi-faceted. Employers who are committed to reducing the number of employees arriving in single-occupant vehicles can provide transit benefits, park-and-ride passes, shuttle services, and/or preferential carpool spots, while increasing the costs of parking. For more on this subject, please refer to the Transportation Demand Management strategy paper.

On-street Residential Neighborhood Parking

Some areas with high demand for parking and/or high parking fees may push demand for parking into nearby residential neighborhoods. This demand can be managed with parking permits for residents. Overly restrictive regulations in residential areas can, however, lead to increased public and private parking development costs, which can prevent transit-oriented and traditional neighborhood development. Local authorities should evaluate neighborhoods on a block-by-block basis, balancing the residential parking demand with employee and/or customer access, while considering the development goals of the municipality.

In areas of high parking demand, exploration of the possibilities for shared on-street parking should be a goal. Neighborhoods with residential permits often have many under-used spaces during the day – a problem that Shoup considers to be the result of an overreaction to parking spillover problems. Alternatively, he suggests creating a market in curb parking, calling them residential parking benefit districts (2004); this would allow residents to continue to park free but charge a fee to non-residents high enough to maintain 15% vacancy. The revenue could be returned directly to the residents in the form of street improvements.

On-street Commercial Area Parking

On-street parking, as close to a business as possible, is the most convenient type of parking for potential customers, and keeping those spots available for short-term use should be a high priority. If on-street commercial parking is not managed or priced, commuters, employees and spillover parkers avoiding fees will use the parking spaces and the desired patrons will not have a place to park. Shoup suggests that municipalities charge a price that will ensure that approximately 15% of the spaces are always vacant (2003). This could be in the form of variable pricing that maintains a high enough price so that there will always be some vacancy, but not so high as to send business to other locations. Prices and restrictions would vary by block, time-of-day, and day-of-week.

Managing parking in commercial areas typically involves "setting peak hour, daytime, or 24-hour parking restrictions; establishing parking time limits, and installing parking meters" (Kuzmyak et al, 2003). The most important factor influencing the behavior of single-occupant drivers is parking cost to user, not supply; there is also a less intense relationship for maximum time limits (Ibid). It is important for communities to develop contingency plans so that they can provide the minimum spaces, monitor results, and have strategies to provide more if necessary.

Many communities have established Parking Management Authorities (PMAs) to oversee parking management and to determine the prices. These PMAs can then return the increased revenue generated from on-street parking pricing to the community in the form of streetscape improvements: lighting, planters, security, etc. An improved street environment can attract pedestrians and bicyclists who add to commercial "foot-traffic" without congesting the roadways.

Peripheral Parking Lots

Parking lots placed outside of the central business district, usually with shuttle service to major destinations, are called peripheral parking. When within 1 mile of the activity center, however, most users will actually walk to their final destination. The primary goal of peripheral lots is to divert traffic from the central business district (CBD) or major destinations where traffic bottlenecks might occur. Unlike other parking management strategies, the use of peripheral parking might change where people drive, but it is generally not an attempt to influence the mode choice or travel behavior of the driver.

Critics argue that peripheral parking can convert transit commuters to drivers or reduce usage of park-and-ride facilities further out from the destination. When given the choice, few developers will trade peripheral parking for less on-site parking and so the peripheral parking may not greatly reduce the amount of CBD parking. Some communities have used peripheral lots with limited success; the failure is usually attributed to "insufficient user cost savings to justify the loss in time or convenience relative to core area parking" (Kuzmyak et al, 2003). Peripheral lots can, however, foster carpooling if spaces in the CBD are reserved for carpools while others are shifted to the peripheral lots.

Structured Parking

The choice between surface and structured parking is generally driven by land costs. Where land costs are higher – usually in denser, more urban environments – it becomes more economical to build up than to build out. Excluding land costs, parking construction costs in 2006 were estimated to be (Bier et al 2006):

  • $3,000/space for a surface lot,
  • $20,000/space for an above-ground structure, and
  • $35,000/space for an underground structure.

Similar estimates were found for Evanston's Northwestern University campus in 2006, with slightly higher numbers for surface lots (Northwestern University Newsletter, 2006). Factors affecting parking construction costs are listed in the appendix. The annual cost to own and operate a parking space (assuming a total capacity of 500 spaces) follows a similar hierarchy, and in 2004 ranged from less than $400 for a surface lot space to over $3,500 for an underground structure space. Structured parking is recommended for areas with higher land values and high demand for parking. The construction costs of structured parking per space diminish with scale, but consideration must be given to the ability to recover costs through parking fees.

Few parking operators (public or private) recover the full costs of owning and operating the garage because they set parking prices lower than the full cost of a space or otherwise subsidize the spaces. One result of these high costs coupled with inadequate revenue from parking charges is that parking structures are "seldom built as freestanding commercial ventures" (Shoup 2005). The "Public Parking Financial Strategies" section of this paper outlines several options for financing parking structures.

There are benefits to parking structures over surface parking lots, despite their higher costs. Contrary to the perception that building structured parking will increase congestion, "it has been shown that there is less congestion because people immediately go to the deck to park, rather than cruise through town looking for spaces" (How to Handle Parking 2007). Another benefit is that parking structures can include other uses within the same building. In more urban environments especially, it may be desirable to have retail space on the ground floor. The retail can wrap around the base of the garage and improve the local streetscape. In active areas – such as downtown, near transit, or in a shopping district – such retail space may be able to draw fairly high rents. Those rents can then be used to subsidize the building or maintenance costs of the entire facility.


Park-and-ride facilities are parking lots near bus or rail stops that allow travelers to transfer from automobile (and other modes like walking and biking) to transit. These facilities are often an important part of a regional transportation system because they can provide more travel alternatives by facilitating shifts from automobile to rail, bus, or carpool (especially for commuters); increase the effectiveness of transit systems; and help reduce the need for parking in the central business district. An extensive system of park-and-rides already exists in the Chicago region around many Metra and CTA rail stops, as was detailed in the Introduction section. In the Chicago region, as in most places, the park-and-ride facilities are oriented towards rail transit serving the central business district and are primarily used by commuters. Pace park-and-ride lots serve both local and express bus transit.

Most park-and-ride lots exist to support transit use by allowing transit to draw more riders from a wider area than if riders relied on local bus service or walking and biking to get to a transit stop with service to downtown (e.g. Metra or CTA rail).

In terms of the region's parking supply, park-and-ride lots can be considered a substitute for long-term parking in the central business district (the Chicago Loop). By allowing commuters who might otherwise drive downtown for work to park their cars further out and take transit in, there is less need for parking in the downtown. Park-and-ride lots thus promote a more efficient use of land in the region, because less of the valuable land in the downtown needs to be devoted to parking, which is a relatively unproductive use. It is important to note that park-and-ride lots are primarily useful for commute trips and are generally not an effective substitute for non-work trips. Some rail lines carry a substantial number of riders during peak commute times and the presence of a park-and-ride lot has the indirect effect of reducing highway demand and the need for lane expansions.

The parking costs associated with park-and-ride lots can also provide substantial benefits for users. The daily fee to park at a Metra lot varies, but it is generally around $1.25. The costs to park in the Chicago Loop can run as high as $300 per month and $30 or more per day. Even after factoring in transit fare, this is a substantial discount. The parking charges at park-and-ride lots are not meant to manage the parking supply. They may help to cover some operations and maintenance costs at the facility, but to make park-and-rides effective, the cost to park and take transit must be less (often substantially so) than the cost to drive and park downtown. But if a fee is charged, it is preferable to have a system that charges the user for each time he or she uses it so that there is an incentive to supplement travel with other modes if possible. If a driver knows that riding a bicycle will save her a few dollars that day, there is an incentive not to drive.

The provision of park-and-ride lots may also help to keep downtown areas more vibrant by eliminating the need for additional parking. Some commuter rail lines carry a substantial number of passengers during peak traffic hours, which reduces the need to add highway or expressway lanes.

With the increasing popularity of transit-oriented development (TOD), the place of the park-and-ride in a transit system is changing. In general, park-and-ride facilities are located with as much convenience as possible to the transit station in order to make using the facilities more attractive. The land close to a rail station is, however, the prime location for the higher density, mixed-use buildings that characterize TOD. There is a greater need in TODs to balance pedestrian and automobile needs. For example, instead of surface lots, parking could be in garage structures that incorporate other uses on the ground floor. Shared parking strategies (discussed above) can be an important tool to make parking work in a TOD (How to Handle Parking 2007). If a parking garage is built in a TOD, a portion of the spaces can be allocated to (or shared with) transit commuters. The structure would ideally contain a mix of uses, such as retail and office on lower levels. Also, not every train station will have transit-oriented development, and these locations may be more appropriate for park-and-ride lots.

A related parking strategy is park-and-pool lots. Unlike park-and-ride lots, these are not necessarily directly served by transit but are instead meant to facilitate carpool and vanpool activities. Suburban employment centers are often difficult to serve with fixed-route transit (bus or rail) but are good candidates for carpooling. Park-and-pool lots are usually located near expressways and major highways in an urban area and are generally smaller than park-and-ride facilities. By increasing vehicle occupancy before drivers get on expressways or major highways, park-and-pool lots help reduce congestion on those roads. The lots also encourage carpool formation between commuters who otherwise live too far apart to consider carpooling. Finally, these facilities "demonstrate to the public that carpool [and] vanpool…alternates are being supported" (Nicholas 2004). Park-and-pool lots could be used in conjunction with Pace's vanpool program.


Bicycle Parking

BikeMeterParking plans should also consider bicycle parking and bicycle facilities as a means to reduce the number of spaces necessary. Many lots will use irregular or small spaces for bicycle and motorcycle parking. When converting from parking meters to pay-box systems, planners should consider the potential bicycle parking that is lost with the removal of meters. Some cities have removed the top of the meter and replaced it with an ornamental decoration, enabling bicyclists to continue using the meter as a bike rack, and reducing costs associated with meter removal and construction of bike racks. In Chicago, where pay boxes have been installed, some meters have a sticker informing people to pay for parking at the box, and that the "meter remains as a courtesy to cyclists." For more on bicycle facilities and planning, see the bicycling strategy paper.

To Top