Colliers Report: Parking Demands on the Rise While Vacancy Remains Low

Key Takeaways

• Columbia, South Carolina’s vacancy rate for parking garages in the Central Business District remains low at 16.1%.
• Four key points are affecting Columbia parking demand: Main Street redevelopment; new multifamily construction; intensifying office users and no new parking garage construction.
• Automated kiosks are being installed in privately owned garages to accommodate the need for afterhours, short-term parking.

To download the complete report: Q2 2017 Columbia Parking Market Report.

Downtown Parking Conditions

There are several factors largely impacting the demand for daytime Columbia parking: the acceleration of Main Street redevelopment, new downtown multifamily construction, intensifying office use and the lack of new parking garage construction. As a result, the mid-year 2017 vacancy rate for privately owned garages dropped to 11.9%; likewise, vacancy in publicly owned garages decreased slightly from 22.3% at mid-year 2016 to 22.1% mid-year 2017.  The average hourly rate for parking spaces in private garages is $1.82, up from $1.66 one year ago, while the hourly rate average for public garages has remained unchanged at $1.00 for the past four years.

Columbia’s overall retail vacancy rate at mid-year 2017 was 9.1%, and Main Street is picking up speed. New restaurants downtown, such as Lula Drake, Public House, the Pita Pit and East Bay Deli, have opened their doors in the past year.  The Arcade Mall is adding shop spaces and updating their common area and the Famous Toastery and Cyberwoven also have plans to locate on Main Street.

In addition, there are three multifamily developments currently under construction at Canalside on Taylor Street, Park 7 on Assembly Street, and Brookland on Meeting Street. The Kline City Center on Huger Street is proposed to begin construction in December of this year and, upon completion, these new developments will add 1,167 apartment units to the market and create added Columbia parking demand.

Finally, office users are catering to the millennial preferences of smaller collaborative spaces and less personal workspace, thereby decreasing their overall footprint and increasing their parking required. The second quarter 2017 downtown office occupancy rate was 87.8%. As tenants are shuffled to fill smaller office spaces, the occupancy rate will increase. For this reason, the demand for parking during daytime business hours will remain high; moreover, the need for afterhours parking is also on the rise. Several privately owned downtown garages have upgraded to automated kiosks to capitalize on this need. The additional kiosk income captured will positively impact the return on each parking space.

Parking will remain a challenge due to the robust trend of office users, retailers, restaurants and residents flooding the downtown area. Parking occupancy will also remain high because there are no new parking garages currently scheduled for or under construction in the downtown Columbia area.  Viable parking in the near future will be essential to sustain Columbia’s continued growth.

For statewide commercial real estate news check out our market reports at: www.colliers.com/southcarolina/insights.

To download the complete report: Q2 2017 Columbia Parking Market Report.

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