Segmented demand for parking space: A challenge for developers and policy makers

Transcription

1 ETH Zürich, ISTP seminar und NSL colloquium, 16 June 2016 Segmented demand for parking space: A challenge for developers and policy makers Dr. Stefan Fahrländer 1

2 0 Stefan Fahrländer : Economics in Bern (lic. rer. pol.) 1998: DIW Berlin : Wüest & Partner in Zurich : UN Military Observer in the Middle East : ND applied statistics ETH Zurich : PhD in Bern (Dr. rer. oec.) : Wüest & Partner in Zurich 2006: Establishment of FPRE 2

3 0 Contents 1. Segmentation of demand 2. Asking the experts Costs versus return 4. Conclusions 3

4 1 Segmentation of demand 4

5 low low Social stratum Social stratum high high 1.1 Segmentation of demand in the housing market traditional middle-class Lifestyle individualized traditional middle-class Lifestyle individualized 1 Rural-traditional 4 Traditional middle class 7 Upper middle class 2 Modern worker 5 Liberal middle class 8 Professional elite 3 Transitional-alternative 6 Established-alternative 9 Urban elite Source: Fahrländer Partner & sotomo. 5

6 1.2 Segmentation of demand in the housing market (II) households have a general behaviour (life style) although some members especially children / youth might differ from the main body of the family; segments show different behaviour in the housing market, different location choice and different commuting behaviour; segments have different probabilities to work in a certain industry. Source: Fahrländer Partner & sotomo. 6

7 low low Value added Value added high high 1.3 Segmentation of demand in the office market low Contact intensity high low Contact intensity high 1 Service centers 4 Back offices 7 Specialised performers 2 Local service providers 5 Public-oriented enterprises 8 Headquarters 3 Creative thinkers 6 Private consultancies 9 Exclusive front offices Source: Fahrländer Partner & CSL Immobilien. 7

8 1.4 Crossing housing and office market segments two different groups might require parking spaces: - employees, - visitors; employees in a certain segment in the office market have probabilities to belong to a certain segment in the housing market. Source: Fahrländer Partner & sotomo, Fahrländer Partner & CSL Immobilien. 8

9 1.5 Importance of parking for office market segments parking need (i.e. road access) and importance of proximity to public transport could be derived from the segment in the housing market. is this really correct? Source: Fahrländer Partner & sotomo, Fahrländer Partner & CSL Immobilien. 9

10 1.5 Essence from the segmentation of demand households in different segments show different commuting behaviour. choice or need? different commuting behaviour because of location choice of office market segment? uncertain causality with these data 10

11 2 Asking the experts... 11

12 2.1 Communal planning law as a challenge Planning law is Cantonal or even Communal law Minimal requirements and / or maximal number of parking places per unit No systematic overview available, so we asked the experts Hereafter: Main results, for detailed results see annex 1 Source: Fahrländer Partner. 12

13 2.2 Asking the experts: General Web-based survey carried out in April experts (developers, investors) in French and German speaking parts of Switzerland invited 118 responses (17.7%) 11 multiple choice questions - 4 questions on pure housing developments on locations with different centrality and access to public transport - 4 questions on mixed use developments on locations with different centrality and access to public transport - one question each on future developments - one question on the influence of limitations of the number of journeys Source: Fahrländer Partner. 13

14 2.3 Pure housing, city centre, excellent public transport to few 13% other 4% too many 9% Please think of pure housing developments with excellent access to public transport in city centres. rather too few 20% rather too many 29% Please assess the regulations concerning the minimal / maximal number of parking spaces. What you have to / can build is... ok 25% N = 106. Source: Fahrländer Partner. 14

15 2.4 Mixed use, city centre, excellent public transport to few 18% other too many 2% 2% rather too many 11% Please think of mixed use developments with excellent access to public transport in city centres. ok 25% Please assess the regulations concerning the minimal / maximal number of parking spaces. What you have to / can build is... rather too few 42% Source: Fahrländer Partner. For all questions and answers see annex 1. N =

16 2.5 Comparision pure housing vs mixed use 45% 40% city centre residential neighbourhood small / mid-size town other locations 35% 30% 25% 20% 15% 10% 5% 0% apartment buildings mixed use apartment buildings mixed use apartment buildings mixed use apartment buildings mixed use rather too many too many Source: Fahrländer Partner. For all questions and answers see annex 1. 16

17 2.6 Comparision pure housing vs mixed use (II) 70% 60% city centre residential neighbourhood small / mid-size town other locations 50% 40% 30% 20% 10% 0% apartment buildings mixed use apartment buildings mixed use apartment buildings mixed use apartment buildings mixed use rather too few too few Source: Fahrländer Partner. For all questions and answers see annex 1. 17

18 2.7 Pure housing, future needs for parking spaces much less 15% other much more 1% 4% rather more 7% How do you assess the future needs for parking spaces in pure housing developments. the same 25% rather less 48% N = 100. Source: Fahrländer Partner. 18

19 2.8 Mixed use, future needs for parking spaces much less 12% other much more 1% 3% rather more 16% How do you assess the future needs for parking spaces in mixed use developments. rather less 25% the same 43% N = 90. Source: Fahrländer Partner. 19

20 2.9 Essence from the survey in pure housing developments investors are often forced to build vacant parking spaces, especially in the city centres in mixed use developments investors often cannot build enough parking spaces to meet the needs of the commercial use experts expect declining demand of parking spaces in pure housing areas and the same demand for parking space in mixed use areas is this consistent? 20

21 3 Costs versus return 21

22 3.1 Production costs developers say: CHF per underground parking space calculation: qm per underground parking space: 24.0 height 3.0 cm per underground parking space: 72.0 construction cost per underground cm total costs per underground parking space 350 CHF CHF An underground parking space, under normal conditions, has production costs of to CHF. Source: Fahrländer Partner. 22

23 3.2 Real estate data of investment properties Locational characteristics Main property characteristics rental units Rental income Vacancies Characteristics of units 23

24 3.3 Monthly return of underground parking spaces rent per month (CHF) % 20% 30% 40% 50% 60% 70% 80% 90% 99% quantile Source: Fahrländer Partner, N:

25 3.4 Approximate market value of underground parking spaces 80'000 70'000 60'000 50'000 40'000 30'000 20'000 10'000 approx. market value (CHF) 0 10% 20% 30% 40% 50% 60% 70% 80% 90% 99% quantile Source: Fahrländer Partner, N:

26 4 Conclusions 26

27 4.1 Conclusions many investors are forced to build parking spaces in housing developments that then remain vacant, especially in the cities some investors are not able to build enough parking spaces to meet the need of the commercial tenants, especially in the cities experts expect declining demand for parking space in pure housing areas but the same demand for parking space in mixed use areas in many cases, underground parking spaces are not profitable, i.e. rental return does not cover investment and running costs saying this, underground parking spaces are subsidized by apartments and commercial uses since only parts of the tenants have their own car, tenants without cars subsidize the tenants that own a car 27

28 Thank you for your attention 28

29 A1 Expert survey concerning parking policy 29

30 A1.1 General Web-based survey carried out in April experts (developers, investors) in French and German speaking parts of Switzerland invited 118 responses (17.7%) 11 multiple choice questions Source: Fahrländer Partner. 30

31 A1.2 Pure housing, city centre, excellent public transport to few 13% other 4% too many 9% Please think of pure housing developments with excellent access to public transport in city centres. rather too few 20% rather too many 29% Please assess the regulations concerning the minimal / maximal number of parking spaces. What you have to / can build is... ok 25% N = 106. Source: Fahrländer Partner. 31

32 A1.3 Pure housing, resid. neighbourhood, good public transp. to few 10% other 3% too many 8% Please think of pure housing developments with good access to public transport in residential neighbourhoods of big cities. rather too few 24% rather too many 20% Please assess the regulations concerning the minimal / maximal number of parking spaces. What you have to / can build is... ok 35% N = 104. Source: Fahrländer Partner. 32

33 A1.4 Pure housing, small / mid-size town, good public transp. rather too few 16% to few 7% other 3% too many 8% rather too many 13% Please think of pure housing developments with good access to public transport in small and mid-size towns. Please assess the regulations concerning the minimal / maximal number of parking spaces. What you have to / can build is... ok 53% N = 100. Source: Fahrländer Partner. 33

34 A1.5 Pure housing, average / poor access to public transport to few 15% other too many 1% 2% rather too many 11% Please think of pure housing developments with average to poor access to public transport. Please assess the regulations concerning the minimal / maximal number of parking spaces. rather too few 29% What you have to / can build is... ok 42% N = 90. Source: Fahrländer Partner. 34

35 A1.6 Pure housing, future needs for parking spaces much less 15% other much more 1% 4% rather more 7% How do you assess the future needs for parking spaces in pure housing developments. the same 25% rather less 48% N = 100. Source: Fahrländer Partner. 35

36 A1.7 Mixed use, city centre, excellent public transport to few 18% other too many 2% 2% rather too many 11% Please think of mixed use developments with excellent access to public transport in city centres. ok 25% Please assess the regulations concerning the minimal / maximal number of parking spaces. What you have to / can build is... rather too few 42% N = 91. Source: Fahrländer Partner. 36

37 A1.8 Mixed use, resid. neighbourhood, good public transp. to few 12% other too many 1% 3% rather too many 11% Please think of mixed use developments with good access to public transport in residential neighbourhoods of big cities. Please assess the regulations concerning the minimal / maximal number of parking spaces. ok 28% What you have to / can build is... rather too few 45% N = 91. Source: Fahrländer Partner. 37

38 A1.9 Mixed use, small / mid-size town, good public transp. to few 11% other too many 1% 4% rather too many 10% Please think of mixed use developments with good access to public transport in small and mid-size towns. rather too few 32% Please assess the regulations concerning the minimal / maximal number of parking spaces. What you have to / can build is... ok 42% N = 90. Source: Fahrländer Partner. 38

39 A1.10 Mixed use, average / poor access to public transport to few 21% other too many rather too 3% 0% many 8% ok 29% Please think of mixed use developments with average to poor access to public transport. Please assess the regulations concerning the minimal / maximal number of parking spaces. What you have to / can build is... rather too few 39% N = 87. Source: Fahrländer Partner. 39

40 A1.11 Mixed use, future needs for parking spaces much less 12% other much more 1% 3% rather more 16% How do you assess the future needs for parking spaces in mixed use developments. rather less 25% the same 43% N = 90. Source: Fahrländer Partner. 40

41 A1.12 Consequences of limitations of number of journeys completely disagree 14% other 2% completely agree 1% rather agree 9% limitations of the number of journey force developers and investors to build bigger apartments. well, there is a tendence... 27% rather disagree 47% N = 89. Source: Fahrländer Partner. 41